Comment: Melbourne Mining Club makes mark in China

The Melbourne Mining Club’s first foray into China was a resounding success writes Rowan Callick.

One of the most lively institutions in the Australian business world began life in 2001, is run by volunteers, gives away any money it makes – and is now making its mark in China too.

The Melbourne Mining Club holds a speaker meeting in Melbourne’s impressive town hall – built, appropriately, by money from the 19th century Gold Rush – about every two months. Often the massive hall is packed, with about 700 people from the city’s mining, finance, legal and accounting businesses.

The speakers include the most powerful figures in the global resource industry. It is resolutely outward-looking – inevitably given the sector’s international dimensions.

The club, which gives spare money it raises to the cause of educating young Australians about the mining sector, on which the nation’s prosperity continues to depend, began in the last few years to stage its first meetings overseas, in London – at the famous Lords cricket ground.
In mid August, it extended its franchise to China, whose appetite for Australia’s commodities has become crucial for the economies of both countries.

It held a dinner meeting at the Peninsula Hotel on Shanghai’s famous Bund, its street alongside the Huangpu River that is lined with some of the world’s finest art deco buildings, now exquisitely restored.

The speakers were appropriately Zhou Zhongshu, the energetic and polished president of China Minmetals, a longtime buyer of Australian commodities but last year also the buyer of an Australian mining house that it has re-badged as MMG.

He told my colleague Michael Sainsbury – the China correspondent of The Australian – and I shortly before the Mining Club dinner, that he aimed to use MMG, whose chief executive is an Australian, Andrew Michelmore, as his company’s vehicle to build a global mining house that will help guarantee vital resource supplies for China.

The other speaker at the dinner was Tom Albanese, the chief executive of Rio Tinto, who took the company’s helm in March 2006 and has guided it since then through extraordinary days – during which China has been a vital continuing thread.

There were almost 500 people at this inaugural Chinese session of the Melbourne Mining Club. At first, there was some puzzlement in Shanghai. But as word of mouth spread about the clout of the speakers and of the people involved, the organizers, led by Shanghai based Peter Arkell, could in the end have sold several hundred more tickets.

More meetings in China are almost certain to follow, such is the interest.

The club’s triumph was followed the next day by a seminar on the resources industry run by ANZ Bank, at the Australian pavilion at Expo – which had then already been viewed by 5 million visitors, with the 7 million target looking highly achievable.

Queues were stretching, largely uncomplaining despite the 38 degrees heat, for 4-5 hours to get into some pavilions. Special invitations to avoid the queues are highly coveted, and those attending the ANZ seminar were all beneficiaries.

The speakers included Clinton Dines, who was BHP-Billiton’s hugely respected head in China for more than 15 years, Mitch Hooke, the chief executive of the Minerals Council of Australia and recently a very public champion of the sector, Hu Weiping, the director-general for oil and gas at the new National Energy Administration – the figure most responsible for landing China’s first LNG contract with Australia, for gas from the North West Shelf – and again, Tom Albanese.

The main theme was sustainability, which leadership in the industry has transformed from a painful duty into an asset. Translated into today’s Chinese favourite clichés, it is about win-win, win for the companies and win for the environments in which they operate, both social and physical. It is also about building a harmonious world.

Other corporate sectors in Australia might usefully look at how the resources and energy industries have built such indispensable and profitable links with China.

The Australian Institute of Company Directors – which represents a broad swathe of the economy – is about to expose its members, again, to the Chinese scene, by holdings its annual meeting in Beijing next May.

The AICD held its first such meeting overseas, in Shanghai three years ago. That was obviously enough of a success to attract the institute back to China.

The Melbourne Mining Club dinner and the ANZ seminar attracted me back to China, and in a visit to both Shanghai and Beijing – where I lived for three years until the end of 2008 – I discovered that the global downturn had undermined the hard work of a few friends while I was away.

The international corporates had not spared China as they desperately cut costs around the world, even though in many cases their operations there continued to turn handy profits. And some of the services provided by inventive, often young Australian businesspeople there were among the casualties. Training, government relations, media links, tend to be cut first.
Most of my business friends in China are still in place, doing well, doing good, and enjoying life. This year everything has largely picked up, except in the confusing – and probably bubble-prone – real estate world, lessons have been learned, and adaptations made.
But spare a thought for those who didn’t make it. Newcomers are already taking their place, working below the radar, building some of the most interesting and innovative bridges between China and Australia.

* Rowan Callick is the Asia-Pacific editor of The Australian

 

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