Ban on Sale of  Mining Rights to be Withdrawn Pang Bo, journalist of  the China Daily

    In order to reinvigorate the mining sector and attract more overse
as investment, China is moving towards allowing the transfer of  minin
g rights on the market, according to official sources.
    Under the new policy, the government will set up a market mechanis
m for the buying and selling of exploration and excavation rights for 
mineral resources, Jiang Chengsong, Vice-Minister of  Geology and Mine
ral Resources, said recently.
    State-owned mineral companies used to depend on the government for
 fund allocation, but a shortage of  cash has hindered development in 
the sector.
    Under the current State budget for the industry, by the year 2000 
supply of about one-third of the 45 major mineral products will run sh
ort of the demand for national economic development, and the figure is
 expected to increase to two-thirds by 2010.
    Mining companies abroad typically sell or lease their exploration 
or excavation rights when they face shortage of  cash.
    However, Chinese firms, which posses mining rights free of charge,
 are currently not allowed to transfer them on the market.
    Allowing the sale of rights is expected to increase interest from 
oversea investors in the sector so long as the draft amendments to the
 Law on Mineral Resources are approved by the National People¡äs Congr
ess.
    The draft amendments, which have been submitted for deliberation t
o the on-going 20th Meeting of  the Standing Committee of the Eighth N
ational People¡äs Congress, China¡äs top legislative body, define clea
rly the legal status of foreign minerals firms.
    The lack of legal status and restrictions on the transfer of minin
g rights are greatly hindering overseas investment in China, according
 to Shao Juenian, a senior official from the international co-operatio
n department of  the Ministry.