China's Baosteel, partners to invest 1 bln usd in Philippine nickel mine project

China's Baosteel, partners to invest 1 bln usd in Philippine nickel mine project

1st November 2006

AFX News Limited - http://www.forbes.com/home/feeds/afx/2006/11/01/afx3135504.html

HONG KONG - China's Baoshan Iron & Steel Co Ltd (Baosteel), Jinchuan Group and China Development Bank have agreed to invest 1 bln usd in a nickel mining project in the Philippines' southern island of Mindanao, Philippine President Gloria Arroyo said. 'Our country is generating huge investments and other forms of assistance from China and this project of Baosteel and its partners is a clear demonstration of our expanding trade relations with China,' she told a media briefing here today.

Arroyo is in Hong Kong this week after attending a business conference in Nanning, China which was attended by senior officials from the mainland, including Chinese Premier Wen Jiabao, and members of the Association of Southeast Asian Nations (ASEAN).

Arroyo said Philippine officials signed a memorandum of agreement with officials of Baosteel and its consortium partners relating to their proposed investment in the Philippines.

Baosteel is China's largest steelmaker, while Jinchuan Group is the country's largest producer of nickel, with an output of 60,000 tonnes of nickel per year and accounting for about 88 pct of China's total production.

Philippine Trade and Industry Secretary Peter Favila said Baosteel and its partners will own 100 pct of the mining project under recently-promulgated mining regulations which now allow foreign investors to wholly own projects which they intend to set up in Philippines.

'Other Chinese companies have expressed interest in putting up gold, chromite, bauxite and other mineral-related projects in the Philippines. The Chinese have emerged as the largest investors in minerals in the Philippines,' he said.

Arroyo said trade between China and the Philippines is expanding rapidly and that she expects more Chinese companies to invest in the country.

'Trade between the Philippines and China is growing by leaps and bounds. It is currently worth some 17 bln usd and the trade balance is very much in favor of the Philippines as China imports copper, electronics and other agricultural products from our country,' she said.

Arroyo said Philippine officials also signed two separate preliminary agreements with Chinese groups, involving a 500 mln usd investment in the second phase of a railway project north of metropolitan Manila and a 300 mln usd investment in a glass factory in Subic from a company in China's Hebei province.

(1 usd = 7.8 hkd)