China left out of iron ore price talks
Is the world just beginning to toughen up on tearaway China?
Her undervalued currency has already come in for heavy criticism from all quarters, but with no effect.
Her intransigence at the climate change conference last month in Copenhagen was roundly condemned but today perhaps a more specific and more intriguing development.
The companies involved in this year’s global iron ore pricing negotiations have decided to ‘sideline’ China.
China which accounts for buying up to 50 per cent of the world’s iron exports has been excluded from the talks which will fix this year’s benchmark price.
During last year’s negotiations in Beijing, Stern Hu, a Rio Tinto executive was arrested on suspicion of industrial espionage, he has been held without trial ever since.
This year the talks have been moved from China to Singapore. Two fingers to China is what it looks like.
According to today’s FT, the steelmakers Vale of Brazil, Rio Tinto itself, and BHP Bilton (the giant ore miners in Australia) have all got together to negotiate pricing with the Japanese.
One executive is quoted as saying that if the Chinese want an iron ore deal they can travel to Australia to talk about it.
But the Chinese, normally so successfully centrally planned, are themselves divided about how to organise any talks or pricing in this coming year.
We in the west so often whinge about the size and influence of these multinational mining corporations but in tightening the noose on iron ore supplies to China, with potentially catastrophic consequences for china’s rapid-fire development, are they doing the world a favour?
Certainly the case of Mr Hu represents a human right disgrace but it’s a case that still represents something of a norm in China.
Is it time then for more of the world to start holding China hostage over her human rights abuses, even if it hurts us in the short term?
For in the long term, if this norm is allowed to prevail, it could well come to haunt us in a form we might find much harder to combat.