Rio Tinto reported on February 11 that it had been advised the People’s Procuratorate in China had transferred the case relating to the company’s four Shanghai employees, detained since July 5, 2009, to the Shanghai Number One Intermediate Court for trial. A trial date had not been set. The charges related to receiving bribes and stealing commercial secrets. Those indicted include Stern Hu, an Australian citizen who headed Rio Tinto’s Shanghai office and who is originally from China, and Chinese citizens Liu Caikui, Ge Minqiang and Wang Yong.
Sam Walsh, chief executive Rio Tinto Iron Ore, said, “We are very concerned about the nature of these charges; however, as this is part of an ongoing legal process, it is inappropriate to comment any further.” Rio Tinto continues to hope for a transparent and expeditious process for its employees, the company’s statement said, and senior managers from Rio Tinto continue to maintain regular contact with the families of the detained employees and to provide support to them.
About a week prior to the announcement of the indictments, Rio Tinto appointed Ian Bauert as its managing director for China. Bauert speaks fluent Mandarin and established the company’s first office in China more than 25 years ago. He will lead Rio Tinto’s team of 160 employees in Beijing, Shanghai and Guangzhou. His most recent role was managing director, sales and marketing, iron ore. He started his career at Rio Tinto more than 30 years ago and has held various positions including managing director, Dampier Salt; and managing director, new business, iron ore.
Rio Tinto CEO Tom Albanese said Bauert’s new role underlines the importance the company places on enhancing its relationship with China. “I am deeply committed to developing our relationship with China. Ian’s experience and leadership will provide strategic direction and help guide all aspects of our engagement with China, one of our most important partners.”
Regarding the four indicted Rio Tinto employees, China’s Xinhua news agency reported that a court statement said prosecutors had accused the four of “taking advantage of their position to seek profit for others, and asking for, or illegally accepting, huge amounts of money from Chinese steel enterprises.” The report said they had lured the heads of Chinese enterprises with promises, or through other illegal means, to obtain steel companies’ commercial secrets on multiple occasions, causing “extremely serious consequence” for the companies.
News reports elsewhere in the world, especially in Australia, emphasized the uncertainty that the case raises for companies doing business in China and the need for transparency in China’s handling of the case.
South Africa Drops to Third in World Gold Production
Global gold mine production grew by 6% in 2009 to a six-year high, but South Africa—once the largest producer in the world—saw its production levels fall by 5% and consequently to third place behind China and Australia in the league table of gold producing countries, according to figures released by precious metals consultancy, GFMS, which analyses production levels in all producer countries.
Although still short of production peaks reached in the early years of the decade, GFMS forecasts that mining output will grow again in 2010, as new mines increase production, outweighing the declines in more mature producers like South Africa and the United States.
Despite the decline in South Africa, which was the nation’s smallest decline in 5 years, output in the African region overall grew by 4%. Four of the world’s top ten global output increases came from the region, led by a doubling in output in Burkina Faso.
The South Africa picture was mixed. Several accidents which necessitated closures hit production, but some mines showed their first gains for many years.
Internationally the fastest growing output figures were posted by Indonesia, Tanzania and China. World output was 2,553 mt in 2009, compared with 2,409 mt in 2008. This 6% increase in mine production was far outstripped by a 26.6% increase in the supply of old gold scrap to a record high of 1,541 mt.