Stern Hu

Stern Hu
Born	Hu Shitai 1963 Tianjin, China
Residence	Shanghai, China
Nationality	Australia
Other names	胡士泰
Alma mater	Peking University
Employer	formerly Rio Tinto
Known for	Australian iron ore enterprise businessman jailed for stealing commercial secrets and receiving bribes
Title	Chief Representative in Shanghai, Hamersley Iron Chinese Regional Manager
Spouse(s)	Julie Hu

Stern Hu (Chinese: 胡士泰; pinyin: Hú Shìtài; born 1963, in Tianjin) is an Australian businessman of Chinese origin. He was formerly an executive of Rio Tinto mining group in Shanghai, China prior to his trial.^[1] He graduated from Peking University before obtaining Australian citizenship in 1994.^[2]

Arrest in China

Hu was detained on 5 July 2009 with three other Chinese colleagues by the Chinese government.^[3] After pleading guilty, on 29 March 2010 he was sentenced to 10 years' jail by a Chinese court for stealing commercial secrets and receiving bribes.^[4]

The issue has made a heavy impact in both China and Australia, making front-page appearances in most major media across the two nations.^[5] Information found stored on Hu’s personal laptop, seized by investigators, allegedly contains confidential business information of several dozen major business partners of Rio Tinto, including storage levels and sales plans, deemed much too specific and precise to have been acquired through legal means,^[6] but rather through bribery,^[7] where access to such information is limited even to employees within these companies. Hu is thus accused of having obtained such information through bribery and other illegal means, for massive corporate and personal benefits.^[6]

The Australian government called in the Chinese Ambassador to Australia to discuss the situation, with Prime Minister Kevin Rudd, a former diplomat to China, under pressure to intervene on the issue on a higher profile.^[8] Rudd refused to intervene on a personal level, and criticised the media and the opposition party for adding political bias to the issue. Nevertheless, Australian authorities were granted access to the arrested businessman. After the visit, Foreign Minister Stephen Smith declared that Hu is in good health.

His arrest came a month after Rio Tinto rejected Chinese aluminium firm Chinalco's bid to double its stake in the miner to 18 per cent. However, Chinalco has denied any linkages between the two events.^[9]

Trial

Following the trial, Stern Hu was sentenced to 10 years jail.^[10] Hu and other convicted executives have also had their employment terminated by Rio Tinto Ltd.^[1] It is reported that the motive behind the terminations is in regards to a breach of conduct, with Rio Tinto accepting the evidence provided showing instances of bribery. Rio Tinto also states that the trial will not affect business ties, according to its chief executive.^[11]

Official PRC government reactions

Foreign affair spokesperson Qin Gang

On 15 July 2009 Chinese official foreign affair spokesperson Qin Gang, when Qin Gang was referring to Australia's Prime Minister Kevin Rudd's reaction towards the alleged Spy case, in which Kevin Rudd warned the Chinese government of possible economic consequences:

I've noticed that in Australia recently some people have been making noise about this case....This is an interference in China's judicial sovereignty.

It cannot change the objective facts nor can it have influence on the relevant Chinese authorities which are dealing with the case according to our law

We're firmly opposed to anyone deliberately stirring up this matter....This is not in accordance with the interests of the Australian side.^[12]

NAPSS (Jiangsu Province) official Jiang Ruqin

Jiang Ruqin(蒋汝勤)(chief of the Secret Protection Bureau of Huai'an city, Jiangsu Province) ran an essay on China Secrecy On-Line, a Chinese-language Web site affiliated with the National Administration for Protection of State Secrets, or NAPSS,over the weekend (8 August 2008) that said Rio employees had engaged in deceit over six years that had led to Chinese steel mills overpaying for iron ore by CNY700 billion, or US$102 billion.^[13] But other NAPSS official stated:

NAPSS didn't authorize anyone to release comments (on the Rio case)...We can't say his essay represents views of the administration...It is his own essay...^[14]

Jiang Ruqin wrote:

The large amount of intelligence and data from our country's steel sector found on Rio Tinto's computers and the massive damage to our national economic security and interests are plainly obvious...^[15][16]

Rio Tinto's Media Release

Shanghai employees - Update 2 11 August 2009

Sam Walsh chief executive iron ore acknowledged the second visit to detained Rio Tinto employee, Stern Hu, by Australian Consular officials.

Mr Walsh said, "We are pleased to hear that Stern appeared well and that he raised no welfare or medical concerns.

Mr Walsh said the company remained surprised and concerned over the detention of its four employees, and said the company had still not been informed of any charges against them.

He said, "We are still not aware of any evidence that would support their detention. Rio Tinto is committed to high standards in business integrity and takes its ethical responsibilities very seriously."

"We continue to be concerned for the health and welfare of our three other employees detained at the same time as Stern Hu," he said.

Mr Walsh thanked the Australian Government for the attention it is giving to this case and to Stern Hu's welfare.

Australian media reactions

Australian Broadcasting Corporation

On 14 July 2009 Leigh Sales of the ABC, during the popular TV program Lateline interviewed two Australia's leading international-relations expert- Professor Hugh White, of the Australian National University, and Dr.Paul Monk, of Austhink Consulting, in which Hugh White said:

Well, I think we are facing something very important here - that is that we are starting to work in a world in which very big and powerful states are governed in a way very different from ourselves. We have been a very lucky country. For a long time we have lived in a world where the rules are set by our big and powerful friends. We are now moving into a world in which, Australia in particular and for the world in general, very powerful countries like China, immensely influential in the international system and the global economy, are governed in very different ways.

Paul Monk:

It's not unusual for the simple reason that the Chinese Government is one of the most secretive in the world. There is no free press over there. Anybody who tries to get this kind of information can be charged with stealing state secrets, just as Stern Hu has been. This is the kind of thing I'm pointing to. It's - this is not a Chinese way of governing, let me emphasise. This is an arbitrary party-rule problem that we are talking about.

It's odd, let me say in the context of the bilateral relationship, that the Chinese Government is not choosing to talk candidly with the Australian Government about this. If it has a problem with what Mr Hu did, and values the relationship, I would have expected that they'd go to our officials and say, ‘Look, we are concerned about this, this could be a problem’. That they are not doing that reeks of bad faith. ^[17]

The Australian

On 11 July 2009 Jennifer Hewett, National affairs correspondent of The Australian reported:

This is an arrow shot into the heart of Australia's most vital trading relationship. It rips open the usual diplomatic cover of a polite and mutually beneficial political and economic relationship between the two countries.^[18]

See also

• Rio Tinto espionage case
• Xue Feng

References

External links

• China iron and steel Association
• Experts discuss China's rise, an Australian ABC Lateline TV program (video)