China’s mega-wealthy are a secretive bunch, so it came as a surprise when one of the country’s richest men fell under the spotlight during the trial of the Rio Four.
Steel magnate Du Shuanghua (杜雙華), head of Rizhao Steel, was named during the proceedings at a Shanghai court where Rio Tinto employees faced hours of questioning.
Du, China’s second-wealthiest man in 2008 according to the Hurun Institute’s rich list, allegedly gave US$9 million to Wang Yong (王勇), one of the Rio executives, the court was told. Wang’s lawyer denied wrongdoing and said the money was a loan to buy shares in companies listed on the Hong Kong Stock Exchange.
The naming of Du by one of the accused executives added an extra dimension to a trial that is politically and economically sensitive.
Zhang Peihong (張培鴻), Wang’s lawyer, said his client’s case turned on allegations he accepted a US$9 million bribe from Du, who owns a big stake in Rizhao, one of the country’s largest steel makers, or whether the money was paid for other purposes as he said.
Steel companies have pushed in recent years to secure supply contracts with big miners, such as Rio, as the contract price has often been lower than the global spot price for iron ore.
The Financial Times said Du has also been involved in a battle to retain control of Rizhao, after coming under pressure to sell a majority stake in his company to a state-owned rival.
In an interview in a Chinese magazine, Du said his objectives were not limited to having the largest steel enterprise in Shandong Province. He wants to expand into port construction and develop metals technology.
Former premier Deng Xiaoping (鄧小平) might have said that getting rich was glorious three decades ago, but China’s millionaires have every reason to shun publicity. When a Forbes magazine survey of China’s richest appeared in 1999, observers called it the “death list” after a tax crackdown targeted many of those mentioned, with scores jailed and several executed.
Du grew up in Hebei Province. His father headed a department at a steel plant and he worked there, leaving at 22 to set up his own factory making steel tubes.
“He could not afford to hire a crane ... He moved bricks himself and ate steamed bread with workers on the ground,” Du Qinghe, the Chinese Communist Party secretary of his hometown, told a Chinese newspaper.
Business boomed and more plants followed — until a steel shortage in 2001. Du spotted his chance and moved into the industry, catapulting him into the big league. It reportedly took him less than six months to build his first mill and start production.
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