Rio Chief Wants Helping Hand From Chinese To Invest
Sydney Morning Herald
Monday March 24, 2008
AUSTRALIA may be in for another wave of Chinese resources investment, this time at the personal invitation of Rio Tinto chief Tom Albanese.
As the miner fends off trade embargoes and insults from its crucial Chinese steel customers, as well as a hostile takeover bid from BHP Billiton, Mr Albanese will today ask Chinese state-owned enterprises (SOEs) for their help in developing new mining and infrastructure projects in Australia and around the world.Mr Albanese said his company was "without peer" in finding world-class ore deposits, but development was expensive and required significant infrastructure. "There are opportunities for co-operation on a joint-venture basis, or something equivalent to that, and I think that Chinese SOEs could be very much part of that picture," he told reporters in Beijing, in a preview of a peace offering he will make to the China Development Forum today.Mr Albanese said he was "philosophical" about insults levelled at him from steel association leaders last week. But today's invitation is squarely aimed at mending relations with China's politically powerful steelmakers, who are furious that an ever-increasing revenue share is flowing to overseas mining companies. Industry leaders like Sinosteel and Baosteel, as well as the aluminium giant Chinalco and oil behemoth CNOOC, are aggressively scouring Australia for new resources. Their "go out" strategy is official policy. But Mr Albanese's invitation comes with a catch: state-owned companies with substandard governance or environmental standards need not apply. "Our partners have to work with us in a manner that is consistent with our principles on corporate governance, work safety, welfare, local community engagement, environmental protection, principles in the way we work and that all-embracing area that we would call sustainable development," he said. Some of China's cashed-up and newly adventurous offshore investors have been plagued with allegations of corruption in the Philippines, of "hijacking" Chinese foreign policy in Sudan and disregarding community interests elsewhere in Africa. Mr Albanese said Rio Tinto's history showed "we are only as good in these areas as our weakest link". Insisting on strong corporate values would be a "win-win" for Chinese companies, he said, adopting a phrase in vogue in Chinese leadership circles.
© 2008 Sydney Morning Herald