There’s no shortage of hype about China’s so-called resource buying frenzy – but a new report shows that Canada, not China, was the global leader in mining deals last year.
In 2010, North American companies accounted for approximately 52% of global merger and acquisition activity in the mining sector, according to a PwC report published Thursday.
Canada, which is a global hub for mining companies, accounted for 36% of that North American activity.
And China?
According to PwC, the Asian nation accounted for only 6% of global deal activity last year.
PwC said the numbers dispel the myth that China is buying up the world’s resources to feed its ever-expanding economy.
“A significant number of mining companies are domiciled in Canada, so it’s not surprising that they’re driving the deal activity,” John Nyholt, national leader of transactions services at PwC, told Business in Vancouver.
He said that Canada is not only home to the Toronto Stock Exchange, which is often considered the world’s premier resource-based exchange, but also global mining hubs such as Vancouver and Toronto, where hundreds of mining companies are based.
But even though Canada still leads the way, China’s mining sector has shown tremendous growth in recent years.
In 2004, the number of Chinese equity deals was negligible, but by last year they totalled close to $12 billion in value spread between 161 transactions.
Nyholt believes China will likely take a more aggressive approach to deal activity this year, and the country could go as far as to assemble the world’s first Chinese-owned diversified mining powerhouse.