01.
Recently, there has been a skyrocketing price of a product, causing anxiety among people in the industry.
This product is called alumina, and its price has doubled in a year, with a nearly 50% increase in the past two months. Someone said, is it wrong? Can it increase so much? Our alumina production capacity accounts for 70% of the world’s total, isn’t it the least lacking?
That’s right, our alumina production capacity is indeed large, but producing alumina requires bauxite. The surge in alumina is due to problems with the upstream bauxite supply.
What’s going on here?
Previously, we used to mine half of our bauxite ourselves and import the other half, mainly relying on Australia. Australia has always been a big spender, but later we found another importing country – Guinea. After ten years of operation, 50% of our bauxite is now imported from Guinea. Aluminum is widely used and cannot be used to build large airplanes or electric vehicles.
Due to the pleasant cooperation in bauxite mining, Chinese enterprises are now spending a lot of money to develop iron and gold mines in the local area. However, some people have stopped and want to regain control of Guinea, directly seize China’s overseas mineral resources, and strangle China. It can only be said that the resource war is far from as peaceful as everyone thinks.
On October 14th, a large group of ordinary people from Guinea gathered at the entrance of a Chinese gold mining company, holding banners and setting up roadblocks. Young people stood at the forefront, full of murderous intent, and the police cordon could not stop them. These people were eager to rush into the mining area.
Why are they doing this?
They believe that this Chinese enterprise is plundering their resources, damaging the environment, and destroying farmland. The police couldn’t figure out the true identity of these people, and even suspected that they were a group of robbers, because similar incidents had occurred before. A group of people said they were protesting, but ended up rushing in and stealing hundreds of pounds of gold.
Neither side yielded, and in the end, the police opened fire, killing a young Guinean man on the spot and a two-year-old child who suffocated to death from inhaling tear gas.
This incident exploded in the media on the same day, and then a bigger conflict emerged. The people of Guinea blocked the roads leading to various major mines, including aluminum and iron mines. Investors in these mines include the United Arab Emirates, China, and France.
02.
This conflict has caused almost all of China’s aluminum mining production in Guinea to come to a halt.
Ten days later, the port’s alumina inventory fell to its lowest level since 2015. Our bulk traders were inquiring about where alumina raw materials could be supplied, and even began to urgently contact small bauxite traders who had never dealt with them.
After years of stable export, China’s overseas mineral resources have been targeted again.
The story inside is a long story.
Guinea used to be a colony of France, and they rebelled against France for independence. China provided a lot of help, and Guinea’s most valuable asset is its minerals, including aluminum, iron, and gold.
At the earliest, the French took the lead, represented by the French Israeli tycoon Stan Metz. On the one hand, he gave high bribes to officials, on the other hand, he also made Israel give a lot of military aid and talent training. The commanders of Guinea’s special forces and some of the army’s young men have received such special training. Later, many of these people became powerful.
In this way, Steinmetz won the mining rights of the Simandou iron mine.
Source: The official website of the Simandou Iron Mine Winning Alliance. The Simandou iron mine is the largest and highest quality undeveloped iron mine in the world. Due to legal disputes and corruption allegations, it has not been exploited, and finally won by the French.
Steinmetz made a lot of money for 10 years, but was eventually sent to prison. Who is so powerful? The United Arab Emirates.
We all think that the United Arab Emirates has always been a very wealthy but harmless little transparent country. Before 2010, this view was correct, but since then, the UAE’s foreign policy has undergone a 180 degree turn.
Why is that? Due to the famous Arab Spring in 2010, a color revolution broke out. The UAE royal family felt that this was not feasible and joined forces with Saudi Arabia to spread money and provide military aid, mainly expanding their influence in North and West Africa.
They have intervened in the regime changes in Egypt, Libya and Sudan, and also provided a large amount of military aid to Mali, Burkina Faso, Chad, Mauritania and Niger, aiming to compete with the French for influence in the region.
Africa is their top priority, and within a few years, the United Arab Emirates almost controlled the strategic gateway to the Gulf of Guinea and the Red Sea.
03.
Who is the most hurt when they intervene forcefully? They are the original French and Israelis, who are losing ground in places like Africa.
Stanmets used to walk sideways in this area, completely monopolizing it. Later, he had no choice but to negotiate with Guinea, saying that I didn’t want iron ore anymore, but don’t accuse me of bribery and corruption.
Someone sympathized with him in Guinea, but the UAE refused. In the end, Swiss prosecutors sent Stanmets to prison. You see how chaotic the process was, it also shows that politicians who want to deal with businessmen can basically do whatever they want.
Now, Emirati can walk sideways, but they can’t finish such a big cake, so many Chinese enterprises see the opportunity.
Chinese enterprises have always invested in Guinea. The the Belt and Road Initiative in 2014 has excited Guinea’s President Conde and strongly supported it.
Guinea’s bauxite exports used to be limited, but with the help of Chinese enterprises, they became the largest exporter of bauxite in a few years.
In this process, we have had close cooperation with the United Arab Emirates. Of course, Chinese enterprises have invested 20 billion US dollars, mainly for urgently needed infrastructure construction. Currently, there are 14 bauxite mining companies in China alone.
The existence of these enterprises has given us great confidence.
In 2020, Australia started a trade war with us and used bauxite to suppress us. Why did we just retaliate at that time?
We have started operating bauxite mines in Bofa, Guinea, and can refuse their high prices.
Now that the UAE has cleaned up Steinmets, Chinese companies have seen hope of entering the iron ore industry again, and it is indeed going smoothly.
In November 2019, the consortium “Win Alliance” led by Chinese enterprises acquired 85% of the shares in Blocks 1 and 2 in the northern part of Simandou, and nearly 40% of the shares in Blocks 3 and 4 in the southern part were controlled by Chinese enterprises.
Both bauxite and iron ore have achieved great success.
04.
Can the French be willing to be killed? I’m definitely not happy about it.
What tactics do they use to counterattack? They won’t bid with you, they’ll just stage a coup and change the president.
In September 2021, Guinea’s special forces commander Dubuya staged a coup and arrested President Conte.
After he staged the coup, the whole world knows who instigated it, because Dubuya had long served in the French Foreign Legion, attended military schools in France and Israel, and his wife worked in the French National Gendarmerie
After the coup, we had to discuss how to divide the fruits. The whole Europe felt that the winner was in the bag. When Conde was president, he took away the mining rights of the French. Now the military government should also take away iron ore and bauxite. The infrastructure has been completed, which is a huge asset worth tens of billions of dollars.
And many countries, led by Australia, crazily purchased bauxite in the months leading up to the coup, which directly triggered panic in the supply chain, saying that they were not informed? Even ghosts don’t believe it.
But their idea completely failed.
Just one week after the coup, the military government promised that foreign investors’ investments would not be affected, allowed Chinese companies to resume operations two weeks later, and lifted the curfew in mining areas, which was a great benefit for Chinese enterprises.
What has happened in the past two weeks? Not disclosed.
Europeans were also shocked, and in the end, they analyzed the reasons and believed that some “modern management training and exchange programs” at Dongda had played a role. They said that about 1000 officials participate in these programs every year, and there are hidden dragons and tigers here.
Of course, Chinese enterprises are also very good at being human, promising to increase prices and repair 380 kilometers of National Highway 1 in Guinea. They also promised to build 70 kilometers of municipal roads in the capital and add two overpasses.
So this big crisis passed like this.
05.
Returning to the beginning of the anti epidemic campaign, you may have to ask, why has such a big change happened in just three years?
On the surface, it seems that this military government is not very reliable. The common people have endured it for three years and no longer want to endure it.
Why is that? 1. In three years, not only did the people’s lives not improve, but they also rapidly deteriorated. In December last year, Guinea’s main fuel depot exploded, causing power shortages and rising fuel prices, and people began to take to the streets one after another. 2. Their demand is for the military government to step down, because the military government promised to hold elections in October 2024 and return power to the people, but perhaps the charm of power is too great, and the military government is now a bit reneging. 3. It’s okay to back out, mainly because there are two factions within the military government, one wants to return and the other doesn’t. No one is doing anything important, and both are engaged in internal strife. 4. Their infighting is not just about arguing and swinging chairs, they are simply making people disappear.
General Koulibali, the former second in command of the Guinea Constitutional Council, insisted on returning the government, but died inexplicably in June of this year. A colonel was his supporter who died at home in September. Two leaders of civil society groups went missing on July 9th and are still missing. The leader of the mining and geological departments, who was at the forefront of the storm, was kidnapped on October 17th
So in Guinea now, social unrest is difficult to stop until the two factions are fiercely torn apart and the ultimate power is determined.
But in reality, these upheavals cannot be separated from France’s instigation.
How could France be willing to accept being squeezed out before?
Starting from the end of 2023, France will increase its economic and military aid to Guinea, providing financial support to the democratic forces of Guinea’s civilian population, and collaborating with the United States to hold training workshops in Guinea to cultivate young leaders. They will also provide Guinea with a large amount of weapons and equipment, and vigorously support the Guinea Marine Corps.
The United Arab Emirates first felt that the atmosphere was not right. In February, they refused Guinea’s $3 billion loan, but were quickly retaliated against. Now their bauxite exports have been basically suspended.
For Dongda, there are also some bad signs. Guinea is planning to build a solar power station and unexpectedly chose France.
06.
But many foreign media also believe that France’s target this time is not China at all.
Aluminum and iron ore may not seem interesting to them, but what about that big gold mine?
Coincidentally, Guinea discovered a large gold mine last month, located in the Sigiri Basin. European exploration teams have been monitoring this area for a long time, and on October 22nd, they issued an official report stating that there is an astonishing gold mine with world-class reserves, conservatively estimated to be around 1500 tons.
Although there are various monetary systems in the world, gold always holds an important position. For example, due to concerns about the collapse of US bonds, central banks around the world have been transporting gold back from the United States for a period of time.
The euro has been at a disadvantage in the competition with the renminbi since June this year. Can Europe not be in a hurry? Now that Guinea has such a large gold mine in front of the European Union, it can definitely greatly enhance the value of the euro.
So you see, why is the current turmoil happening at the doorstep of Chinese gold mining companies instead of aluminum and iron mines? Anyway, China’s mining rights overseas are bound to go through some twists and turns. If you talk to him about business and he talks to you about military, how can we protect our investment and rights? This is a new topic, but there are previous cases of crisis public relations. I hope this time we can also get through smoothly.