China arrests Aussie mining boss for spying

A Rio Tinto mining executive has been detained in China on suspicion of spying, causing a major diplomatic dispute between Australia and its second-largest trading partner.

Australia faces a major dispute with its second biggest trading partner after a Rio Tinto mining executive was detained in China on suspicion of spying.

Chinese authorities have detained Australian Stern Hu, believed to be Rio Tinto's general manager of iron ore in China, together with three of his Chinese colleagues from the Anglo-Australian miner.

Australian consular officials are still seeking access to Mr Hu, and have given China until Saturday to permit a meeting under a consular agreement.

Foreign Minister Stephen Smith said Australian officials were advised on Wednesday afternoon that Mr Hu was being detained on the suspicion of espionage and stealing state secrets.

The long-term Rio Tinto employee was detained on Sunday by officials from China's Ministry of State Security.

Mr Smith said Canberra was perplexed by the allegations.

"Because we're perplexed by the reason for his detention ... we're asking for additional information to the basis of his detention," he told ABC TV.

A spokesman for Rio Tinto said the company was surprised at the suggestions of spying and was unaware of any evidence to support them.

"We will continue to work to support our employees and their families," the spokesman said.

The arrest comes at a sensitive times in the relationship after Rio Tinto pulled the pin on a bid by China's state-owned Chinalco to take a $US19.5 billion ($A24.7 billion) stake in Rio Tinto.

It also coincides with unconfirmed reports that Chinese steel mills have finally agreed to annual iron ore prices - but for six months rather than a year.

Source AAP

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