Ottawa is taking steps to protect and develop its critical minerals supply chain by cracking down on foreign governments’ investment in these natural resources. On Nov. 2 Innovation, Science and Economic Development (ISED) Minister Francois-Philippe Champagne ordered three Chinese companies to sell their investments in Canadian lithium companies.
“We will act decisively when investments threaten our national security and our critical minerals supply chains, both at home and abroad,” he said in a statement.
Critical minerals, which include lithium, cobalt, copper, as well as the rare earth elements, are vital for a number of technologies across a range of applications, such as batteries, electronics, defence, and renewable energy. Thus the demand for them is only projected to go up.
China is by far the dominant player in the global critical minerals supply chain—with 80 percent market share in some cases—and Canada and the United States are trying to wrest control to ensure reliable access for themselves and their allies.
Champagne said the government has ordered Sinomine Rare Metal Resources Co. Ltd. to divest itself of its investment in Power Metals Corp., Chengze Lithium International Ltd. to divest itself of its investment in Lithium Chile Inc., and Zangge Mining Investment Co. Ltd., to divest itself of its investment in Ultra Lithium Inc.
“The government’s decisions are based on facts and evidence and on the advice of critical minerals subject matter experts, Canada’s security and intelligence community, and other government partners,” the minister said.
‘Additional Direction’
Less than a week before Champagne’s Nov. 2 order, the feds had provided “additional direction” on applying the Investment Canada Act (ICA) in cases involving foreign investments by state-owned enterprises (SOEs) in Canada’s critical minerals sectors.
“Significant transactions by foreign state-owned enterprises in Canada’s critical minerals sectors will only be approved as of likely net benefit on an exceptional basis,” said an ISED statement issued Oct. 28.
As is custom in such announcements, no specific country was named, but China would be the logical target given past Canadian experience with its SOEs and the current state of affairs with critical minerals globally.
“The global market for critical minerals is rapidly evolving and the strategic value of certain minerals, including lithium, has grown. The government has concluded that a lack of secure access to critical minerals found and developed both within and outside of Canada, by Canadian firms, is a source of national security risk for Canada,” a spokesman for ISED told The Epoch Times.
The government is in the process of finalizing its first Critical Minerals Strategy, announced in this year’s federal budget. Budget 2022 proposed to provide up to $3.8 billion over eight years to implement the strategy, starting in 2022–23.
