Australian company Fortescue has secured a 14.2 billion Renminbi (US$2 billion) loan from a range of Chinese, Australian, and other international lenders.
Fortescue, formerly known as Fortescue Metals Group, is a publicly traded company majority owned by billionaire mining magnate Andrew Forrest.
In a statement, Fortescue said the loan—arranged and funded by the Bank of China and Industrial and Commercial Bank of China—is the first time an Australian company has been financed in Chinese currency.
Fortescue is a core supplier of iron ore to China and says it has a “long-standing relationship with China.”
Proceeds from the five-year loan, which carries a fixed interest rate of 3.8 percent, will be used for general corporate purposes and to support Fortescue’s ambitious decarbonisation agenda. This includes partnerships with Chinese suppliers and technology firms.
Executive Chairman Forrest said the loan was more than “just a financial transaction,” hinting at deepening ties with Beijing.
“As the United States steps back from investing in what will be the world’s greatest industry, China and Fortescue are advancing the green technology needed to lead the global green industrial revolution,” he said.
“This landmark [Renminbi] financing strengthens our long-standing partnerships with Chinese institutions and opens new frontiers for collaboration.”
Forrest also praised China’s leadership in industrial innovation, saying, “Fortescue shares that ambition and drive.”
Group Chief Financial Officer Apple Paget echoed Forrest’s sentiments that the deal was deliberately about deepening ties with Beijing.
“This financing deepens our engagement with existing financial partners and further expands our banking syndicate to institutions with Renminbi lending capabilities,” she said.
Concerns Over Foreign Interference
The news comes as discussion intensifies on how to counter Beijing’s growing dominance in the metal refining sector, as cheap imports and low-cost processing undercut Australian facilities, with the potential to threaten mines.“China is very clear about what it is doing; we need to be equally clear-sighted,” said McKell Institute CEO Ed Cavanough.
