The China Signal - November 5
Guyana gives green light for major infrastructure projects, BYD, lithium, IUU fishing
G’day, and welcome to The China Signal. This week, Guyana gives the green light to Chinese firms for two major infrastructure projects; BYD signals interest for Colombia’s Caribbean Regional Train project, while also launching their BYD HAN EV electric passenger cars in several countries in the region; M&A activity for lithium projects continues for a bumper year; Ecuador, Colombia, Panama and Costa Rica launch a major marine conservation initiative partly intended to deter IUU fishing; plus much more. Read on.
Infrastructure
Guyana 🇬🇾
Press Release:
Cabinet, at its most recent meeting, has granted its ‘no objection’ for the Office of the Prime Minister to engage China Railway Group Limited to construct the Amaila Falls Hydropower Project (AFHP) based on a Build-Own-Operate-Transfer (BOOT) model where the company will supply electricity to the Guyana Power and Light (GPL) Inc. at a cost not exceeding US$0.07737 per KWH and where the company will provide the entire equity required by the project and undertake all the risks associated with the project.
This follows the publication of a request for proposals by Government in various national newspapers during the period July 25 to August 15, 2021. A total of four companies submitted proposals, and China Railway Group Limited was identified as the most ‘capable partner’ by the Evaluation Committee after a rigorous evaluation process…
At the same meeting, Cabinet also granted its no-objection for the Ministry of Public Works (MoPW) to engage China State Construction Engineering Corporation Ltd. to construct the New Demerara Harbour Bridge (NDHB) based on a Design-Build-Finance (DBF) model with financial terms and conditions which would be no less favorable than those submitted in the preferred bidder’s price proposals. The proposal by China State Construction Engineering Corporation Ltd under the DBF model contemplates a construction cost of US$256.6 million, the lowest amongst all bidders.
Initially, the Government of Guyana, through the MoPW, pre-qualified nine (9) firms to submit bids for the construction of a two-lane dual carriageway…
The Guyana government has defended its decision to seek funding from China for projects here, saying that Beijing makes “softer” loans available than other countries.
“We made it clear to everyone. No financing from anybody comes with political strings but Chinese financing has been readily available to the world and we believe, like the rest of the region, we have to explore friends and partners from every part of the world,” Vice-President Bharrat Jagdeo told a news conference on Monday.
Colombia 🇨🇴
~Paraphrased translation~
The Caribbean Regional Train project, which seeks to connect Cartagena, Barranquilla and Santa Marta, is increasingly close to being a reality. Currently, the Unión Temporal Ardanuy-Coral Delgado & Asociados Abogados firm is carrying out the studies and design of the route of the railway line, whose final results should be revealed in March 2022.
El viejo proyecto del Tren Regional Caribe, que busca conectar a Cartagena, Barranquilla y Santa Marta, está cada vez más cerca de ser una realidad.
En la actualidad, la Unión Temporal Ardanuy-Coral Delgado & Asociados Abogados realiza los estudios y diseño del trazado de la línea férrea, cuyos resultados finales se deberán revelar en marzo del 2022.
For now, there are three options to for the Caribbean train line, which would be the first regional integration project financed by the three departments and whose purpose is to move passengers and cargo through the region.
Por ahora ha trascendido que hay tres opciones para echar a rodar el tren del Caribe, que sería el primer proyecto de integración regional financiado por los tres departamentos y cuyo propósito es mover pasajeros y carga por la región.
On the table are three proposals, two for passenger transport, and a third of both cargo and passenger transportation.
Sobre la mesa hay tres propuestas, dos para el transporte de pasajeros y una tercera que sería mixta (carga y pasajeros).
Juan Felipe Velásquez, representative of the Chinese multinational BYD in Colombia, presented to the governments the option of Skyrail, an elevated train technology for passenger transport.
Juan Felipe Velásquez, representante de la multinacional china BYD en Colombia, les presentó a las gobernaciones la opción de las tecnologías Skyrail o tren elevado para el transporte de pasajeros.
The BYD representative maintains that elevated systems require much less space for their construction, since the rail line is elevated, and only small spaces such as existing road separators are affected.
According to the estimates by the Chinese multinational, this type of elevated train could transport between 8,000 and 41,000 passengers per hour, at an average speed of 80 kilometers per hour. BYD already has experience in the sector, as it participates in several elevated train projects throughout the world, including Salvador de Bahía (Brazil). They are also promoting this technology for the Calle 80 section of the Medellín metro.
El representante de BYD en Colombia sostiene que los sistemas elevados requieren mucho menos espacio para su construcción, pues la vía va elevada y solo se afectan pequeños espacios como separadores viales ya existentes.
De acuerdo con las estimaciones realizadas actualmente por la multinacional china, este tipo de tren elevado podría transportar entre 8.000 y 41.000 pasajeros por hora, a una velocidad promedio de 80 kilómetros por hora.
Además, esta multinacional ya cuenta con experiencia en el sector, pues participa en varios proyectos de tren elevado en el mundo, como en Salvador de Bahía (Brasil), y están promoviendo esta tecnología para el tramo de la calle 80 del metro de Medellín.
The elevated train option that Velásquez presents is certainly compelling, however what I really applaud is the ability for BYD’s public relations team to essentially land a free advertisement in El Tiempo. It’s not clear whether they were the only company presenting their rail solutions to the government bodies, however they are the only company mentioned, and the second half of this article is essentially an advertisement for their capabilities.
BYD also announced the arrival of their luxury passenger electric vehicle the BYD HAN EV to Brazil, Mexico, Colombia, Uruguay, the Dominican Republic, Costa Rica and the Bahamas this week. As you would likely know, the car model’s name “Han” is a patriotic nod to the Han Dynasty of Imperial China, seen as a golden age of in China’s history. In present day China, the country’s largest ethnic group are also referred to as Han people.
Critical Minerals
Argentina 🇦🇷
Lithium Americas Corp (LAC.TO), made a $400 million stock-and-cash offer for Argentina-focused lithium developer Millennial Lithium Corp (ML.V) on Monday, seeking to outbid China's Contemporary Amperex Technology Co Ltd (CATL) (300750.SZ) for a promising source of the ultra-light battery metal.
The bidding war comes amidst surging demand for lithium ion batteries used to power electric vehicles (EVs), with many global automakers planning to have fully electric fleets by 2035. There are not enough global lithium projects under development, though, to meet that target.
The Lithium Americas offer trumped a C$3.85 per share bid that CATL made in September, which in turn had outbid July's offer of C$3.60 per share from Ganfeng, the largest Lithium Americas shareholder.
Evans said he did not see the Lithium Americas offer as reflective of any broader fight between two Chinese companies for Argentina lithium assets.
"There's no geopolitical angle at all. We purely look at this as an exciting future," he said.
The nation's mining and battery companies acquired 6.4 million tonnes of lithium in reserves and resources in 2021, as of Oct. 18, nearly matching the 6.8 Mt of lithium acquired by all companies in 2020. China-based mining and battery giants have placed winning bids on five development-stage lithium projects valued at $1.58 billion, not including off-take and royalty deals, according to an analysis by S&P Global Market Intelligence.
Although China leads in global lithium processing and refining, it still sources the bulk of raw lithium products beyond its borders, including from Australia, Chile and Argentina.
Cybergovernance
Chile 🇨🇱 (+ Singapore 🇸🇬 + New Zealand 🇳🇿 )
China wants in on digital economy pact, pledges global collaboration | ZDNet - November 1, 2021
China has formally applied to join the Digital Economy Partnership Agreement (DEPA), pledging to work with all parties to drive the "healthy and orderly" development of digital economies. The global partnership pact currently covers Singapore, New Zealand, and Chile, with others such as South Korea and Canada expressing interest in joining the agreement.
In force since 7 January 2021, DEPA establishes common digital trade rules and seeks to drive interoperability between different regimes and digital systems of participating nations.
Under the agreement, businesses in Singapore, New Zealand, and Chile can achieve greater efficiencies, trust, and reduced costs when trading and conducting digital transactions with one another, said Singapore's Ministry of Trade and Industry. For example, digital identities could be mutually recognised, mechanisms would be developed to secure personal data transferred across borders, and common e-invoicing standards could be adopted to reduce processing time.
Environmental Conservation/Illegal, Unreported and Unregulated Fishing
Ecuador 🇪🇨 , Colombia 🇨🇴 , Panama 🇵🇦, Costa Rica 🇨🇷
New Galápagos Conservation Efforts Aim to Counter China Fishing Fleet - WSJ - November 5, 2021
Under a plan announced Tuesday, the governments of Ecuador, Colombia, Panama and Costa Rica said the famed Galápagos Islands would be united via a marine corridor with Colombia’s Malpelo Island and the Cocos and Coiba islands off Central America. The goal is to mark off a stretch of ocean twice the size of Arizona as off-limits to industrial fishing.
“The greatest thing about this is that it is the first multicountry protected area (in the world). It is a great step,” said Maximiliano Bello, an international ocean-policy expert for California-based Mission Blue who advised the Latin American governments. “We have technologies now that can help us protect the area and satellites that give us incredible information.”
The challenge, he said, will be protecting an expanse of ocean where there is little environmental oversight. “How do we make sure that the high seas...is not a wasteland, that is not the Wild West where there are no rules?” Mr. Bello said.
Though the Latin American governments didn’t single out China in announcing the new marine reserve, they have in the past complained about Chinese fishing fleets operating from Argentina north through Mexico. Environmentalists say hundreds of Chinese fishing ships plunder the waters off Latin America searching for giant squid, threatening the sustainability of a key source of the food chain for other maritime animals, including humpback whales, rays, giant turtles and hammerhead sharks.
Ecuador 🇪🇨
Ecuador to expand protected area around Galapagos Islands - Seafood Source - November 2, 2021
Ecuador will increase the area protecting the Galapagos Marine Reserve by 60,000 square kilometers, Ecuador President Guillermo Lasso announced at the United Nations COP26 climate summit taking place in Glasgow, Scotland.
The reserve will grow nearly 50 percent in size from its current 130,000 square kilometers, Lasso said. Ecuador’s newly created reserve would expand northward to include the Cocos Ridge and would completely ban industrial fishing in the reserve, as well as subsistence fishing in some areas. The move would be financed by a "debt-for-conservation swap," according to Lasso, whereby Ecuador’s external debt could be forgiven in exchange for local investment in conservation programs. He did not provide further information. The South American nation’s external debt is nearly USD 46 billion (EUR 39.7 billion), equivalent to 45 percent of the country’s GDP.
The Galapagos Marine Reserve is also one of the richest areas for marine life and a hotbed of life for the entire planet, yet it has been impacted by illegal, unreported, and unregulated (IUU) fishing. In July 2020, around 300 mostly Chinese-flagged ships began fishing near the exclusive economic zone around the Galapagos. For several months, the fleet continued to fish in the seas around South America, on the border of the exclusive economic zones of Peru, Chile, and Argentina.
IUU fishing by Chinese vessels receiving Chinese state subsidies has been discussed extensively in TCS July 2, June 5, March 26, and January 8. I am looking into who Ecuador is looking to finance this so called “debt-for-conservation swap”. Will it be the U.S. International Development Finance Corporation? If so, this would be a convenient coupling of environmental conservation and debt relief, while enlarging Ecuador’s protected area against IUU fishing.
5G
Brazil 🇧🇷
Brazil's awaited 5G tender yields billions in investment - AP - November 4, 2021
The auction was not yet finished on Thursday, but had already yielded pledges for over 30 billion reals (over $5 billion) in investment from mobile phone operators such as Claro, Tim and Telefônica, the owner of Vivo.
Overall, the government expects the auction, which could continue into Friday, to bring in as much as 50 billion reals.
Huawei, which was not participating in Thursday’s auction, might enter the game later on, experts and legislators said.