Australian Prime Minister Kevin Rudd yesterday warned China that the world is watching how it deals with an investigation into four detained employees of Anglo-Australian mining giant Rio Tinto Ltd.
Rudd urged China to consider its economic ties with other countries as it dealt with the men, who have been held since July 5 on espionage charges. Three are Chinese nationals and one is an Australian citizen.
“Australia of course has significant economic interest in its relationship with China,” Rudd told reporters in Sydney. “Let me also remind our Chinese friends that China, too, has significant economic interests at stake in its relationship with Australia and with its other commercial partners around the world.”
China is Australia’s biggest trading partner.
Rudd said it was in the best interests of all countries to resolve the matter.
“A range of foreign governments and corporations will be watching this case with interest,” Rudd said. “They’ll be drawing their own conclusions as to how it is conducted.”
Australian Stern Hu (胡士泰), an executive for Rio Tinto Ltd, and the others were detained on July 5 amid contentious iron ore price talks with Chinese steel mills. State media say they are accused of bribing Chinese steel company employees to obtain confidential information on China’s negotiating position in the talks.
Rudd confirmed that the Australian government had not received a direct briefing from the Chinese on why Hu had been detained.
The detentions have complicated the price talks between China and iron ore suppliers and raised concerns of a disruption in the industry, as China is quickly becoming the main global consumer of iron ore.
Chinese Commerce Ministry spokesman Yao Jian (姚堅)said yesterday the spying charges would not affect investment in China.
“The confidence of foreign investment in China’s legal environment has strengthened during China’s 30 years of opening up,” Yao said.
“This single case won’t affect China’s trade and capacity of attracting foreign investment at all,” Yao said at a news conference on China’s latest foreign direct investment figures.
One part of the row may be quietly put to rest after sources said the two major miners, Rio and BHP Billiton, had secured tacit agreement with Chinese mills for a 33 percent price cut in iron ore, the same deal agreed with other Asian customers in May, effectively winning the marathon pricing battle.
The sources, including people on both sides of the negotiations, said some mills had agreed to a six-month contract and some a year, but there would be no formal announcement by the China Iron & Steel Association, which represented big Chinese steel makers in this year’s talks.