Rio Tinto says looking to grow China relationship

SYDNEY – Rio Tinto said Sunday it wanted to grow ties with China despite four employees being charged with bribery and industrial espionage, as rival BHP Billiton looked to the Asian giant to underpin growth.

Rio Tinto is increasingly looking to China for growth because of booming Chinese demand for raw materials but Beijing said last week that Rio Tinto executive and Australian passport-holder Stern Hu faces trial in Shanghai along with three Chinese colleagues on bribery and industrial espionage charges.’We would like to build relationships with China and I think that that can take place over a number of different areas,’ Rio Tinto’s chief financial officer Guy Elliott told Sky News.Chinese state-owned aluminium maker Chinalco is the biggest shareholder in Rio, the world’s third largest mining company.The four Rio employees to be prosecuted were detained last July during fractious iron ore contract talks between China and the miner.They are accused of using their ‘positions to obtain benefits for others and on many occasions solicited or accepted bribes,’ Chinese state news agency Xinhua has reported.Rio Tinto has previously said it is not aware of any wrongdoing by its employees while the Australian government and US and European business leaders in China have called for transparency in the prosecution of the four.The employees were arrested just weeks after Rio walked away from a massive cash injection from Chinalco, which would have given China an important presence in Australia’s vast resources sector.The case briefly snarled diplomatic ties between China and Australia, which have become major trading partners as the Asian giant seeks commodities and energy to feed its rapid industrialisation.Elliott said improving the company’s relationship with China was behind the decision to appoint Ian Bauert, who more than 25 years ago established Rio Tinto’s first office in the country, as managing director for China.’Ian Bauert is very experienced, speaks Mandarin, has spent a lot of time in China over the years and we hope very much that he, with his long experience, will very much contribute to that building of bridges,’ he said.China is a key market for both BHP Billiton and Rio Tinto, among the world’s top three exporters of iron ore, a crucial ingredient in steelmaking.BHP Billiton Chief Executive Marius Kloppers, said the Hu case had been a ‘great concern’, but added that China’s human rights record had to be balanced against its achievement in lifting hundreds of millions of people out of poverty.Kloppers said rapidly industrialising countries such as China would likely support growth in commodity prices, as developed economies emerged from the global slowdown more gradually.He said that while the mining giant was cautious about the global economy – despite last week announcing its half-year profit had more than doubled to US$6,14 billion – it was ‘relatively optimistic’ about commodity prices.Kloppers said his company had completed an analysis of China’s ramped up steel production and was confident that ‘this trend is going to go on for the 20 years that we forecast.’Kloppers said that benchmark iron ore prices were on track to rise this year despite global economic concerns, thanks largely to China’s continued growth.-Nampa-AFP

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