August 10, 2009

New Chinese accusations against Rio Tinto

Mining giant Rio Tinto, four employees of which are held in China, faced a new accusation its commercial spying cost China more than $100 billion in six years.

The accusation, contained in an article on a Web site affiliated with the Chinese state secrets watchdog, said the Anglo-Australian company, a major supplier of iron to Chinese steel mills, engaged in commercial spying for more than six years.

The Chinese agency said data on Rio Tinto's computers showed the espionage came at a huge loss to China, the state-run Xinhua news agency reported.

Last month, Chinese authorities in Shanghai arrested four Rio Tinto employees including its Shanghai general manger for alleged theft of state secrets. The company has said its employees did nothing unethical and did not bribe Chinese steel mills for information, Xinhua reported.

The latest accusation said Rio Tinto's commercial spying involved winning over and buying off, prying out intelligence ... and gaining things by deceit during a six-year period. The alleged spying meant Chinese steel makers paid more than 700 billion yuan (about $102.5 billion) more for imported iron ore than they would have paid otherwise.

Xinhua quoted a Rio Tinto spokeswoman in Australia as saying she was not aware of the new accusations and declined comment.

The arrests of the four employees came after Rio Tinto backed off a $19 billion investment deal with China's state-owned Chinalco. No official charges so far have been filed.