The Globalization Challenges of Chinese Mining Companies: Crossing Africa’s Verdant Mountains

Between 2016 and 2020, CMOC Group acquired two mines—TFM and KFM—from U.S.-based Freeport-McMoRan. In February 2021, Zhang Li returned once again to Lubumbashi. There, before him, lay the mountain—this time as CMOC’s Chief Construction Officer for TFM, entrusted with reawakening the giant slumbering across Central Africa: the TFM Mixed Ore Project. Today, through joint construction efforts by Chinese and African peoples, the world can see—Chinese enterprises have carved out new frontiers amid these mountains. Viewed from above, rows of neatly arranged buildings gleam like silver dots and lines on a circuit board under the sun. Above them, the mine has entered an unprecedented era of high-efficiency production. Leveraging copper and cobalt output from the T and K mines, CMOC surpassed Swiss mining giant Glencore to become the world’s top cobalt producer in 2023—and in 2024, emerged as the globe’s largest source of incremental copper supply. Joining CMOC on this land were other Chinese mining firms, including China Minmetals, China Nonferrous Metal Mining Group (CNMC), Jinchuan Group, and Zijin Mining. In neighboring Zambia—bordering the Democratic Republic of the Congo (DRC)—CNMC secured operational rights to the Chambishi Copper Mine via competitive bidding as early as the last century, transforming what had nearly become a derelict site under British management into Africa’s first digitalized mine. Yet beyond what the world sees lies a stark reality: behind these remarkable achievements, Chinese enterprises collectively confront formidable development challenges rooted in Africa’s entrenched poverty and underdevelopment. No one has the right to label an African who walks dozens of kilometers along dirt roads in search of work as “unindustrious.” Yet decades of poverty have trapped generations in remote, impoverished regions, depriving them of access to modern vocational skills. This results in: — On one hand, Africa’s overall employment rate remains extremely low. — On the other, multinational corporations arriving from afar face a severe shortage of qualified, experienced workers. Moreover, the continent’s industrial infrastructure is weak: Africa’s landmass equals the combined area of China, India, the United States, and most of Europe—but its railway network is scarcely larger than the combined rail systems of France and Germany. According to the African Development Bank, Africa’s total railway length stands at only 84,000 kilometers, heavily concentrated in North and South Africa. In the DRC—located in Central Africa—enterprises operating there must endure abysmally low transport efficiency and acute scarcity of supplies. We reviewed publicly available information and found that one of the greatest logistical challenges Chinese enterprises face in the DRC is “logistics assurance.” For instance, CMOC’s TFM and KFM mining sites—both located in Katanga Province—are far from any seaport, forcing companies to contend with exceptionally long transportation distances and numerous uncontrollable variables along the way. Similarly, during Zijin Mining’s construction of the Kolwezi Copper Mine—also in Katanga Province—every piece of engineering machinery, construction material, and even daily necessities for employees had to be imported. Strikes, delays, and bottlenecks at Africa’s main port—the Port of Durban in South Africa—are commonplace. Insufficient infrastructure—including roads, railways, and ports—raises intra-African trade costs by 30% to 40%. Those responsible for Africa’s “resource curse” attempt to blame China instead. U.S. Treasury Secretary Janet Yellen, during her visit to Africa, claimed that China “caused Africa’s debt crisis.”

Critical Mineral Strategies of China, the U.S., and the EU—and Global Competition

Third, the U.S. imposes tariffs on critical minerals imported from China to bolster its own supply chain resilience. On May 14, 2024, the Office of the U.S. Trade Representative (USTR) released its four-year review report on the Section 301 investigation and issued a statement on further Section 301 tariff actions against China. It announced increased tariffs on Chinese imports—including electric vehicles, lithium-ion batteries, and photovoltaic cells—and, for the first time, proposed imposing tariffs on 30 critical minerals from China, including niobium, cobalt, manganese, zinc, tin, gadolinium, and 26 other critical mineral products; permanent magnets; and three natural graphite products. Tariff rates on these items would rise from 0% to 25%. The primary objective is to center the strategy around partner countries—to maximize outreach to resource-rich nations across Asia, Africa, and Latin America, increase imports from allies and partners, reduce reliance on Chinese imports, and effectively exclude China from its so-called “diversified and resilient” critical mineral supply chain. Fourth, the U.S. seeks to undermine China’s global efforts to build critical mineral supply chains. Not only has the U.S. tightened restrictions on Chinese acquisitions of its domestic critical mineral resources, but it has also influenced the investment environment in allied countries—pressuring Australia, Canada, and others to strengthen investment reviews and impose equity limitations on Chinese enterprises, thereby erecting additional barriers to Chinese M&A activities. For example, since 2022, Canada and Australia have cited “national security” concerns to review or divest Chinese investments in their critical mineral companies. In 2023, Canada forced Chinese firms—including China Molybdenum—to divest stakes in Canadian lithium projects and blocked Zijin Mining’s acquisition of Solaris Resources. The U.S. pressured the Australian government to restrict Chinese equity holdings in lithium mining ventures (e.g., Northern Minerals), while promoting the establishment of a “Critical Minerals Refining Hub” in Perth—shifting lithium spodumene exports from raw ore to refined lithium carbonate, thereby weakening China’s pricing power. In June 2024, citing national interest, the Australian government required Chinese investors to sell shares in a rare-earth miner and restricted Chinese participation in rare-earth mining. Simultaneously, the U.S. has intensified efforts in recent years to court Global South countries—especially resource-rich nations in Africa and Latin America—supporting American firms in competing with Chinese enterprises for large-scale mineral resources and acquiring critical mineral projects. By broadening the definition of “national security,” the U.S. has amplified narratives about alleged Chinese monopolization of critical minerals, environmental noncompliance, labor disputes, circumvention of international standards, and weaponization of resources—highlighting perceived risks and pitfalls associated with Chinese mining investments and urging host governments to intensify regulatory oversight and scrutiny of Chinese mining enterprises. For instance, in August 2022, the U.S. Department of State issued a statement supporting the DRC government’s decision to review mining contracts and strengthen accountability, pledging over $30 million in aid to help the DRC promote responsible and sustainable mining practices. Subsequently, several Chinese mining enterprises operating in the DRC came under related investigations. In 2023, the U.S. and its G7 partners launched the Lobito Corridor project—a transnational initiative spanning Angola, the DRC, and Zambia. This project has become a centerpiece of U.S. Africa policy, aiming to establish an export corridor bypassing China and reducing dependence on Chinese-sourced copper and cobalt. Through the U.S. International Development Finance Corporation (DFC), the U.S. provides loans to resource-rich countries—with conditions attached. For example, in the Zambia–DRC copper-cobalt refining project, loan agreements included clauses prohibiting the use of Chinese equipment and technology.

CASS's Wang Yongzhong: Chinese Mining Firms Face Complex Overseas Challenges

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At the Caixin Summit, Wang Yongzhong advised Chinese mining firms to prioritize localization over resource acquisition amid rising geopolitical tensions. Strategic minerals like lithium and cobalt face soaring demand and record prices driven by energy transition needs.

caixin

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CASS's Wang Yongzhong: Chinese Mining Firms Face Complex Overseas Challenges

CASS's Wang Yongzhong: Chinese Mining Firms Face Complex Overseas Challenges

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