Chinalco president Down Under

Chinalco's $30 billion dollar deal with Rio Tinto will not jeopardise Australia's control over its own natural resources, president Xiong Weiping told reporters in Sydney.

Chinalco’s $30 billion dollar deal with Rio Tinto will not jeopardise Australia’s control over its own natural resources, president Xiong Weiping told reporters in Sydney.

“This transaction will in no way lead to any control of the natural resources in Australia,” he said.

“Our partnership will in no way change the corporate strategy of Rio Tinto or the way it operates its business, or the pricing of its product.

“In this transaction, Rio remains as an independent company.”

Chinalco’s planned purchase of Rio Tinto’s iron ore, aluminium, bauxite and copper assets, has raised fears of Chinese state-owned companies controlling major portions of the country’s key resource assets, potentially influencing commodities prices.

Xiong, who officially took over as president of the state-owned Chinalco last week, has flown to Australia in order to lobby the Federal Government to approve his company’s proposed deal to purchase 18% of Rio.

In his first overseas act as president, Xiong is today expected to meet with Treasurer Wayne Swan and the Foreign Investment Revue Board (FIRB) to discuss the deal.

Xiong has indicated that despite any reticence from Australian markets about the deal, he does not plan on making any changes to its structure.

“We do not want to see any changes to this packaged agreement,” he said.

According to Xiong, Chinalco’s rescue package for Rio should be beneficial to the Australian mining sector, boosting the economy and creating jobs.

“Hopefully the deal will be beneficial to Australia in terms of helping it withstand the impact of the global financial crisis and to its economic recovery,” he said.

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