In a move that has caught headlines lately, the U.S. government has struck talks to launch a $5bn mining investment fund, which, by the way, happens to be its largest potential move yet, so as to secure the supplies of critical minerals.
The International Development Finance Corp. (DFC) happens to be negotiating with Orion Resource Partners, who are based out of New York, in order to set up a joint venture, reported Bloomberg News on September 16. Apparently, the discussions are currently on, and no deal has been finalized as yet.
The $5bn mining investment fund plan goes on to reflect the push by Washington to reduce dependence on Beijing, which happens to dominate mineral processing and also continues to get hold of assets across the world. Both the Trump administration and Orion have stressed the requirement for Western governments to play a major role when it comes to mineral markets.
The International Development Finance Corp. (DFC), which was created in the first term of Trump, has already backed numerous mining projects, which include the loans for graphite production in Mozambique and also railway upgrades across the copper belt of Africa. If given the nod, the Orion venture could very well become the largest-ever commitment by the agency.
Interestingly, Orion, which happens to manage around $8 billion in assets, has in the past partnered with sovereign wealth funds and is at present eyeing deals in the Democratic Republic of Congo, which apparently is the leading cobalt supplier in the world. The proposed U.S. collaboration would be a reflection of the arrangements made in the past, with each side contributing the same amounts for the $5 billion total.
The DFC is anticipated to expand its mandate in the second term of Trump, potentially doubling the investment capacity it has and also taking on higher-risk projects so as to attract private capital, opined Bloomberg News.