China to invest despite crackdown: envoy

China’s ambassador says the country will continue to do business in Canada’s domestic critical minerals sector despite Prime Minister Justin Trudeau’s “unfortunate” crackdown on foreign investment.

Ambassador Cong Peiwu said the Canadian government is “wrong” to prevent Chinese investors from buying majority stakes in domestic mining companies, like it did in 2022 when it forced three Chinese stateowned firms to divest from a trio of lithium companies.

“Politicizing normal commercial co-operation and using national security as a pretext for political interference is wrong. China has expressed firm opposition to this,” said Cong in an interview with Bloomberg News on Wednesday.

“We’ll continue to do business on the basis of mutual respect and mutual benefit.”

The comments follow remarks by Canada’s Natural Resources Minister Jonathan Wilkinson last week warning miners that Chinese stakes will face strict national security reviews.

Chinese investment has continued to flow through Canada’s mining sector more than a year after Trudeau moved to tighten its foreign ownership rules. This year alone, Zijin Mining Group Co. initiated plans to buy a 15 per cent stake in Canadian copper company Solaris Resources Inc., Ganfeng Lithium Group Co. Ltd. moved to take a 15 per cent stake in Vancouver-based Lithium Americas Argentina Corp. and Yintai Gold agreed to buy gold explorer Osino Resources Corp. for $368 million.

Canadian government officials, speaking on condition they weren’t named, have told Bloomberg they are tracking the issue closely and are considering whether further measures are needed beyond the current national security review regime.

China has found an ally in Canada’s cash-strapped junior mining firms, some of which have called on Ottawa to relax tougher rules on Chinese investment as the sector struggles to raise capital with commodity prices are low.

“Critical mining is about those materials to be used in sectors like new-energy vehicles,” said Cong. “That’s good for the whole world. We’re talking about coping with climate change.”