One of China’s biggest weapons manufacturers is to begin developing a copper mine in central Burma after agreeing to terms with the Burmese government earlier this month.
A statement on the website of the state-owned China North Industries Corp (or Norinco) said the project will serve the dual purpose of “strengthening the strategic reserves of copper resources in [China], and enhancing the influence of our country in Myanmar [Burma]”. Norinco also bills itself as an engineering company.
At the beginning of June a top-level Chinese delegation, including prime minister Wen Jiabao, spent five days in Burma to ink a raft of new trade deals and mark the 60th anniversary of China-Burma diplomatic relations. It was during this visit that Wen oversaw the agreement for Norinco to take charge of the Monywa mine in Sagaing division.
China’s investments in Burma are soaring and will soon match those of Thailand and Singapore, the pariah state’s two main economic backers. The China National Petroleum Corporation (CNPC) has already begun work on the multi-billion dollar Shwe pipeline pipeline project, while Beijing has been busily damming Burma’s major rivers to feed its energy-hungry population.
Investment in Burma’s mines provides the ruling junta with one of its largest sources of legal foreign capital, behind hydropower and gas. The Monywa area is rich in copper, and operations there had been dominated by Canadian giant Ivanhoe Mines until it allegedly withdrew in March 2007 and transferred ownership to The Monywa Trust. At its peak the mine had been producing some 39,000 tonnes of copper per year.
The Norinco statement said only that the two countries agreed a “cooperation contract” but did not mention who the other party in the project was. The agreement was signed by Norinco general manager, Zhang Guoqing.
Tin Maung Htoo, from the Canadian Friends of Burma (CFOB), says however that Ivanhoe transferred its lot to a blind trust who have taken “[responsibility] for the firm’s 50 percent stake in Monywa copper project, officially known as Myanmar Ivanhoe Copper Company Limited [MICCL],” thereby meaning that Ivanhoe has retained some presence in the project.
The managing director of MICCL, Glenn Ford, told DVB however that MICCL “has nothing to do with the Norinco project” and that Ivanhoe Mines had nothing to do with MICCL, which was blacklisted in July 2008 by both the EU and US for its “key financial backing” of the Burmese regime.
Norinco was also sanctioned by the US in 2003 for its ongoing weapons sales to Iran, with the White House calling the company a “serial proliferator”. Tin Maung Htoo said that the company’s contract with Burma was an “apparent copper for weapons deal”. China also happens to be Burma’s biggest arms supplier.
GlobalSecurity.org claims that Norinco’s “main business is supplying products for the Chinese military”, and has a registered capital of US$30 billion. The value of China-Burma trade in the 2008-2009 fiscal year was US$2.6 billion.