Ross Greenwood speaks to Michael Smith, China correspondent with the Australian Financial Review, about how former Rio Tinto (ASX:RIO) Stern Hu’s release will affect Australia’s relationship with China, its largest trading partner.
Introduction: Former Rio Tinto executive Stern Hu ‘a free man’ after release from Chinese prison
Ross Greenwood: Let’s start the program by going to China. The reason for that is because there has been after almost eight years– Nine years, in fact, a big turnaround in the fortunes of the former executive of Rio Tinto, Stern Hu. Stern Hu, as you might recall, was sentenced to 10 years jail in March 2010, fined a million Yuan. This is as a result of allegations that he had tried to rig buying oil prices going into China. Michael Smith who’s The Financial Review’s China correspondent has just reported on this. Michael, Stern has been released from prison, is that correct?
Interview with: Michael Smith, China Correspondent, AFR
Michael Smith: Hi, Ross. How are you? Good. We’ve just had word that Stern Hu has in fact been released. We’ve been out of the prison all day. It’s called Qingpu Prison on the outskirts of Shanghai, where they hold most of the foreign prisoners. There was no sighting of him. We think he got whisked away out of a side door. China’s foreign ministry has just confirmed that he has actually been released. He’s been in there for nine years.
He was initially detained nine years ago, and then sentenced eight years ago, but he served a total of nine years. Had his sentenced cut slightly shorter, it was meant to be 10 years originally. There were a lot of calls for more leniency at the time, but that didn’t happen. He’s finally a free man. This was a huge story in the Australia-China relationship 10 years ago. It’s a pretty significant event.
Ross Greenwood: Well, it’s interesting to know that the Australia-China relationship right now is not particularly good. With many not only diplomats but also politicians not being given visas to travel to China right now. The released of Stern Hu comes at a very sensitive time. As you point out, when he was jailed and in many cases, China and Chinalco, the aluminum refiner in China, was refused being able to buy a stake in Rio Tinto and its iron ore operations. Again, that was the time when Stern Hu was jailed. This is now a sensitive time for his release and for whatever comes.
Michael Smith: Yes, that’s right. 2009 was a bit of a low point in the relationship. We’re almost back to those dark days at the moment. The relationship is very rocky on many levels. This particular case is probably not going to inflame the situation, but it does put a spotlight. It’s just another reminder of some of the issues that Rio Tinto was having here back then. It certainly won’t help things. The Australian government have been pretty quiet about his release, but they probably don’t want to draw too much attention to it at the moment.
Ross Greenwood: What’s expected to happen with Stern Hu? Is he staying in China or coming back to Australia? He’s an Australian citizen after all.
Michael Smith: Yes, that’s right. We’ve been told by sources close to the family that he has, in fact, sought permission to go and visit his elderly parents, they live in Northern China. We think he has obtained permission to actually spend another week in China to go and see them. There’s no official confirmation of that yet. We also believe his wife, who is an Australian citizen as well, is in Shanghai and he’s being reunited with her tonight. We think he will spend a little bit of time here, and then return to Australia. It probably wouldn’t be very safe for him to remain in China permanently. I don’t think that’d be an option for him. At this stage, the exact date of his return in Australia is a bit of a mystery.
Ross Greenwood: That’s going to be interesting to watch, there’s no doubt that it’s breaking news. We’ll find more details out of it as it comes to an end. Michael Smith’s report will be in The Financial Review tomorrow morning. Michael, I appreciate your time this evening.
Michael Smith: Thanks very much, Ross. See you later.
Image source: Rio Tinto