Abstract
Shandong Gold Mining Co., a Chinese state-owned enterprise, brokered a deal in May 2020 to acquire TMAC Resources, a Canadian gold mining company with operations in the Hope Bay region of Nunavut. At the time, observers voiced concern about the merits of the deal, speculating that Shandong Gold may be motivated by political/strategic interests rather than solely firm-level economic considerations.
The deal faced a national security review from the Canadian government under the Investment Canada Act (ICA), after receiving added scrutiny in accordance with the April Policy Statement on Foreign Investment Review and COVID-19. Broadly, the review process – announced in October 2020 - examined elements of the proposed transaction that could be injurious to Canadian national security. This culminated in a formal rejection of the bid by the Governor in Council on December 21, 2020. A number of Arctic-related security concerns likely informed this process. As well, while not encompassed within the ICA, bilateral political considerations between Canada and China - as well as current public opinion in Canada towards China - are likely to have been factors taken into consideration by the Government in coming to a final decision.
Though this investment deal received significant attention in Canada and abroad, it is just one example of several mining related investments made in Canada’s north by Chinese state-owned enterprises (SOEs) in recent years. In light of Chinese state interest and investment in Northern Canada broadly, examining the numerous considerations facing Canada, such as the motivations of investors, domestic and international politics, and opportunities for industry development and growth in the Canadian North, is an important matter.
The deal faced a national security review from the Canadian government under the Investment Canada Act (ICA), after receiving added scrutiny in accordance with the April Policy Statement on Foreign Investment Review and COVID-19. Broadly, the review process – announced in October 2020 - examined elements of the proposed transaction that could be injurious to Canadian national security. This culminated in a formal rejection of the bid by the Governor in Council on December 21, 2020. A number of Arctic-related security concerns likely informed this process. As well, while not encompassed within the ICA, bilateral political considerations between Canada and China - as well as current public opinion in Canada towards China - are likely to have been factors taken into consideration by the Government in coming to a final decision.
Though this investment deal received significant attention in Canada and abroad, it is just one example of several mining related investments made in Canada’s north by Chinese state-owned enterprises (SOEs) in recent years. In light of Chinese state interest and investment in Northern Canada broadly, examining the numerous considerations facing Canada, such as the motivations of investors, domestic and international politics, and opportunities for industry development and growth in the Canadian North, is an important matter.
| Original language | English |
|---|---|
| Publisher | University of Alberta |
| Publication status | Published - 12 Jan 2021 |
| Externally published | Yes |