Mining giant Rio Tinto Ltd yesterday shrugged off global concerns about the US economy, saying that even if the US falls into recession it would do little to slow the Chinese economic juggernaut driving the commodities boom.
Chief executive Tom Albanese gave a bullish presentation of Rio Tinto's prospects yesterday as the deadline for a formal takeover offer from its rival BHP Billiton Ltd looms.
The Chinese economy is becoming less dependent on the slowing US economy, he said, and would still grow about 10 percent this year even if the US went into recession.
Rio Tinto expects growth in China of between 10 percent and 11 percent this year, and Albanese said growth of 9 percent in the longer term looks sustainable, with the focus increasingly on domestic demand.
Baker Young Stockbrokers associate director Wesley Legrand said Albanese's comments on China show Rio Tinto believes the commodities boom is far from over.
"The world's biggest players are sending a clear message that the underlying long-term fundamentals are intact and that this unprecedented resource boom is structural rather than cyclical in nature," Legrand said.
In a media presentation, Albanese gave an upbeat assessment of his company's outlook and the prices of the commodities it produces.
"From 2008 onwards Rio Tinto is poised for exceptional growth as we reap the rewards of investment in exploration, resources, infrastructure, technology and people consumption," he said.
BHP is offering three of its shares for every Rio Tinto share -- an offer currently worth about US$105 billion -- a proposal Albanese has dismissed as "not in the ballpark."
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