Reuters top ten news stories delivered to your inbox each day.
You are here:
Business & Finance
The Great Debate
Do More With Reuters
Make Reuters My Homepage
Support (Customer Zone)
About Thomson Reuters
China holds Rio exec as spy; iron ore deal in doubt
Wed Jul 8, 2009 10:04am EDT
Email | Print |
| Reprints | Single Page
By Tom Miles and Fayen Wong
BEIJING/PERTH (Reuters) - Chinese authorities are detaining Rio Tinto Ltd's top iron ore negotiator on suspicion of espionage and stealing state secrets, Australia said on Wednesday, threatening to strain already fraying ties.
Details about the detention of Stern Hu, as well as three other Rio employees, emerged just as a Shanghai paper reported Chinese steel mills have finally given in on annual iron ore prices, conceding to a 33 percent cut for six months, although both Rio Tinto and Chinese executives said talks were ongoing.
It was unclear whether there was any tie between the two, but the detention follows a period of increasingly tense relations between the two vast trading partners, with iron ore negotiations running past the June 30 deadline and Rio snubbing a planned $19.5 billion investment by Chinalco last month.
"I see no basis in any of that speculation," Foreign Minister Stephen Smith told reporters in Perth in response to talk the move was related to iron ore or the Chinalco deal.
Smith also said he was very surprised by the detention and reasons for it and that the Australian government was still trying to seek access to Hu. He said there was the prospect Hu could be charged with criminal offences under Chinese law.
Rio, which first confirmed the detentions a day ago, said it was aware of the allegation.
"We have been advised by the Australian government of this surprising allegation. We are not aware of any evidence that would support such an investigation," a Rio spokeswoman said.
Rio said the Shanghai office where the detained staff worked was mainly a sales and marketing operation for the company, the world's second-biggest iron ore producer.
On June 5, Rio announced it had dumped plans for a $19.5 billion investment from state-owned Chinese metals firm Chinalco and instead sealed an iron ore joint venture with rival BHP Billiton.
Several days later, China's official Xinhua news agency slammed Rio's "perfidy" for scrapping the deal.
IRON ORE DEAL SAID
The intrigue over the four Rio Tinto employees threatened to eclipse the potentially bigger news of Chinese steel mills finally backed down on iron ore prices, agreeing to the same 33 percent price cut that Japanese and other mills accepted, according to a report in the Shanghai-based China Business News.
A deal would conclude some nine months of tense negotiations that threatened to scupper the decades-old annual pricing ritual and would frustrate China's efforts to wield more clout on global commodity markets, even where it is the dominant buyer.
But a Rio Tinto spokesman and several Chinese executives said negotiations were ongoing, despite widespread industry talk that of an agreement reached this week. Officials from the China Steel and Iron Association declined to comment earlier in the day.
"I've checked around this afternoon and there's still no deal so far, still negotiating," Tian Zhiping, vice general manager of the Hebei Iron and Steel Group, told Reuters. Dow Jones Newswires quoted Xu Lejiang, president of China's biggest steelmaker Baosteel, as saying talks were still going on with Continued...
View article on single page
Taliban kill 8 police, surround east Afghan office
also on reuters
Blog: Burqa losing favour as Afghan women opt for chador
FBI says mortgage fraud rampant and growing
Commentary: The dollar’s Tinkerbell moment
More International News
China's Hu abandons G8 as ethnic unrest continues
U.S. drones hit Pakistan militants; Taliban leader hurt
Indonesia's Yudhoyono wins second term; reform ahead
Pope shakes up office blamed for Holocaust denier
Iraq group calls for further attacks on U.S. troops
More International News...
A selection of our best photos from the past 24 hours. Slideshow
Most Popular on Reuters
U.S. mortgage fraud 'rampant' and growing-FBI
Critics laud love-laced Harry Potter film
Michael Jackson hailed as greatest entertainer, best dad | Video
Google takes aim at Microsoft with new PC platform
Putin praises Bush hospitality during Obama visit
New monkey discovered in Brazilian Amazon
China's Hu abandons G8 as ethnic unrest continues | Video
U.S. apartment vacancies near historic high: report
Gmail Finally Out of Beta!
Pickens backs off wind farm project: report
Most Popular Articles RSS Feed
Memorial fit for a king
China unrest resumes
Stocks slide on economy jitters
Sights, sounds from Jackson memorial
Fresh unrest in Chinese Uighur city
China tightens security in Xinjiang
China riots leave 140 dead
Jermaine sings for his brother
NY Jackson fans gather for memorial
Economy to take center stage at G8
Most Popular Videos RSS Feed
We want to hear from you
Join the Reuters Consumer Insight Panel and help us get to know you better
Please take a moment to complete our survey
Help and Contact Us |
Advertise With Us |
Site Index |
Thomson Reuters Corporate:
Professional Products |
Professional Products Support |
About Thomson Reuters |
Latin America |
United Kingdom |
Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.
NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.