Guinea's Chinese mining accord - deal or no deal?

* Mines Ministry officials question reported deal * Would allow Guinea to ignore international sanctions By Daniel Magnowski and Saliou Samb CONAKRY, Nov 10 (Reuters) - A reported $7 billion deal between Guinea and China Investment Fund (CIF) has left Guinean government officials in the dark and foreign diplomats worried the ruling junta could use the cash to ride out sanctions. The West African country's trade minister told a domestic website last month that Guinea was in talks with CIF, a Hong Kong-based group, about a minerals and oil deal. The Chinese government has since said it is not involved in any such investment, the group itself has not confirmed it, and Guinean officials could give no details. "I've not seen anything, I've not been part of any meeting," said Nene Moussa Camara, director of communications at the Mines Ministry. "I don't know anything." Guinea, the world's biggest exporter of aluminium ore bauxite, also produces gold, and is a potentially huge source of iron ore. Despite ownership disputes with successive governments, some of the world's biggest resources firms including UC RUSAL, Rio Tinto and Alcoa operate there. Mines Minister Mahmoud Thiam, previously accessible to journalists, returned neither telephone calls nor emails, and officials in the dilapidated ministry building did not know his whereabouts. Others within the ministry say they are increasingly being cut out of the loop by the National Council for Democracy and Development (CNDD), as the ruling junta calls itself. "Nobody has seen the deal. It exists, but nobody has seen it," said a senior official in the ministry who would normally expect to be party to negotiations. "In all these deals, the question is, 'what are we putting on the table?'," he told Reuters, speaking on condition of anonymity, and adding there had been no technical input from geologists, engineers or economists. "It's a political decision. For the sector, I'm worried. Important technical questions have not been answered." In general, such a deal would be signed by the Mines Minister and Finance Minister, and ratified by the President, he added. "BRAVO DADIS" Though the Economic Community of West African State (ECOWAS), African Union and European Union have imposed sanctions on Guinea, a deal of such magnitude -- Guinea's estimated gross domestic product was $10.6 billion in 2008 -- risks undermining the impact of such measures, and enabling the junta to retain power despite international isolation. "It depends whether you want to live under military force, or live the way the rest of the world does," said a Western diplomat, referring the options open to Guinea. A close aide of junta chief Captain Moussa Dadis Camara told Reuters at the weekend that China was "very interested" in Guinea, and that income from its mineral deposits would allow Guinea to ride out international sanctions. An editorial in 'La Nouvelle', an independent newspaper in Conakry, sarcastically applauded the supposed deal. "Bravo Dadis! It's that simple. You'll see that everyone will calm down soon ... ECOWAS is picking on you, but don't pay them any attention," it said. Foreign companies working in Guinea are wary of being seen internationally as supporting a violent regime, and equally nervous of the internal consequences of being perceived as critical of the CNDD. In practical terms, security of title has long been a risk in Guinea, but personal security is increasingly entering the calculations of investors from overseas, concerned by reports of indisciplined, violent soldiers, or criminals dressing in military uniform as a disguise. Several expatriate workers from mining firm CBG left Guinea last month. Local media have reported attacks on the manager of the Conakry branch of Gambia's First International Bank, as well as on African diplomats. "Personal security is part of the view. Lack of skills (locally) means you always have a degree of expat staff," said one foreign businessman in the capital. (Editing by William Hardy)