Canada did not stop a Chinese firm’s bid for a Toronto-listed lithium miner because it saw no risk to national security, Innovation Minister Francois-Philippe Champagne said on Thursday.
The opposition Conservatives said the Liberal government should have blocked Zijin Mining Group Co Ltd from buying Neo Lithium Corp for C$918.7 million ($721.3 million) last year.
The Conservatives say the decision to permit the purchase makes no sense at a time when Washington is working with Canada to boost regional supply chains of critical minerals to counter China’s dominance.
Although Neo Lithium is listed on the Toronto exchange, its operation consists of a proposed mine in Argentina, where most of its employees are based.
“There was sufficient information to make a determination … that no national security harm could arise as a result of this transaction,” Champagne told the House of Commons industry committee.
Neo Lithium’s reserves are comprised of lithium carbonate whereas electric vehicle battery producers prefer lithium hydroxide, he added.
Last March, Canada tightened foreign investment rules to protect the security of supply chains ahead of an expected surge in demand for metals used to make electric vehicles.
This story originally appeared in Reuters
