August 31, 2018 / 10:34 AM / 3 months ago

UPDATE 1-China's Zijin Mining to take stake in Serbian copper complex

(Adds details, background)

By Aleksandar Vasovic

BELGRADE, Aug 31 (Reuters) - China’s Zijin Mining has won the tender to become a strategic partner in Serbia’s sole copper complex RTB Bor, pledging to invest $1.26 billion in return for a 63 percent stake, Energy Minister Aleksandar Antic said on Friday.

The company also promised a further $200 million to settle RTB Bor’s debt and said it would keep all 5,000 workers, the minister said.

Antic said that out of the $1.26 billion, $135 million would be invested in improving the environment while another $320 million would be invested in opening a new copper mine.

The deal is part of the government’s plan to sell-off indebted state-run companies to help spur growth and relieve pressure on the budget, as recommended by the International Monetary Fund.

RTB Bor will be the second Serbian company to be run by a Chinese business. In 2016, China’s Hesteel bought Serbia’s steel plant in the town of Smederevo.

RTB Bor’s copper exports in the first half of 2018 rose 23 percent to 15,000 tonnes, company data showed. Export revenue between January and June stood at $107.1 million and it sold copper worth an additional $30.9 million domestically.

RTB Bor accounts for 0.8 percent of Serbia’s GDP, but the government hopes its share will increase after the Chinese investment.

China has invested more than $1 billion in Serbia, mostly in the form of soft loans to finance highway and energy projects, as part of its so-called belt and road initiative to open new foreign trade links.

Serbia had previously failed three times to sell the mining complex. Russian-owned U Gold also placed a valid bid, but Antic said the government opted for the Chinese company as it pledged more investment. (Reporting by Aleksandar Vasovic; Editing by Ivana Sekularac and Mark Potter)

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