Chinese state-owned Chinalco, one of the world’s largest aluminum producers, agreed to invest $19.5 billion in global miner Rio Tinto Group in the country’s biggest overseas investment. As part of the deal, Chinalco agreed to invest $12.3 billion in joint ventures in aluminum, copper and iron-ore mining. The deal will secure resource supplies for China and help cut Rio Tinto’s debt. Chinalco has also agreed to buy out U.S. aluminum group Alcoa’s interest in Rio Tinto for approximately $1 billion. Alcoa said it will seek to find new opportunities for cooperation with Chinalco in areas of alumina, aluminum, bauxite and fabricated products.

The agreement will give Rio Tinto greater access to China’s market, where demand for raw materials has soared. Rio Tinto is attempting to pay back $10 billion of its $38 billion debt by the end of 2009 by cutting 14,000 jobs worldwide, selling assets and cutting capital spending. In November 2008, rival miner BHP Billiton canceled its takeover of Rio Tinto because of the debt.