China’s largest gold mining company Zijin Mining is acquiring Canada’s Allied Gold in an all-cash deal valued at about $4 billion. This is the first major cross-border transaction since Canadian Prime Minister Carney’s recent visit to Beijing, which saw a thawing of several years of diplomatic tensions.
The announcement came as gold prices reached a record high, briefly topping $5,100 per ounce for the first time. As the uncertain geopolitical climate pushes demand for gold up, Chinese miners are viewing overseas acquisitions with increasing importance to offset limited domestic reserves.
Carney’s recent speech at Davos underscored a fundamental shift in geopolitics is underway, spurred on by Trump’s reshaping of international norms. Canada and other countries are clearly reviewing their relationship with China in view of the uncertainties and instability of the US.