Rio Tinto announces £3.2bn in cost cuts
Cost slashing exercise to be spread over two years
By CFOWorld.co.uk staff | CFO UK | Published 13:27, 29 November 12
Global mining giant Rio Tinto has announced US$5 billion (£3.2 billion) in cost cuts.
The cuts, which would be spread over two years, were announced on Thursday in wake of what the mining company described as stunted global demand and a dip in commodity prices.
In a statement Tom Albanese, chief executive of Rio Tinto, said, “We are taking further tough action to roll back the unsustainable cost increases of the past few years and are maintaining a relentless focus on improving productivity.”
Primary fear of most mining majors appears to be an economic slowdown in China as the macroeconomic picture the USA and Europe remains precarious. Other mining companies such as Anglo American and BHP Billiton have also announced cost cutting measures.
However, Albanese said Rio Tinto does expect growth in the Chinese over the coming months.
"I'm cautiously optimistic about the fact that we're beginning to see green shoots in China," he said.
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