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China's Zijin emerges as partner for Serbian copper mine, smelter

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China's Zijin emerges as partner for Serbian copper mine, smelter

Zijin Mining Group Co. Ltd. emerged as the winning investor for Serbia's sole copper mine and smelter, RTB Bor, Reuters reported Aug. 31.

The Chinese miner committed to invest US$1.26 billion for a 63% stake in the debt-laden asset, and pledged another US$200 million to settle RTB Bor's debt, according to Serbian Energy Minister Aleksandar Antic.

Of the US$1.26 billion figure, US$135 million would be invested to improve the environment, while another US$320 million would be earmarked for a new copper mine, Antic said.

The Serbian government published a tender in July seeking a US$350 million investment as part of the strategic partnership. Reuters reported recently that Zijin and Russian-owned U Gold submitted valid tenders for the potential partnership.

Antic noted that the government selected Zijin as it committed more investment.

The transaction forms part of the government's plan to off-load indebted state-run companies to relieve pressure on the budget and support growth, as recommended by the International Monetary Fund.

RTB Bor's copper exports in the first half rose 23% to 15,000 tonnes, company data showed, while the complex accounts for 0.8% of Serbia's GDP. The country previously failed to divest the complex as bidders fell short of requirements.

China has invested over U$1 billion in Serbia as part of its belt and road initiative, mostly in the form of soft loans to support highway and energy projects.