China steel association opposes Rio-BHP iron ore JV

Rio Tinto's backdown shows short-sightedness, prejudice

Chinese companies will continue to pursue the principle of equality, mutual benefit, friendship and honesty in carrying out trade and investment outside China, Foreign Ministry spokesman Qin Gang said here Tuesday.

In response to a question about Rio Tinto's withdrawal from a deal with Aluminum Corporation of China (Chinalco) at a routine press conference, Qin said the Chinese government has always supported Chinese companies to carry out international cooperation according to market rules and international practice.

According to the official website of Chinalco, the Australia-based mining giant has withdrawn on a 19.5 billion U.S. dollar alliance that Rio Tinto and Chinalco reached on Feb. 12.

"We are filled with strong disappointment about this outcome," Chinalco said in an online notice dated June 5.

Rio Tinto announced on June 5 that it will pay 195 million U.S. dollars to Chinalco for separation according to an earlier agreement.

Qin said the unilateral decision of Rio Tinto has not only rendered disappointment from the related Chinese company, but also caused strong repercussions from relevant industrial sectors and the public in China.

Rio Tinto said it will form a cooperative venture with BHP Billiton, which would pay Rio Tinto 5.8 billion U.S. dollars to set up a joint venture to run the iron ore resources of both companies in west Australia.

Source: Xinhua