In the afternoon of September 12th, the first World’s Top Mining Companies Summit commences during the first China Gold Congress. Leaders from China’s and world’s top mining companies discuss about how to cope with current challenges the world gold mining companies are facing, overseas merger and acquisition and future development of gold industry. General manager and secretary of party committee of China National Gold Group Corporation, Song Xin, attends the summit and has in-depth talks with other companies. Vice general manager and chief accountant, Liu Bing, delivers a topical speech at the summit.
To quote Mr. Song Xin: “China National Gold Group Corporation is the only central state-owned enterprise in China’s gold industry, with a long history of producing gold. Its predecessor is China Gold General Corporation established in 1979. In 2002, China Gold was set up under approval of State Council. From then on, China Gold has realized its leaping development by following the market and revising its strategies. China Gold now is a large mining company integrating geologic exploration, mining and exploitation, mineral dressing and smelting, refining, manufacturing and sales, scientific and technological research and development, engineering designing and construction. It owns a full production chain and enjoys its exceptional advantages in resources, technologies, human resources and reputation. As a leading company in China’s gold industry, China Gold ranks No.1 in China in 6 indices regarding gold resource reserve, mineral gold output, refined gold output, gold investment product market share, gold mineral dressing and refining technologies and volume of physical gold traded in Shanghai Gold Exchange as a comprehensive member.”
He adds: “In face of gold price downturn, China Gold makes efforts on reform and innovation, and takes precautions against influences caused by fluctuated gold price. As for existing subsidiaries, China Gold taps their potentials from every aspect, takes measures on optimizing five rates, cost cut and efficiency promotion and cost control. As for construction, technological transformation and geologic exploration programs, it follows the guideline of “infinite process of construction and optimization” and constantly carries out optimization of designing and investment so as to control cost from the very beginning. As for human resource management, it learns from big international companies and streamlines its structure. Besides, China Gold gives attention to talents reserve building to cultivate capable teams of managers and technicians. As for corporate management, it upholds the idea of “details determine future success or failure,” enhances inner management and promotes detailed management and operational quality and efficiency. As for financial management, China Gold uses multiple financial tools to finance through different channels. Overall, China Gold is consolidating its inner strengthen and relying on reform and innovation for growth to sustain corporate comprehensive competiveness and capabilities against market risks. Although the road ahead is ridden with obstacles, the future is still bright. I am confident no matter how good or bad the situation is, China gold can deal with it confidently”.
When asked about his ideas on overseas merger and acquisition, Song Xin comments that we need to seize good opportunities and control our pace when going global, and make it a gain not a loss. Any merger and acquisition should be made for substantial value creation. This is how going global should be.
He calls for companies going global to seize the best opportunities in accord with their own situation. First, before going global, it should consolidate its growth foundations in China. Second, when going global, it should be mentally and financially prepared with sound human resource base and especially cross-cultural management capabilities and forges ahead in a gradual manner. Third, after being successful in going global, it should play by the international mining rules and regional regulations, take on social responsibilities. More importantly, it should highly emphasize safety and environmental protection and rely on science and technology and investment in environmental protection for growth. Only by building a green and environmental friendly pilot company, can it sustain its coordinated development.
Mr. Liu Bing talks about China Gold’s overseas resources development in going global and transformation and updating of gold producers under new circumstances at the summit.
To quote Mr. Liu: “As a central state-owned enterprise in China’s gold industry, China Gold always takes on the duties of safeguarding China’s financial security against financial and economic risks, and leading the cause of industrial sciences. Over the last few years, China Gold has set up two public listing platforms home and abroad. It has laid down the structure of seven major business sectors including Zhongjin Gold, China Gold International, Zhongjin Jewelry, Zhongjin Contruction, Zhongjin Resources, Zhongjin Irradiation and Zhongjin Trade and set its foot on going global. ”
Mr. Liu mentions that China Gold International is the only overseas public listing platform of China Gold, and also the first central state-owned red chip mining company listed in Toronto and Hong Kong. In a few years, China Gold International has sustained its profits increase by 33 times while net asset by 34.7 times with greater influences in North America and international capital market through measures include mineral prospection, expanding reserve and scale, cost cut and efficiency promotion, scientific and technological innovation and detailed management.
Mr. Liu adds that China Gold picks up its exploration of overseas resources, and sets up offices or companies in Kazakhstan, Kyrghyzstan, Republic of Congo and Hong Kong which can provide the latest about deposits and the market. It purchased the Kuru-Czech Gailieke copper and gold mine in 2011 and signed contracts on the Republic of Congo Soremi copper, lead and zinc deposit in 2013. China Gold has increased its ownership of overseas resources. Now, it has 100 tons of gold, 1.3 million tons and 1 million tons of lead and zinc, having realized its low cost expansion in the overseas mining market. It is worth noticing that China Gold wins the BBB credit rating by the world’s two largest credit rating consulting firms, Standard & Poor’s Corporation and Moody’s. It is the first time that a company from China’s gold industry wins the highest credit rating in the world’s gold market.
Mr. Liu Bing comments: “Stones from other hills can serve to polish jade of this hill. While going global, China Gold reinforces its international cooperation, learns from advanced management ideas and scientific and technological achievements of large international mining companies. It connects itself with world’s leading companies and fully plays its own advantages to promote healthy development of the gold industry.”
Vice general manager Liu Congsheng also attends the summit at invitation.