Rio Tinto employee accused of spying

• Source: Global Times
• [08:10 July 09 2009]
• Comments

By Zuo Xuan

Speculation buzzed in the media yesterday that China detained four Rio Tinto employees in Shanghai over the failure of a $19.5-billion deal with China's State-owned Chinalco.

The Chinese side was yet to respond at press time.

Australian Foreign Minister Stephen Smith said yesterday that Rio Tinto employee Stern Hu, Rio Tinto's iron-ore marketing chief in China, had been detained by Chinese authorities on suspicion of espionage.

But Smith said there was no evidence for drawing any link between the detention of Hu and any commercial matters concerning Rio, including its aborted $19.5-billion tie-up with Chinalco.

An unnamed employee of Rio Tinto's Shanghai office was quoted by the Sydney Morning Herald as saying, "They (the employees) did not show up in the office on Monday and now seem to have totally disappeared."

Rio Tinto refused to comment on the incident in an e-mail interview with the Global Times yesterday.

Ian Head, Rio Tinto's media officer, confirmed in the e-mail that four employees from Rio Tinto's Shanghai office had been detained, but said the reason is still unclear.

Ranya Alkadamani, a media liaison officer at the Department of Foreign Affairs and Trade of Rio Tinto, told the Global Times yesterday, "We are seeking urgent consular access (and are) not yet able to comment on the reason for his detention."

"Only one of the detained employees is of Australian nationality,"  he added.

Australian media reported on speculation that the detentions were linked to the alleged manipulation of the iron-ore market, while Chinese media have accused Rio of withholding products from the spot market to drive up prices.

One Australian politician, who had strongly criticized the Chinalco deal, said the incident showed the dangers of doing business with the Asian giant, according to AFP.

Zhou Shijian, former vice-director of China Chamber of Commerce of Metals, Minerals & Chemicals Imports and Exports, told the Global Times it is not rare in Western countries to capture business spies.

"If those employees are convicted of espionage, the case will strike an alarming chord to foreign companies – do not think you can do business in China by fair means or foul,"  Zhou said.

"But this single case will not affect relations between China and Australia," he added. "Australia is more open to China than some other countries rich in minerals."

Agencies contributed to this story