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World

  • To economists, China overtaking Japan as the world’s second largest economy in nominal terms is almost meaningless. In more economically important purchasing power terms China overtook Japan almost a decade ago...

  • August has once more brought disaster to Russia. This same month has, over a dozen years, seen Russia’s sovereign default, two submarine accidents, terror bombings of airliners and the Georgian war. Now it has witnessed the deadly climax of the country’s worst heatwave.

  • Russia is desperate to put the “R” back in the Brics. Its membership of the elite quartet was questioned last year when its economy shrank 8 per cent, while Brazil’s contraction was barely noticeable and Indian and Chinese output powered ahead. Now Alexei Kudrin, the finance minister, is proposing that Russia should sell minority stakes in 10 state-controlled corporate jewels, including oil company Rosneft, VTB Bank, and the Russian Railways monopoly, totalling perhaps $29 billion. It would be Russia’s biggest asset sell-off since the botched loans-for-shares privatisations of the 1990s. The government should embrace it. But this time, it also needs to do it right.

  • Chinese premier Wen Jiabao recently told a German trade delegation that China would not block exports of rare earth metals, while disputing allegations that China’s investment climate has worsened for foreign businesses. European and American business associations have expressed concern over the past year at Chinese policies that favour procurement of goods and services with “indigenous innovation” as well as China’s promotion of national standards instead of international norms for technology and equipment.

  • In its recently released report on the state of the global mining industry – ‘Mine – Back to the Boom’ – PriceWaterhouseCoopers (PwC) reported that, in 2009, the Chinese had been in the forefront of mining mergers and acquisitions (M&A) across the world. “Chinese investment in 2009 made up $17 billion, or 22%, of all global mining M&A activity and 30% of the top ten deals by value,” it highlighted.  This is hardly surprising, given that, as the World Bank reported in its China Quarterly Update March 2010, the Chinese economy grew at a rate of 8.7% last year.

  • A looming new war between the key shareholders in Russian mining giant Norilsk poses short term risks for operations but could also bring unexpected benefits such as share buybacks, analysts have said. Norilsk’s share price have been underperforming the broader Russian market index MCX. and the Russian mining index recently as investors worry about a new conflict over ownership.

  • Chinese investments in foreign mining assets totalled $50-billion over the past ten years. As a result, a number of Chinese companies have already emerged as global mining majors, and more will follow them. It should be noted that few of these groups are dedicated mining companies; most are vertically integrated industrial complexes that do everything from exploration and mining through to metals and/or chemicals production and/or electricity generation and/or equipment manufacturing.

  • Russia’s economy ministry is looking into revising some base metals export tariffs, but no dates for any changes have been discussed, Economy Minister Elvira Nabiullina has said.

  • Russia is ready to invest $1 billion in uranium exploration in Namibia, Russia’s state nuclear firm has said as it seeks to compete for projects with Rio Tinto in the African country.

  • Russian coal miner Raspadskaya has declared force-majeure to main customers and said coking coal concentrate sales would plunge after the May mine blast that killed at least 66 miners.

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