LBMA liaising with CME Group and US authorities on gold premium
London gold market stocks and liquidity remain strong, the association added.
China has systematically extended its control over critical minerals essential for the global energy transition and net-zero emissions, using a network of at least 26 state-backed financial institutions over the past two decades, a new report shows.
The database, compiled by AidData at the College of William & Mary in the United States, reveals how Beijing has leveraged an intricate web of financial mechanisms to dominate the global supply chain for critical minerals. These minerals — including copper, cobalt, nickel, lithium and rare earth elements — are vital for emerging technologies such as electric vehicle batteries and solar panels.
Between 2000 and 2021, Chinese financial institutions provided nearly $57 billion in loans to 19 low- and middle-income countries, the report shows. A parallel study title Power Playbook: Beijing’s Bid to Secure Overseas Transition Minerals, outlines 93 loan commitments and one grant involving 86 financiers — a mix of Chinese and non-Chinese entities — to 59 recipients.
Both studies underscore how China has deployed its vast foreign exchange reserves to secure long-term control over strategic mineral deposits in resource-rich nations. Key examples include copper and cobalt from the Democratic Republic of Congo and Peru, nickel from Indonesia, and lithium from Argentina.
Over 75% of these investments were structured to ensure Chinese ownership stakes, primarily through joint ventures (JVs) and special purpose vehicles (SPVs). These arrangements grant Chinese entities significant influence over the extraction and processing of these resources.
The report also highlights a key distinction between China’s mineral financing strategy and its flagship Belt and Road Initiative (BRI), President Xi Jinping’s global infrastructure program.
Unlike BRI loans, which are typically issued by a select group of Chinese development banks, transition mineral financing involves a broader network of lenders. These include state-owned commercial banks like the Industrial and Commercial Bank of China, Bank of China, and Citic.
The report shows that mineral lending often relies on serial loans rather than one-off arrangements, signalling a deeper, long-term commitment to securing upstream resources. According to AidData, almost 25% of loans in the mineral sector were backed by Chinese guarantors — a sharp contrast to the estimated 4% guarantee rate for general BRI projects.
The findings align with several recent reports, including a recent article on the subject by The Economist revealing that, in 2023, Chinese companies invested roughly $16 billion in foreign mines. This was the highest figure in a decade, up from less than $5 billion the year before.
The report raises concerns about the implications for host countries. In two-thirds of cases, JVs and SPVs excluded significant government ownership, reducing financial liabilities for these nations but also limiting their access to future financial returns from mineral extraction.
AidData’s findings bring into focus Beijing’s methodical strategy to secure access to critical minerals while other nations risk falling behind.
With these strategies now under scrutiny, the report calls attention to the broader geopolitical implications of Beijing’s dominance. It also raises pressing questions for developing nations about how to balance the economic benefits of Chinese investment with the need to retain sovereignty over their natural resources.
2 Comments
Clive Delmonte
These speculative investments in battery metals carry risks. Recently patents have been sought for batteries which contain absolutely no metals at all. If such ‘all polymer batteries’ prove viable, China’s investments in the owning and supply of battery metals will become less attractive.
Nana
You mean canada right? That’s the exact number after you follow the money. Let’s be honest now. We aren’t threatening china it’s canada. They didn’t drop to 14th over nothing.