Was A Rio Tinto Executive In China Just Arrested Because Iron Ore Prices Got Too High?

rio tinto china

Melbourne-based Rio Tinto recently reported record Q4 output thanks to robust Chinese demand. But doing business with China has its dangers too.

The very long arm of the Chinese law swept up four Rio Tinto employees last summer on suspicion of espionage. One of the employees, Stern Hu, was the director of Rio’s iron ore business in China and was in the middle of price negotiations.

His arrest may have to do with export prices that were rising and continue to rise, according to speculation by the New York Times and China Daily.

The four miners received charges today of accepting bribes and infringing trade secrets, according to Xinhua. They will face trial in front of a court in Shanghai, where as white collar criminals their penalty could be death.

However, don’t expect Rio to cut off it’s China action. Last week, the mining company named a new China operations chief who is fluent in Mandarin and known to be friendly to China, according to Xinhua.