Four Rio Tinto staff held on suspicion of spying

Chinese officials have arrested four employees of Australian miner Rio Tinto on charges of spying and stealing state secrets, the official Xinhua news agency says.


AFP - Four employees of Anglo-Australian mining giant Rio Tinto have been detained in China for allegedly stealing state secrets, the Shanghai branch of the state security ministry said Thursday.

A spokesman confirmed an Australian national named Stern Hu and three Chinese citizens were being held, but declined to comment further.

Australian Foreign Minister Stephen Smith told reporters Wednesday that Hu was being held on "suspicion of espionage and stealing state secrets".

A Beijing-based Rio Tinto spokeswoman described the allegations as "surprising" and said she found out about them from the Australian government.

"We are not aware of any evidence that would support such an investigation," the spokeswoman said in an e-mailed statement.

"We will continue to work to support our employees and their families," she said, declining to comment further.

Rio is the world's second largest iron ore producer and its Shanghai office, where the men worked, focuses on sales and marketing to China.

Rio has been leading tough Australian negotiations with China over this year's benchmark price for iron ore contracts, which missed a key deadline last week.

China, the world's biggest iron ore consumer, has been seeking a deeper discount than the 33 percent negotiated with Japan and South Korea, while Rio says its customers are welcome to buy at spot prices.

Tensions between China and the miner rose after Rio dumped a proposal from its largest shareholder, state-owned Chinalco, to inject 19.5 billion dollars into the firm in favour of a rights issue and joint venture with BHP Billiton.

After the deal soured, Beijing threatened to undertake an anti-monopoly review of the BHP-Rio joint venture while official Chinese media put its failure down to Australian "prejudice".

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