Chinese Investment Revives Serbia's Century-old Mines
2021/04/06 6237

Note: this story was first carried on the overseas edition of the People’s Daily, on January 10, 2021.

Bor, a city located in eastern Serbia, thrives on copper. When modern copper mining began in 1903, the city developed rapidly on the back of its rich resource deposits.

However, due to its outdated equipment and inefficient management, the Bor copper mines were on the verge of bankruptcy. Their environmental problems cast a lingering shadow on the city.  

In December 2018, a Chinese company, Zijin Mining Group, signed a strategic cooperation agreement with the Serbian government, to operate the copper mines at Bor. In just a few months, the mines were transformed almost beyond recognition.

Aleksandar Vučić, President of Serbia, said the century-old mines have been reborn, thanks to Zijin’s efforts. “This is a great example of Chinese companies investing in Serbia, and I want to express my respect and gratitude with the most beautiful words,” said the President.

Reviving the Mines: Turning Money-losing Operations around in 6 Months

In the cold and snowy hinterland of the Balkans, the Bor copper mines are a scene of busy activities. Motors and machines rumble in plants, kept busy by more than 5,500 Serbian and Chinese workers.

By May 18, 2020, when one of the copper mines, once closed for over two years, was “activated” by Zijin, four copper mines and a smelter under the Bor Copper Project were all up and running.

Mining is a pillar industry of the Serbian economy. The Bor mines are the only producing copper complex in Serbia; they are also one of the largest employers of the country.

“Production of copper ore was severely constrained by greater difficulty in mining, outdated techniques and equipment. Coupled with low-grade ore and inefficient management, we faced grim difficulties in our operations” recalled Branislav Tomic, a mine manager who worked at the Bor copper mines for 22 years.

After taking over the mines, Zijin adopted technological innovations, and strengthened management throughout the production process. It worked to reduce the ore dilution and loss, and to improve recovery during mineral processing and smelting.

It also procured advanced equipment to develop IT-based, automated, and intelligent mining operations, significantly boosting efficiency, and cutting production and operation costs.

Yuvica Redisavlevich, Head of Production and Operation, said that in the six years following the takeover, Zijin will comprehensively upgrade and expand the mines and the smelter, to achieve economies of scale.

“In just three months, the Chinese company has gradually improved the production and operation indicators of the Bor copper mines, and in 6 months post acquisition, the mining operations became profitable. In fact, over the past two years, our profits have grown by several times”, said Redisavlevich.

President Vučić visited the projects three months after Zijin’s takeover. He was impressed by the tremendous changes that took place in such a short period of time.

“Zijin Mining brought in a respected team of professionals, and saved this ailing state-owned enterprise from bankruptcy. The Bor copper mines have since improved rapidly in terms of production and operation, and have become a driving force for economic growth in eastern Serbia”, he said. 

Improving the Environment: Restoring Lucid Waters and Green Mountains 

Bare hills, grey plants, and the dust-covered faces of miners were common scenes to residents living near mine sites. Bor was once seen as a dusty, cloudy city, with mud flowing in its waters.

Zijin, upon arrival in the city, did a lot to tackle the environmental problems. Mijana Marić, Manager of Environmental Protection, said: “Zijin has brought advanced concepts in environmental protection, and carried out many afforestation programs and environmental protection projects.”

Thanks to these efforts, 61,300 trees have been planted along the slopes of all tailings dams, open-pits, and those of some abandoned dump sites, adding 349,000 square meters of green space. The mining areas have taken on a new look.

Zijin also took steps to control dust, solid waste, wastewater and exhaust gas, achieving clear results. The reinforcement of old drainage culverts and the construction of new flood discharge systems are underway.

By late December 2020, Zijin has invested US$ 76.58 million in environmental protection.  

“I’ve never expected mine sites to be so beautiful,” said Rajokovic, a Bor resident. In the past, when strong winds blow, dust came right from the slopes of tailings dams, and spread in the air.

That seriously affected the quality of life of residents nearby. Now, these slopes are covered by green vegetation. Rajokovic praised it as “a new model of green mines”.  

Ivona Lađevac, head of the Regional Center the “Belt and Road” at Serbia’s Institute of International Politics and Economics, said in an interview that “the Chinese company followed the concept of green development throughout the development and use of mineral resources. It has achieved a balance between economic, environmental and social benefits during the development of the Bor copper resources. And it has also set an example for other mining cities and for green production. The company have both revived Bor’s resource-rich mines, and restored clear waters and green mountains for residents of the city”.

Creating Jobs: A Booming City and Better Lives

Copper mines were the main driver of Bor’s economy. With the mining operations losing money for years on end, the city’s economy suffered, leaving many young people jobless.

As Zijin took over the mines and invested in the Čukaru Peki copper-gold mine, local employment is no longer a headache. As of late December 2020, 5,451 Serbian employees work at two projects of the mines.

When Čukaru Peki is put into operation in 2021, another 1200 jobs will be created.

“The Chinese company has changed the life of my family. With the ‘rebirth’ of Bor mines and the development of Čukaru Peki, our city and villages have become more dynamic. More and more young people have returned, to work in their hometown. The city is thriving and our lives are getting better”, said Dragan Todorović, a Bor resident.

“Two years ago, our average monthly income was 68,160 dinars (702 dollars). Now it has risen by more than a third, well above the national average” said employee Igor Miserovic, who is happy with working at the mines.  

Zijin Mining has also worked actively to fulfill its social responsibilities, supporting the development of local health care, education, culture, sports and infrastructure. It also donated complete equipment to the second “Fire Eye” virus testing lab in Serbia.

More than 30 mining-related Chinese firms have followed Zijin’s footsteps to invest and do business in Serbia, bringing commercial opportunities for nearly 100 Serbian companies and contributing to Serbia’s economic development and job creation.

Aleksandar Antić, former Minister of Mining and Energy of Serbia, commented: “Zijin saved more than 5,000 jobs, and significantly increased the income of their employees. It has also been engaged in charity, and in serving the interests of the public. The Serbian government has made the right choice.”