MINING GROUP Rio Tinto yesterday unveiled measures, including 14,000 job cuts, to raise cash to pay off its debts and win back the market's confidence.

Rio's London-listed shares rose 20 per cent to £15.14 after it pledged to cut net debt by $10 billion (€7.68 billion) from $38.9 billion by the end of next year by slashing $5 billion from its capital expenditure budget, cutting 13 per cent off its workforce and putting mines up for sale.

About 8,500 of the jobs will come from contractors no longer needed to build new mines, but about 5,500 jobs will be cut from Rio's payroll, including staff at its London headquarters.

Rio chief executive Tom Albanese said the company was confident it could service its debt, most of which was taken on to pay for the takeover of Canadian aluminium producer Alcan last year.

Rio's shares have more than halved in the past two months as a slowdown in economic global growth, especially in China, has depressed metals prices. Investor confidence in Rio was shaken last month when BHP Billiton dropped its hostile $62 billion takeover bid, citing worries about the size of Rio's debt. "With these actions we will not need to consider a rights issue," said Mr Albanese.

He said Rio was "very comfortably within" the only covenant on its bank debt, that its net debt must be below 4.5 times the value of its earnings before interest, tax, debt and amortisation.

Instead of spending $9 billion on new mines and expanding operations next year, it will spend $4 billion. - ( Financial Timesservice)