Australian businessmen arrested in China for spying

July 9, 2009

On Sunday July 5, Australian businessman Stern Hu along with three other Rio Tinto employees were arrested by Chinese officials claiming they have evidence that the men damaged China's economy and security. The arrest come after the failed US$19.5 billion bid by state owned Chinalco to obtain an 18% stake in Rio Tinto and during the annual iron ore supply and price negotiations.

Tan Yixin, a senior executive of the Chinese steel maker the Shougang Group with close ties to the group, has also been detained for alleged crimes relating to the trade of raw materials. Chinese foreign ministry spokesperson Qin Gang cautioned Australia against politicising the issue. The maximum penalty for espionage in China is life imprisonment.

While Australian Trade Minister Simon Crean prepares to leave for meetings in Beijing over the issue, the Australian Labor Government has called for the opposition parties to discipline Nationals Senator leader Barnaby Joyce over comments linking the failed bid to the arrests as being grossly irresponsible. Opposition leader Malcolm Turnbull called on Australian Prime Minister Kevin Rudd to contact the Chinese government and demand that Hu, an Australian citizen, be released and granted access to consular officials.

On Thursday Xinhua News agency confirmed the arrests, the first official announcement since the group was detained on Sunday. The Xinhua News Agency also reported that a number of Chinese nationals have been detained and authorities are considering further investigations into China's steel production in the Shandong and Hebei provinces