July 10, 2009 Friday
Updated

July 10, 2009
Aussie officials to meet 'spy'
Stern Hu is a senior employee of Rio Tinto. -- PHOTO: REUTERS

SYDNEY - AUSTRALIA on Friday was to gain its first access to a top mining executive accused of spying in China, as Prime Minister Kevin Rudd rejected calls to intervene in the highly sensitive case.

The Mandarin-speaking Rudd stressed the need for caution in the arrest of senior Rio Tinto employee Stern Hu, which is testing one of Australia's most important diplomatic and trade relationships.

'With all complex consular cases, we have to proceed cautiously on the basis of the advice as it unfolds,' Mr Rudd, a former diplomat, told public broadcaster ABC.

'What we've already done in Beijing and Shanghai and Canberra is make strong representations for access to this Australian citizen.' Australian officials were set to meet Hu in Shanghai, five days after his arrest by China's anti-spy agency along with three Chinese colleagues.

China on Thursday said it has evidence the four stole state secrets and caused 'huge losses' to its economy and security.

The arrests have prompted intense speculation over a link to Rio's role in troubled iron ore talks with Beijing and its decision last month to walk away from a massive offer of Chinese cash.

'Our challenge in the immediate period ahead is to establish all the facts,' Mr Rudd said, dismissing opposition challenges to intervene. 'We're going through that with the Chinese now and it will take some time.' Foreign Minister Stephen Smith earlier said he had seen no suggestion that Hu's detention was linked to Rio's recent dealings with China.

Last month, the debt-laden miner turned down a US$19.5-billion (S$28.4 billion) cash injection from Chinalco after deciding that rising commodity prices made a rights issue and joint venture with BHP Billiton more attractive. Rio has also been locked in tough negotiations with China to set annual iron ore prices after a key deadline expired on June 30.

In Beijing, police also arrested Tan Yixin - the head of iron ore trading at Shougang Group steel company, who had 'close contact' with Rio's Hu - for suspected commercial crimes, the 21st Century Business Herald reported.

On Thursday, Australia's foreign ministry summoned the acting Chinese ambassador, Mr Hong Liang, over Hu's arrest. Australian Foreign Minister Stephen Smith scheduled a press conference for 0200 GMT on Friday to discuss the case. -- AFP

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