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World

  • Russia’s low interest rates may trigger a second wave of bankruptcy for the country’s companies and banks. Mr German Gref, head of Sberbank, expressed this concern following the central bank’s 14th rate cut since April 2009.

  • Merger talks between leading Chinese steel mill Baosteel and the Baotou Iron and Steel Group of Inner Mongolia have collapsed after four years of negotiations. The takeover bid by the Shanghai-based Baosteel, China’s second-biggest steel producer, failed after the intervention of the local government in Baotou last month.

  • LSE-listed Russian iron-ore and gold miner Petropavlovsk,  formerly known as Peter Hambro Mining, has announced  that a consortium of Hong Kong-based investors have agreed to invest $60 million into a new holding company to be created for its nonprecious-metals division, NPMHoldCo. The consortium comprises the Asia Resources Fund, which is a subsidiary of General Enterprises Management Services (GEMS), and CEF Holdings, which have agreed to provide the iron-ore miner with $50 million and $10 million in funding, respectively. In return for their investment, the companies would gain an equity interest in the new holding company.

  • China is introducing a 5% tax that the country’s energy companies must pay on oil and natural gas produced in Xinjiang, part of Beijing’s efforts to improve the economic prospects in the poor western region, where local ethnic Muslims have rioted against Han Chinese and where the windfall from the development of rich resources has been scant.

  • Russian aluminium company UC Rusal has rejected a claim by Guinea’s mines minister that it owes at least $860 million in unpaid taxes and said it aims to “protect its rights” in the West African nation. “The company has not received official notification about these tax claims and does not recognise them,” UC Rusal said in a statement. “UC Rusal is a good-faith investor and one of the largest taxpayers and employers in Guinea.”

  • China’s April imports of copper slipped to 436,345 tons versus 456,240 tons in the previous month, data from the General Administration of Customs showed.

  • Russian gold miner Petropavlovsk has said it is on track to produce between 670,000 oz and 760,000 oz this year, at least 38% more than in 2009, after a “transitional” first quarter.

  • China’s growing appetite for imported coal has lit a fire under coal prices and fueled deal making linked to the belief that the country, once a major exporter, will be a long-term buyer of foreign coal.

  • Chinese buyers will likely start entering into long-term supply contracts for uranium “in the near term”, a senior executive at Canadian producer Cameco has said. Long-term contracts usually call for deliveries to begin more than two years after the contract is finalized, and use a number of pricing formulas, including fixed prices adjusted by inflation indices, and market-linked prices.

  • China plans to shut down more out-dated production capacity this year in a variety of sectors including power, coal, steel, coking coal, ferroalloy, calcium carbide and nonferrous metal to force industry upgrading and energy saving and emission reductions.

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