12 April 2014
Simon Benson
The Daily Telegraph
The Saturday Telegraph has learned that agreement has been reached to allow Chinese joint-venture projects for the large-scale capital projects required for the government’s northern Australia food bowl plan.
The Prime Minister yesterday revealed that rules around Chinese state-owned enterprises would likely be changed to treat them as private companies, potentially unlocking billions of dollars more in foreign capital to help fund Australia’s new infrastructure drive.
But just hours before being hosted at a private dinner with China’s President Xi Jinping in Beijing, Mr Abbott issued a warning that the media should not play to outdated fears about foreign investment.
“I don’t think we want to be getting a shock-horror headline that the ‘Chinese are coming’ or something like that,” he said before hosting a lunch for 1800 people at the start of Australia in China week in Shanghai.
“What we don’t want to be doing is playing to the gallery back home.
“We know that foreign investment can be contentious and we know that it is easy enough to whip up a storm about selling off the farm.
“Depending on the mood of the moment or a particular example some people can be furiously in favour of foreign investment … that same person, given a different time and different circumstances, can be quite ambivalent about it.”
He said yesterday that Australia hoped for much more Chinese investment “on the same basis we welcome investment from our other (free-trade agreement) partners such as the US.”
“We now appreciate that most Chinese state-owned enterprises have a highly commercial culture.
“They’re not the nationalised industries that we used to have in Australia. That’s why Australia has never rejected any investment application from a Chinese (state-owned enterprise) and recently approved a large investment in critical infrastructure.”
Government sources confirmed that trade minister Andrew Robb was negotiating investment vehicles that will allow Chinese firms to help build infrastructure to develop that plan.
The use of joint ventures is considered a way of allaying fears in some sections of the community about direct foreign ownership by the Chinese state-owned companies.
The treatment of Chinese state-owned enterprises has been a key hurdle in trying to conclude a free-trade agreement with China that would allow greater access to Chinese markets for Australian investment, agriculture, dairy and professional services.
China, despite investing an average of $60 billion a year in Australia, still ranks behind the US, UK and Japan in terms of total investment in Australia. Foreign state-owned enterprises currently have a zero threshold for being referred to the Foreign Investment Review Board.
Courtesy of The Australian