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Concerns about Zijin’s impact and operating practices

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In a world where business activities are under constant global scrutiny, Zijin Mining, a Chinese state-owned company specializing in gold and lithium mining, stands out as a symbol of persistent concerns about its impact and operating practices in Latin America and beyond, Radio FM Bolivia reported.

Its track record is tainted by allegations of labor exploitation, environmental damage, and safety deficiencies. But beyond its operations, Zijin’s close relationship with the Chinese Communist Party casts an additional shadow over its actions in nations with loose regulations, Argentine news site Infobae reported.

“This is due to the close connection of these companies with the government of Xi Jinping, whose authoritarian leadership seeks to expand them in the Belt and Road initiative,” Luis Fleischman, professor of sociology and political science at Palm Beach State University in Florida, told Diálogo on September 5. “This expansion has a political purpose: to strengthen global Chinese influence in Latin America.”

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The state-owned mining giant under the sphere of influence of the Chinese government, acts as the main executor of Beijing’s ambitious strategy to acquire natural resources on a global scale, Infobae reported.

Tres Quebradas

In 2016, Zijin entered Argentina through its subsidiary Liex to develop the Tres Quebradas project in Catamarca, investing $450 million. Until August 2023, about $70 million were disbursed. However, the company faces investigation for allegedly over-invoicing imports of lithium mining machinery, Argentine platform La Política Online (LPO) reported on August 6.

According to Argentine daily Página 12, the Chinese company registered purchases of identical goods at prices much higher than market prices. A triangulation via Hong Kong would have been used, involving more than $5 million.

In November 2022, the Chinese firm’s lithium pilot plant was closed by the mining police of Catamarca, due to anomalies with chemical residues. In addition, according to LPO, workers at the mine salts said to work 12-hour daily for paltry wages. They do not have adequate equipment to handle chemicals and lack access to water for personal hygiene.

“Governments must demand that Chinese companies comply with the law,” said Fleischman. “Now, our hope for protecting the environment and preventing human and strategic mineral exploitation lies in the hands of governments. If they don’t act, problems will arise.”

Fleischman added that countries that place more value on respecting international guidelines, such as the United States, Canada, and Europe, will follow them as is their custom. However, if the governments of the nations where Chinese companies invest do not show interest, international law will not be able to sanction these companies.

Buriticá too

In Buriticá, Antioquia, Colombia, Zijin exploits the largest gold deposits. To obtain Colombian gold, the Chinese government-backed company faces conflict with local miners, and clashes with the Clan del Golfo criminal group, Radio FM Bolivia reported. Added to this are fiscal and environmental problems.

China is pressuring the Colombian government to provide additional protection to Zijin in the midst of this conflict, even suggesting the possibility of withdrawing the company and other investments from the country if its demands are not met, Radio FM Bolivia reported. The Zijin story is a narrative marked by controversy and opacity.

As is often the case in every country with Chinese influence, the ambassador acts as the main defender of Chinese interests and seeks to strengthen its operations through an “army.” Some suggest that Zijin may hire foreign mercenaries to protect its interests, according to Infobae.

“Corruption plays an attractive role for Chinese investors, similar to the power of drug traffickers, by buying the loyalty of politicians or judges while undermining state integrity,” Fleischman said. “Corruption drags down government quality.”

Constant conflict

Chinese companies not only create problems in Latin America, but in other parts of the world as well.

In Serbia, for example, Chinese negligence has affected the village of Bor. The inhabitants are protesting toxic air and water. Zijin manages the large-scale copper smelting and mining complex in that town without permits or official authorization, the Asia Financial newspaper reported.

In 2020, Zijin warned Papua New Guinea that, if its government did not renew the environmental license at the Porgera gold mine, bilateral relations with China would be damaged, Reuters reported. Papua New Guinea refused to extend the mining lease for 20 years, citing environmental damage and social unrest. Following Chinese pressure, on March 31, 2023, the Papuan government signed a new agreement.

Against their people

Chinese companies treat local people similarly to how they treat their own people. Their attitude toward their own citizens is indifferent, and that same attitude is reflected in their treatment internationally. “They don’t see citizens as people, they see them as subjects,” Fleischman said.

In 2018, a copper mine in Zujin, in China’s Fujian province, polluted the Tingjian River with toxic waste, generating an environmental disaster with a profound impact on local communities, investigative journalism platform Dialogo Chino reported.

“The environmental issue is global in scope and concerns everyone. Cooperation is crucial among the nations involved. If this issue continues to be politicized our progress will suffer. If governments view China as a savior or investor of choice, they must recognize that the health of their citizens and the environment are not a priority for China,” Fleischman concluded.

 

Source: Dialogo Americas

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