A Chinese lithium miner has completed its purchase of a stake in Perth-based rare earth miner AVZ Minerals, this is despite an earlier attempt by the federal government to block the sale.
Yibin will acquire a 9 percent stake in the Australian rare earth mining firm and begin operations.
Chinese Firm Maneuvers and Succeeds on Second Tilt at Rare Earth
AVZ has been courting Yibin since 2019 to assist with the development of the Manono Project, a project located in the Democratic Republic of Congo—set to be a major producer of lithium.The FIRB is only notified when a foreign entity acquires a minimum of 10 percent interest of a mining company.
Managing Director of AVZ, Nigel Ferguson said on May 14, “I am delighted to finally welcome Yibin Tianyi as a shareholder of AVZ.”
“Yibin Tianyi has always wanted to work with AVZ to progress the development of our Manono Project and I now look forward to finalise a formal offtake agreement with them for our lithium products.”
Lack of Clarity a Weakness in Current Foreign Investment Laws
Michael Shoebridge from the Australian Strategic Policy Institute told The Epoch Times on May 18 that the sealed purchase exposed a weakness in the federal government’s policy around advancing the rare earth industry.He said the government needs to be more explicit and declare it does not want “Chinese sourced investment” in rare earth processing. A lack of clarity could see Australian businesses inadvertently work against government policy.
“The problem with the current policy is it not being declaratory, the government isn’t giving clear guidance either to companies, or even the FIRB,” he said.
“They’re pretending everything is “country agnostic” when in fact, the sheer business risk to Australia from Chinese government coercion, is a factor we must consider explicitly, and in its own right.”
According to Shoebridge, having an explicit policy towards China would not only be more effective, but it could also influence global dialogue.
“You can see the power of that declaratory policy, both around 5G and the international inquiry into the pandemic,” he said.
Global Economic Model Shifts From ‘Cost’ to ‘Trust’
The Australian government has an ongoing partnership with the United States to develop rare earth supply chains independent from Chinese control.
Shoebridge said the move to diversify from China is part of a greater shift in global economic models. Previously, businesses and governments, driven primarily to lower costs, happily outsourced production to other countries.
However, with the current global economic climate, suffering supply chains, and the Chinese regime’s economic coercion, countries now place a priority on working with trusted partners.
“Trust is now a rising new valuable commodity in economic relationships and supply chains. So, trust is about whether your partner is reliable, and not just from a business partner sense, but also from the jurisdiction they are operating in,” he said.
“So, for rare earths, the problem with not factoring in trust … is people discount the Chinese [regime] will intervene and restrict and control supply of processed rare earth,” he said.
Yibin Tianyi is backed by Contemporary Amperex Technology (CATL), China’s largest lithium-ion battery manufacturer.
This year CATL began supplying batteries to Tesla Motors.
