What's Ours Is Ores: Rio To China
The Age
Monday March 24, 2008
AUSTRALIA faces yet another wave of Chinese resources investment, this time at the personal invitation of Rio Tinto chief Tom Albanese.
As the mining giant fends off trade embargoes and insults from its vital Chinese steel customers and a hostile takeover bid from BHP Billiton, Mr Albanese today will ask Chinese state-owned enterprises for their help in developing 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 needed infrastructure."There are opportunities for co-operation on a joint-venture basis, or something equivalent to that, and I think that Chinese SOEs (state-owned enterprises) could be very much part of that picture," he said 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 steel makers, who are furious that an ever-growing revenue share is flowing to overseas companies.Industry leaders such as Sinosteel and Baosteel, as well as aluminium giant Chinalco and oil behemoth CNOOC, are searching Australia for resources. Their "go out" strategy is government 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 adventurous offshore investors have been plagued by allegations of corruption in the Philippines, of "hijacking" Chinese foreign policy in Sudan and disregarding community interests elsewhere in Africa.Mr Albanese said Rio's history showed "we are only as good in these areas as our weakest link".Strong corporate values would be a "win-win" for Chinese companies, he said, adopting a fashionable phrase in Chinese leadership circles. Mr Albanese said there was no "active engagement" with any particular company.Rio has three joint ventures with Chinese companies in Australia. Mr Albanese warned that Australia would miss out on resources investments unless state and federal governments fixed infrastructure bottlenecks.
© 2008 The Age