Whispers stoke unnecessary alarm
Rudd government offering Sri Lankan queue-jumpers and illegal immigrants on the Oceanic Viking everything but a set of steak knives, there has been plenty of drama to occupy the political stage. But there is another issue that has troubled the Rudd administration throughout its first two years: Chinese investment.
Understandably, the focus has been on investment in Australia’s resource sector.
The most dramatic development was the jailing of Rio Tinto’s Chinese iron ore negotiator Stern Hu and colleagues, which may have had its origins in difficulties surrounding the attempt by Chinalco to forge a strategic partnership with Rio Tinto: an attempt that caused Kevin Rudd and Wayne Swan a fair bit of angst over foreign investment policy.
Confusion over the policy, particularly as it applies to China, and the Rudd government’s less than successful attempts to clear it up have been a source of friction in relations between the two countries.
There has been fallout in terms of community attitudes to Chinese investment generally. The government’s changes to policies governing purchase of residential real estate by foreigners, which it prefers to describe as clearing away red tape, are also becoming an issue in some areas of Australia’s capital cities.
The Treasury’s Jim Murphy, responsible for, among other things, the Foreign Investment Review Board, cautiously observed in China earlier this month that there was a wide range of views in Australia on Chinese investment, some supportive, others less so. Two recent episodes illustrate the latter point.
The first came in an intervention at the closing session of The Australian and the Melbourne Institute’s Road to Recovery conference a fortnight ago. A participant explained that he had been in Broken Hill the previous week, “and the people there were viciously anti-Chinese”. They had said the three companies still mining in Broken Hill were 51 per cent owned in China. They also claimed, although they wouldn’t produce the letter, that everyone who owned a small business in the area had received a letter saying they must be prepared to consider a (Chinese) takeover.
