China frees mining giant Rio Tinto's former executive Stern Hu after 8 years for corruption

BEIJING/MELBOURNE (REUTERS) - Stern Hu, the former head of mining giant Rio Tinto’s China iron ore business, has been released from a Shanghai prison, China’s foreign ministry said on Wednesday (July 4), after serving eight years in jail following a 2010 conviction for corruption and stealing commercial secrets. 

Hu, an Australian citizen, was originally sentenced to 10 years in jail as tension flared between China, the world’s top user of iron ore, and its biggest supplier, Australia.

Fired by Rio in the aftermath, Hu is expected to return to Australia just as relations between the two countries cool to a fresh chill. 

Chinese foreign ministry spokesman Lu Kang told a daily news briefing in Beijing that Hu had been released on Wednesday. 

“While serving his sentence, Hu Shitai complied with prison regulations and discipline and submitted himself to education,” Lu said, using Hu’s Chinese name. “The Chinese justice organs reduced his sentence in accordance with the law.”

Lu did not say where Hu currently was nor when he might return to Australia.

Canberra passed new laws aimed at curbing foreign interference in Australia last week, after Prime Minister Malcolm Turnbull blamed China for meddling in domestic affairs last year. China denies meddling and says Australia has a “Cold War mentality”. 

The relationship between the two countries could deteriorate further if Australia bans Chinese telecommunications equipment maker Huawei Technologies Co from participating in a soon-to-be-built 5G broadband network. 

Hu was one of four defendants arrested by China and subsequently fired by Rio. The global miner conducted an internal audit but did not find any wrongdoing by the company itself. Rio declined to comment on Hu on Wednesday.

The four were convicted of accepting bribes in return for helping private Chinese mills secure access to relatively low-cost and stable term iron ore from Rio. They were also convicted of stealing commercial secrets that helped Rio in iron ore negotiations with Chinese mills, in proceedings that were closed to media and Australian diplomats. 

Hu’s sentencing raised questions in Australia at the time about China’s judicial process and business practices in the iron ore industry.

“Stern Hu’s arrest and the conduct of the trial was certainly the first big event that led people to focus on the difficulties of greater economic integration with China,” said Malcolm Cook, non-resident fellow at Australian think tank Lowy Institute.