Australia says 'internal pressure' helped Rio case

SYDNEY: Australia on Thursday said its "internal pressure" helped persuade China to downgrade an espionage case against detained Rio Tinto mining executive Stern Hu.

Trade Minister Simon Crean said Hu's formal arrest on charges of business bribery, rather than more serious allegations of stealing state secrets, reflected a "lesser" case.

"We think that the pressure that we've been applying internally has had something of an impact," Crean told reporters ahead of his departure for an ASEAN summit in Bangkok.

"Clearly, we will continue to keep that pressure up and if my counterpart comes to Bangkok, as I expect he will, then I will have the opportunity again to raise this matter with him, as I did a couple of weeks ago."

Crean said the "unfortunate distraction" of Hu was not hurting bilateral trade with Beijing, which was worth 58 billion dollars last year. But he warned it could harm business relations, if it dragged on.

"I don't think it's having an impact on the bilateral relationship," said Crean.

"I think unless it's resolved expeditiously and satisfactorily, it could have implications in terms of the way in which businesses see the way they do business with China," he added.

Crean said Beijing needed Australia "as much as we need them" and he urged China to grant Hu access to lawyers and his family, and to resolve the case as soon as possible.

Hu, an Australian passport-holder, was detained on July 5 along with three Chinese colleagues during fraught iron ore negotiations.

His arrest followed Rio's snubbing of a proposed 19.5 billion US dollar investment from China's state-owned metals giant Chinalco, raising speculation the events were linked.

Chinese officials say Hu is suspected of using improper means to obtain commercial secrets about China's steel enterprises, including "taking bribes from individuals not employed by state organisations".

The case has raised diplomatic frictions between resource-rich Australia and China, the world's biggest iron ore consumer.