EXCLUSIVE ROWAN CALLICK CHINA CORRESPONDENT AUST 16Ocr
Chinese probe big mine loss
The former chairman of a Chinese state-owned enterprise has been handed over to prosecutors for investigation after the company’s investments in several Australian mining ventures lost more than $1 billion. Li Jinming, who chaired Guangdong Rising Assets Management, which is owned by Guangdong province, was earlier expelled from the Communist Party following an investigation that began in 2014 over losses that the disciplinary inspection team described as “dreadful”.
The company was established 17 years ago with $2bn capital, the South China Morning Post reported, and it began investing in Australia after the Global Financial Crisis pushed down asset and commodity prices. It acquired, through different subsidiaries, lead-zinc producer Perilya for $45.5 million, coal producer Caledon Resources for $500m, copper and gold company PanAust — with a massive prospect awaiting commitment in Papua New Guinea at Frieda River — for $180m, and rare earths producer Northern Minerals for $60m, It also paid $15m for a large stake in gold and base metal explorer Hawthorn Resources.
Leading Chinese financial website Caixin reported that most of these deals had since made losses, with calls on further capital from GRAM. Li Zezhong, who worked for GRAM for 11 years, ultimately as president, was then appointed mayor of Zhuhai, a thrusting city of 1.5 million on the western side of the Pearl River Delta, just north of Macau.
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