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| Speech on China Mining
2003
Ms. Shou Jiahua, Vice Minister of Land and Resources
October 28, 2003 Kunming
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¡¡¡¡The annual China Mining International Conference
is opening in the beautiful Spring City of Kunming. First of all
I would like to express my warm welcome to my friends for your
participation on behalf of the Ministry of Land and Resources
and myself. I also wish to take this opportunity to thank you
all for your long-standing attention and support to China¡¯s mining
industry.
¡¡¡¡China Mining International Conference is an important forum
for Chinese government to collect comments from different sectors
and for domestic and international mining communities to exchange
ideas. As an important annual activity of international mining
industry, it has played an active role in improving China¡¯s mining
investment environment and deepening economic system reform. The
conference has been continually held for 4 sessions with new content
and new progress for each of them. In 1999 the first session of
China Mining International Conference was held in Dalian with
the theme of mining laws and regulations in China. After the meeting,
more than 20 exploration blocks were listed for foreign investment
and Yunnan was established as the pilot province for mining reform.
China Mining 2000 was held in Urumchi with the key topic of the
relationship between developing the West and attracting mining
investment.
¡¡¡¡Afterward, the document ¡°Some Opinions on Further Encouraging
Foreign Investment in Exploration and Exploitation of Non-oil-and-gas
Mineral Resources¡±, which was drafted by six ministries including
MLR and issued by the State Council, actively stimulated foreign
investment in West China. Before the opening of China Mining 2001
in Xi¡¯an, Vice Premier Wen Jiabao met with some of the foreign
representatives and Mr. Zou Jiahua£¬Vice Chairman of NPC Standing
Committee sent his congratulatory message to the conference. On
this session the opportunities and challenges facing China after
WTO accession were discussed as key topic and many important suggestions
for the further opening up of China¡¯s mining sector were raised.
In 2002 the Chongqing meeting presented good recommendations regarding
mining financing and streamlining approval procedure and thus
provided helpful ideas for the new government on enterprise reform.
¡¡¡¡More than 10 days ago, by publicizing¡°Decisions on some issues
in establishing socialist market economy¡±, the new government
revealed to its people the idea of improving socialist market
economy and promoting economic construction. This document shows
the resolution of Chinese government on reform, provides an interesting
topic to our conference and also brings new development opportunity
to China¡¯s mining industry. On this occasion, I would like to
introduce to you some information related to the development of
China¡¯s industry.
¡¡¡¡1.Reform paces of China mining industry accelerated
¡¡¡¡With the broadening and deepening of opening up, China is making
new breakthroughs in attracting foreign investment in exploration
and exploitation of mineral resources. Particularly in recent
years, foreign investors are showing increasing interest to China¡¯s
mining sector and a new round of investment upsurge is taking
place. From 1998 to now, in non-oil-and gas mining sector, there
have been 23 foreign invested exploration companies with 41 effective
projects, among which 15 companies and 27 effective projects are
established in 2003, covering various minerals like gold and copper.
In the pilot province of Yunnan, from the later half-year of 2002
to today, foreign capital mainly for risk exploration amounted
to 50 million US dollars. Currently there are 9 foreign companies
doing actual exploration work in the province, holding 49 exploration
licenses. Guizhou province has developed various forms of cooperation
with foreign partners such as mining title transfer, contracting,
entrusted exploration, cooperative exploration and exploitation
and joint venture development. At present there are 6 foreign
companies working in the province for mineral exploration and
exploitation. In Shaanxi, foreign investment from England, Australia
and South Korea etc. has exceeded 10 million US dollars, with
which 14 mining companies were established as solely foreign venture
or joint venture. Besides, 4 foreign companies are now working
in Sichuan for mining exploration and exploitation. In other regions
like Xinjiang and Inner Mongolia, the investment environment is
also more and more appealing to foreign businesses.
¡¡¡¡China¡¯s mining industry has shown unique vitality and significantly
stimulated the economic construction and sustainable social development
in our country. In past ten years, both production and consumption
volumes of mineral kept growing. For steel and ten non-ferrous
metals the average annual growth rate exceeded 7%; for crude oil,
the average annual growth rate of consumption exceeded 6%; similarly,
the figure for raw coal is 3.7%; for cast iron 8.1%; for steel
9%; for aluminum 11.6%. In 2002, the production volume of petroleum
was nearly 200 million tones and that of coal outnumbered 1.4
billion tones; for steel, ten non-ferrous metals, cement and fertilizer
the production volumes have topped the world and that for coal,
phosphorus and crude salt rank the second. In terms of international
trade for mineral products, China has established mineral trade
ties with more than 100 countries and regions. The export volume
of mineral products posts an average annual growth rate of 11.1%.
In 2002, the total export value reached 33.8 billion US dollars.
The import volume sees an average annual growth rate of 11.7%,
and the figure in 2002 amounted to 58.7 billion US dollars. It
is proved by practice that mining industry has effectively guaranteed
and promoted economic development.
¡¡¡¡2.Chinese government got more resolute on reforming mining industry
¡¡¡¡Starting from last year, Chinese government has made great efforts
in improving mining investment environment.
¡¡¡¡Firstly, fundamental reform was made on approval system. Up
to April 2003, the state Council has canceled 1195 approval items,
among which 16 ones are related to mining industry. In addition
the approved formality of 82 items was modified. The Ministry
of Land and Resources reviewed 509 documents related to land and
resources administration including laws and regulations in force,
law-equivalent documents, institutional rules, regulatory documents
and explanatory documents to laws and regulations. Through this
process, 177 pieces of them were decided or recommended to be
abolished , 71 pieces to be revised and 261 pieces remain effective.
Among the total, 292 pieces are related to mineral resources administration,
with 103 abolished, 44 revised and 145 continued.
¡¡¡¡Secondly, the revision of ¡°Mineral Resources Law¡±was started
in an all-round way. Regarding some new issues and problems emerged
since the implementation of The Amendment of ¡°Mineral Resources
Law¡±in 1996, the Ministry of Land and Resources has set up special
committee for the preparation of the amendment work of¡°Mineral
Resources Law¡±.The amendment shall be made in accordance with
WTO rules and principle of combining entity rules and procedural
rules so as to increase the practicability of the new law. Moreover
the scenario of reform on exploration rights and mining rights
system shall be designed according to the requirements for modern
property system presented on the Third Plenary Session of the
16th CPC Central Committee, namely, clear ownership, identified
responsibility, strict protection and dynamic transfer. Our objectives
are to protect the legal rights of mining title holders, to optimize
rules and monitoring system for mining rights transaction and
to promote orderly transfer of mining rights.
¡¡¡¡Thirdly, the construction of mining rights market is being effectively
pushed forward. The 1996 Amendment of Mineral Resources Law made
our mechanism primarily in accordance with international practice;
relevant rules and regulations were promulgated in 1998; compensable
designation of mining rights through competition was introduced
in 10 piloting provinces in 2001; and in 2002, the piloting area
was enlarged. On the basis of above efforts, we have made two
reforming measures. One is to prescribe that newly established
mining rights and exploration rights must be designated through
bidding and auction; the other is administrative regulation of
qualification of geological exploration entities. In this June
we started to abolish old controlling rules for exploration entities
and put into force the certification system. Under this system,
all foreign-invested companies (including exclusive foreign ventures,
joint ventures and cooperative businesses), so long as meeting
the conditions for geological exploration, can get registered
for geological exploration in land and resources administrations.
The certificate is not limited by administrative jurisdiction
and is valid in the whole country.
¡¡¡¡3.Chinese government will provide further service for reform
and opening up
¡¡¡¡Firstly , to increase the ability of geological work to serve
the whole society. In recent years, some fundamental changes have
happened to China¡¯s geological work. For instance it developed
from addressing contemporary and tactical issues to addressing
long-term and strategic ones. Thus geological work can better
serve the country¡¯s macro-decision making process; it got more
globalized and integrated with world geological sector by stepping
out of the country; developing from traditional operation methods
to modern ones, our geological work was improved in technical
level; geological information availability was increased by adopting
an open attitude instead of the closed one. Moreover our objectives
are more coordinated with market economy. For example, we have
conducted strategic surveying and evaluation to mineral resources
for the purpose of guaranteeing national economic construction.
Particularly in western area the exploration work for such resources
as petroleum, natural gas, copper, lead, zinc, chrome and sylvite
was enhanced according to the nation¡¯s strategy of developing
the West; we are looking for new mineral resources in the peripheral
area of some old mines in eastern region; we are exploring new
ways of conducting geological work in order to provide geological
knowledge and information to the society. For example diversified
products for geological knowledge dissemination can be produced
with abstracted and processed geological materials. In the future
we will adopt a more active and pragmatic attitude in doing such
basic and public beneficial geological work so as to better serve
the mining industry.
¡¡¡¡Secondly , to solve hot problems concerning foreign investors
by enhancing inter-department coordination and communication.
In order to implement the strategy of ¡°Utilizing two resources
and two markets¡±and to increase the ability of mineral resources
in guaranteeing well-off society construction, the Ministry of
Land and Resources has organized experts to conduct research on
how to make good use of domestic and international resources.
In addition we have consulted and communicated with some relevant
ministries over the outcomes of above research. For example, regarding
the issue of streamlining approval procedure for foreign invested
exploration projects for non-oil-and-gas mineral resources, we
have more than once consulted with the Ministry of Commerce. We
are planning to issue some document to give practical solution
to the difficulties facing foreign investors.
¡¡¡¡Thirdly to increase public availability of geological information.
This is one of our common concerns. But I want to assure you that
the Ministry of Land and Resources is moving forward in optimizing
relevant laws and regulations and is planning to increase geo-info
availability by some reforming measures including establishment
of ministerial and provincial geo-info centers and the construction
of national system for online requiring. Currently most provinces
(autonomous regions and municipalities) have completed the construction
of geo-info database and some of them have started online service.
The state spatial database for mineral resources reserves is just
in construction and planned to be open in 3 years. We are sorting
out and reorganizing in-stock geological materials for public
benefits in ministerial and provincial institutions according
to new regulations for confidentiality and provide them for public
use after confirmation, adjustment and treatment. Such materials
as 1: 500000 geo-map database and 1: 200000 digital geo-map spatial
database shall be available for public use after curtain technical
treatment. The issue of Geo-info availability involves various
government departments and the Ministry of Land and Resources
is now communicating with them. I believe some new regulations
in this regard will be made very soon and the difficulty in using
geological materials will be solved step by step.
¡¡¡¡Ladies and Gentlemen, China is aiming at quadrupling her GDP
in future 2 decades, which demands constant supply of large amount
of minerals as raw materials, presents new and higher requirement
to the ability of mineral resources in guaranteeing economic construction
and also brings opportunities for mining development. The issuing
of ¡°The Decision on Some Issues in establishing Socialist Market
Economy¡±will surly bring new vitality to the reform of China.
We will further push forward the strategy of developing the West
and rejuvenate old industrial bases in Northeast China so as to
coordinate economic construction in Western, Middle and Eastern
China. With the development of this significant step, China¡¯s
mining industry will enjoy promising prospect for development.
It is my sincere hope that domestic and international mining community
make their due contribution to further reform, opening up and
sustainable development of China¡¯s mining industry through joint
efforts and making good use of the opportunity.
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