Zinc is used in a wide range of applications including galvanizing steel to prevent rust and corrosion, creation of alloys such as brass and bronze, die-casting, rubber manufacturing, paints and pigments, batteries, agriculture fertilizers, and much more. China has a stranglehold on zinc controlling over 70% of the refining of the mineral, and many of the mines. Bolivia's far-left government has given up control of one of its refiners and is building another zinc refiner which will be funded and controlled by the government.
Bolivia's far-left government signed a deal with China on Tuesday (February 7, 2024) for China to take an interest in the country's first zinc refining plant. The $350 million loan is a 20-year loan and from China's export-import bank carrying an attractive interest rate of 2 percent.
Bolivia is one of the countries in Latin America competing with Brazil's Lula to be China's primary agent for China in the region. These moves puzzle observers who note that China is economically on its back foot, and Washington DC is becoming increasingly interested in China's involvement in Latin America.
"This project reflects the deep friendship and pragmatic cooperation between China and Bolivia. The new zinc refinery will not only contribute to Bolivia's economic development and create jobs but also solidify our strategic partnership." - Chinese Ambassador to Bolivia, Yao Ling, during the signing ceremony on February 6, 2024
Last year, Bolivia's government awarded construction and management contracts for the mine to China's Enfi-Crig consortium and to Chongqing CISDI Engineering Consulting Co. Attractive capital terms are possible from the Chinese government once they are assured control and access to what it is they desire.
Bolivia has a second zinc refinery proposed in the Potosi department of Bolivia. It is also anticipated to cost $350 million and is being funded by a bond issue by the Bolivian government with details yet to be released. The state miner, Comibol, will control this one. Both mines are expected to produce around 150,000 tons of zinc concentrate per annum.
Bolivia ranks between 5th and 8th in zinc reserves globally, depending on which measure is used. In production, it ranks 7th behind China, Peru, Australis, India, America, and Mexico. China is by far the largest refiner of zinc as it refines all that it mines and imports concentrate from many nations. Even Australia, with the largest reserves of zinc (27% of global reserves), exports almost all it mines to China for processing. Australia's zinc processing is limited to secondary refining capacity such as scrap zinc and zinc-containing byproducts. Peru, India, and America have limited zinc refining capacity with China filling the gap.
Zinc is used in a wide range of applications including galvanizing steel to prevent rust and corrosion, creation of alloys such as brass and bronze, die-casting, rubber manufacturing, paints and pigments, batteries, agriculture fertilizers, and much more.
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