EXPOSURE TO CHINA
Sales are made to a limited number of customers in China, particularly in respect of copper concentrate output. Treatment and refining charges are dependent upon Chinese smelting capacity and the level of copper concentrate supply in the region. China is an important source of financing to the Group with long-term debt facilities of $2.4 billion at 31 December 2019. In addition, the Group uses contractors, services and materials from China.
The Chinese economy and its outlook have been negatively affected by global trade tensions and the emergence of the Covid-19 coronavirus. Restrictions on the movement of goods, people and services could impact the Group’s operations and projects, the availability of Chinese credit and its demand for commodities.
Aktogay and Bozshakol produce a copper concentrate that is attractive to Chinese smelters, being ‘clean’ and high in sulphur content. The Group has established good relationships with strategic customers in China.
The Group maintains relationships with a number of international lending banks, has facilities in place with the PXF syndicate, DBK and CAT Financial, and has the flexibility to consider other sources of capital if required.