Rio¡¯s Walsh Has Hope of ¡®V-Shape¡¯ Recovery in China (Update1)

Rio Tinto Group, the world¡¯s third- largest mining company, is hopeful of a ¡°v-shape¡± recovery in China, its head of iron ore Sam Walsh said.

¡°What is unshakeable is our belief that China and India and the other emerging economies will be the key engines of any return to world growth and commodity demand growth,¡± Walsh said at a resources industry presentation in Canberra today.

China¡¯s economy is operating better than expected, according to the nation¡¯s State Council. The ¡°worst is over¡± in demand for raw materials and prices for base metals may have bottomed, Goldman Sachs JBWere Pty said in a report yesterday.

¡°We are ready to expand again,¡± when there is a sustained recovery in metals demand, Walsh said. ¡°Signs of improvement are present in recent data from China and such improvements continue the traditional recovery in exports and housing.¡±

Rio shares fell 0.1 percent to A$64 on the Australian stock exchange at 10:07 a.m. in Sydney.

London-based Rio said this month it remains committed to a proposed $19.5 billion investment deal with Aluminum Corp. of China. The company has agreed to sell $7.2 billion of convertible bonds and stakes in projects worth $12.3 billion to Chinalco.

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