Developed countries quickly occupy or control high-quality resources on a global scale through overseas investment (mainly mining mergers and acquisitions), thus ensuring the stability of raw material supply and improving the income level, and quickly creating a large-scale international mining aircraft carrier, gaining mining monopoly advantage and mastering the right to speak on pricing. Although China is the consumption center of the world's resources, China's smelting enterprises have not benefited much from it. At present, the structure of the industrial chain and the spatial distribution of profits are in reverse, and most of the profits are mainly concentrated in the mining links. Such profit distribution and China's desire for overseas resources have made Chinese enterprises more and more eager to go abroad. In recent years, Chinese enterprises have actively participated in global resource allocation, which has achieved remarkable results. However, the main participants in overseas mining mergers and acquisitions in China are mainly non-mining enterprises, which not only lack related business background, but also the soft environment constraints in mergers and acquisitions are increasingly prominent, making the risks of overseas mining mergers and acquisitions increasingly prominent. Therefore, it is of great practical significance to strengthen the risk prevention of overseas mergers and acquisitions.

I. Risk status of overseas mining M&A

In p>212, the global economy was in a downturn, and mining M&A fell sharply in both quantity and amount; There are 941 mining mergers and acquisitions in the world, with a total amount of A $14 billion, down 9% and 36% respectively compared with 211. The financial crisis caused the mining capital markets in Canada, Australia and other countries to face financing difficulties, the market value of primary exploration companies and unconventional energy enterprises shrank sharply, and local governments in some mining developed countries strengthened lobbying and investment promotion, which made China's overseas mergers and acquisitions go against the trend. In 212, China's M&A transactions accounted for 21% of the global mining M&A transactions. The international mining depression has become an important opportunity for China's mining and non-mining enterprises to accelerate overseas investment. However, opportunities and risks coexist, and the risks of mining overseas mergers and acquisitions follow one after another, which are mainly reflected in the macro risks of host countries' political risks and social and environmental risks, and the micro risks of Chinese enterprises' operating background risks and project cost control risks.

1. Political risks of the host country

China's large-scale investment in the global resource industry has caused all kinds of abnormal speculations and unnecessary worries from the outside world, which has caused some countries to be politically alert, thus adjusting their foreign capital investment policies and increasing the government's scrutiny of investments from China. For example, in 212, the Mongolian government stopped the exploration and mining activities of China South Gobi Resources Co., Ltd., which had a legal license, and triggered the "South Gobi Case"; Although the acquisition of Nixon by CNOOC has been passed in Canada, this case has prompted the Canadian government to adjust its policy on the acquisition of Canadian resource companies by foreign state-owned enterprises, making it difficult to replicate similar mergers and acquisitions in the future.

2. Social and environmental risks of the host country

From the perspective of investment areas, Oceania, Asia and Africa are still the main target areas for China's overseas investment. The social environment in these areas is relatively poor, which makes China's overseas mining investment repeatedly impacted by social environmental risks. For example, in a gold mine controlled by Zijin Mining in China, there was a large-scale brawl between Russian workers and local residents, which caused several injuries. Local residents held demonstrations and demanded that China workers be driven out of the country. In addition, in the process of overseas investment, environmental protection and community issues are mixed with cultural traditions and national feelings, which are far beyond the legal scope and are very difficult to solve. Because of the protection of indigenous culture and other issues, generally speaking, it is difficult for Chinese personnel to integrate into the local customs for a while, and they are easily rejected and made things difficult by the local authorities in their production and operation. At the same time, it also involves local labor policies and the influence of trade unions.

3. Risk of business background

According to the amount of investment, at present, the main bodies of Chinese overseas investment are: cross-industry enterprises, mining enterprises and geological prospecting units. It can be seen that non-mining enterprises, including manufacturing, trade, engineering and real estate, have a higher enthusiasm for overseas investment. According to the filing data of China Mining Association, in 212, the cross-industry investment of non-mining enterprises in overseas mining industry was 4.685 billion US dollars, accounting for 69% of China's total overseas mining investment. It is not only a good thing for non-mining enterprises to invest in mining overseas, but also a high-risk thing. Because of the lack of professional technical background and industry experience, the investment quality of a few projects is not high, and individual projects can not even produce and operate normally.

4. Risk control of enterprise project cost

For more than ten years, there have been waves of mergers and acquisitions among global mining enterprises, and high-quality resources have been in the hands of international mining giants. At present, the quality of projects obtained by enterprises in China is usually poor, and some projects are forced to add project investment due to poor infrastructure conditions or abnormally high wages of local labor, which leads to inaccurate overseas investment budgets of some enterprises and difficult cost control.

second, risk development trend

soft environment refers to the sum of factors and conditions that affect mining mergers and acquisitions, such as system, law, policy, culture and even thinking concepts. The uncertainty of economic development caused by the deep adjustment of the world economy, the new hidden worries of the international monetary and financial system, and the troubles of resource protectionism, etc., all kinds of contradictions are intertwined and inevitably mapped to overseas mining mergers and acquisitions, which makes the soft environment risks show some new trends.

1. Resource protectionism is on the rise

Its main manifestation is that the political risk of the host country is intensified, and the legal and policy restrictive factors involved in Chinese enterprises' investment in mergers and acquisitions are increasing. Many host countries gradually strengthen the state's control over resources, hoping to introduce foreign investment to ease their own development embarrassment, but also worrying that other countries will occupy their resources and give their state-owned companies more development privileges; It not only saves the decline of domestic mining economy through the implementation of international M&A policy, but also restricts foreign capital's holding of domestic resource companies, thus greatly raising the entry threshold for M&A.. In this way, the instability of the host country's resource policy will inevitably lead to the uncertainty of the change of mining rights, making resource protectionism a new problem for overseas mining mergers and acquisitions. If resource protectionism continues to develop abnormally, it will inevitably lead to more variables in overseas mining mergers and acquisitions.

2. Environmental protection and social permission are increasingly harsh

If the preparation is insufficient, China enterprises may feel unfamiliar with the environmental protection and social permission involved in overseas investment. At present, the conditions of environmental protection and social permission in some host countries and investment places are increasingly harsh, which may even affect the normal development of overseas mining mergers and acquisitions. For example, due to the failure to take into account the environmental protection costs of different countries, community obligations, and the relocation costs of residents in mining areas, there have been cases of investment failures in mines acquired by individual China enterprises overseas.

3. Shortage of skilled workers overseas

Ernst & Young's report shows that in the next five years, Australia's resource industry needs to increase 17, skilled employees, otherwise it will lead to a decline in industrial output. 4% of Canadian mining workers will reach retirement age in 214, and these people have an average of 21 years of mining experience. Their retirement will make the gap of technical talents reach 6, ~ 9, in 217, and many mining enterprises may have a passive situation of "talent shortage". In addition, the tendentious labor protection policies held by powerful trade unions in some host countries have increased the cost of overseas mining mergers and acquisitions, increased the difficulty of project promotion, and the talent problem has become a short board that restricts the project landing.

4. The project lacks the continuous support of capital chain

At present, it is difficult to mortgage overseas assets and mining rights, and loans are mainly obtained through "internal insurance and foreign loans" to invest in overseas mining projects, which increases the financing burden of domestic entities. Generally speaking, most domestic geological prospecting units prefer the operation mode of holding and self-supporting in the process of overseas mining mergers and acquisitions, register or purchase exploration rights, use their own funds, enterprise funds, state funds or subsidies to carry out exploration, and integrate investors, operators and contractors, which makes the capital chain of Chinese enterprises tense, the support is not strong, the ability to cope with changes in the host country's resource policies is poor, and the assets of overseas mining mergers and acquisitions resources cannot be effectively protected. In addition, a common problem for private enterprises to participate in overseas mining mergers and acquisitions is that it is difficult to obtain loans and financing support, showing the embarrassment of going it alone.

iii. countermeasures and suggestions

in recent years, relevant state ministries and commissions have actively supported Chinese enterprises in overseas mining mergers and acquisitions in terms of special funds and consular protection, and achieved certain results. On this basis, according to the current situation of overseas mining M&A risks and the changing trend of soft environment risks, it is suggested to further improve risk prevention from the following aspects.

1. Improve the financing mechanism of overseas mining M&A investment

First, improve the investment risk prevention and control system. It is necessary to establish and improve the planning, coordination, service and management mechanism to promote overseas mining M&A investment, especially to improve the financing management system of overseas mining M&A activities, and formulate or revise relevant laws and regulations in view of the current situation of overseas mining M&A risks and the changing trend of soft environment risks. The second is to establish a financing market for mineral exploration. We can carry out overseas mining M&A exploration and financing activities in China's existing capital market entrepreneurial sector, clarify the listing standards of exploration enterprises, and cultivate new mineral exploration subjects. Third, actively open domestic and foreign mining rights platforms. Taking advantage of Tianjin International Mining Finance Reform Demonstration Base as a carrier, we actively encourage the mining rights of overseas mergers and acquisitions to be traded on this platform, so as to achieve the purpose of integration of domestic and foreign mining rights. Fourth, vigorously promote financing reform. As soon as possible, formulate relevant standards that are in line with the internationally accepted resource reserve standards, and promote the financing reform of mining enterprises in various ways, such as equity financing, fund financing, trust financing and bond financing.

2. government consultation and dialogue to resist resource protectionism

one is to sign a reciprocal agreement on overseas mining investment. Do a good job in intergovernmental consultation and dialogue with relevant resource-rich countries, establish a strategic partnership of resources, further strengthen support and help for infrastructure construction in resource-rich countries and investment places, and actively promote the establishment of a balanced and * * * win-win international resource map. The second is to establish an early warning mechanism for overseas mining mergers and acquisitions. Establish and strengthen the strength of resource counsellors in embassies of countries related to overseas mining investment. Actively establish overseas contact points to timely understand and master local information about the soft environment of mining mergers and acquisitions. The Ministry of Land and Resources timely formulates and annually revises the Guide to Mineral Resources Exploration and Investment of Important Countries in the World, so as to give timely warning to the latest resource policies of resource-rich countries, especially the changes in soft environment.

3. Encourage private enterprises to participate in overseas mining mergers and acquisitions

First, formulate regulations for the approval of overseas investment projects of private enterprises. Transform government functions, simplify the examination and approval procedures for foreign direct investment of private enterprises, and formulate detailed rules for the record management of overseas mining mergers and acquisitions of private enterprises in combination with the characteristics of the mining industry. The second is to provide policy information release and * * * sharing mechanism. At the national level, the cooperation of relevant government departments should be further strengthened, and relevant policies and measures such as issuing to enterprises through Tianjin Mining Rights Exchange and enjoying state-supported "going out" pre-investigation should be adopted. Third, the private enterprises acquired by overseas mining industry are inclined in financing. Domestic financial departments and financial institutions should support private enterprises to March into overseas mining M&A projects at the high end of the value chain, and China Export Credit Insurance Corporation should provide preferential treatment for private enterprises to engage in overseas mining M&A and other mining investment activities.

(writing: aftertaste)