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Chinese corporate leaders say it's good for b -

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Chinese corporate leaders say it's good for business

The World Today - Friday, 27 March , 2009 12:27:00

Reporter: Sue Lannin

TANYA NOLAN: The debate over the Defence Minister's associates has again raised concern about the
influence of Chinese interests in Australia.

The Foreign Investment Review Board is poring over applications by Chinese state owned companies to
increase their stakes in the nation's mining assets.

At the top of the list is Beijing-backed Chinalco's plan to double its holdings in Rio Tinto. That
would see Chinalco holding a stake in key operations like the giant Hammersley iron ore operation
in Western Australia.

Chinese corporate leaders are playing down concerns over their strong interest in Australian assets
and say it's all about good business opportunities in a globalised world.

Finance reporter Sue Lannin met senior Chinese executives who have been visiting Australia to study
corporate culture.

(Sound of somebody speaking Mandarin)

SUE LANNIN: The talk was about partnership for the Chinese business leaders who were in Australia
this week as guests of the University of Technology, Sydney.

(Laughter and applause)

Jiang Xinghong is the deputy chief executive of Shougang, China's fourth largest steelmaker. He
says Australians should not be concerned about Chinese investment.

JIANG XINGHONG (translated): We always obey all the regulations and laws of China when we do
business in China. When we do business in Australia, we also obey all the regulations and laws.

SUE LANNIN: Shougang holds a 40 per cent stake in Mt Gibson Iron, an iron ore miner in Western
Australia. The global financial crisis hit Mt Gibson hard. In November the cash-strapped company
went to its Chinese investors to ask for more money.

Mr Jiang says Shougang is happy with the investment.

JIANG XINGHONG (translated): The cooperation is very successful. But the next stage will require
more negotiation to perfect the partnership and to allow us to cooperate more closely. It's not
easy to predict right now but we believe it is very successful.

SUE LANNIN: Major Chinese investment in Australia goes back to 1987 when Sinosteel and Rio Tinto
teamed up to develop the Channar iron ore mine in Western Australia.

Many Australian miners depend heavily on their international partners so they can expand.

Mr Jiang says Shougang is looking for more opportunities.

JIANG XINGHONG (translated): We have several partnerships with Australian companies. We have learnt
a lot, we have got back a lot back - everybody's happy.

During the financial crisis, it is very important to cooperate.

We're a very large company. We think in terms of human resources, technology and mining. There are
a lot of investment opportunities.

SUE LANNIN: Another company that's not ruling out expansion is Huating Coal Group, a giant coal
company based in north-western China.

Zhu Tongyin is the chief executive.

ZHU TONGYIN (translated): We're a resources company and we have various businesses. Our supplies in
China will last for a hundred years, and we produce 20-million tonnes of coal every year.

We don't have any plans for an international merger and acquisition at the moment, but obviously in
the future we may consider it.

SUE LANNIN: Chinese government companies are closely controlled by Beijing. They get finance from
state-run banks. Executives must get permission to travel overseas, as they compete to be noticed
on the foreign investment stage.

Prime Minister Kevin Rudd, or Lu Kewen as he is known in Mandarin, is well liked by China.

Jing Dechun from the China National Petroleum Corporation, one of the world's biggest oil
companies, says it's all about globalisation.

JING DECHUN (translated): I understand your Prime Minister is arguing for a more important role for
China in the global economic system and that would be good for everybody.

SUE LANNIN: And with China the biggest holder of US government debt, Beijing's role in the world is
set to get bigger.

TANYA NOLAN: That's finance reporter Sue Lannin.