China’s unprecedented Australian resources grab
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Forget about the torch relay, the biggest issue Australia has with China right now is the Communist country’s extraordinary land grab for our already largely foreign owned resources dowry. The Australian’s national affairs correspondent Jennifer Hewett might be costing News Ltd more than $200,000 a year, but she’s been worth that fat wage in recent days with her ground-breaking coverage on the Foreign Investment Review Board’s push-back against Chinese Government raids on more Australian resource stocks. The Australian was right to splash with the story on ANZAC Day but Hewett’s coverage has since surprisingly been relegated to the business pages. As a foreign-controlled company with continuing Chinese aspirations, News Corp has never unleashed its media might on the world’s biggest totalitarian regime, so don’t hold your breath for The Daily Telegraph to splash with “Reds under every bed”, even though the current circumstances do warrant some rigorous public debate. Let’s be clear about what we are facing here: the Chinese Government has launched a co-ordinated strategy to buy up as much of Australia’s strategic resources as possible. The following extraordinary shopping list is BEFORE the revelation that another dozen Chinese applications are currently before the FIRB:
When you add all this up, Chinese Government backed companies have signed deals to spend more than $20 billion on companies with a majority of their assets in Australia and in the process have bought the rights to spend another $15 billion-plus directly developing additional projects. Add in the wave of applications that FIRB is stalling, the stand-off over iron ore contracts, the rejection of spot price shipments and BHP’s takeover bid for Rio Tinto and our Mandarin speaking prime minister finds himself in a very tough spot. How about a policy of no more Chinese takeovers unless Australian investors can do likewise in China? Check out the full list of foreign government investments in Australia and listen to yesterday’s discussion with Lindy Burns on 774 ABC Melbourne. |
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7 Comments
Good point Steve M about Singapore Inc/Singtel/Optus here. AFR glossy last week had a chapter and verse on their banking secrecy law for money laundering gazumping of even Swiss tax avoiding accounts. Very handy for Burma gangster/drug running regime Singapore is riven with moral hypocrisy for all the dirty money they launder for drug lords for Burma while hanging drug runners. Notice Burma in turn is propped up by China Inc for resources especially. Secondly Martin Ferguson is either in denial or naive or dishonest about China investment subject to market forces (Insiders last Sunday) like any other investor. Sounded like lip service to national interest and boiled frog syndrome. We can afford to take embassy defactor Chen Yonglin ( http://en.wikipedia.org/wiki/Chen_Yonglin ) on face value about the predatory and cruel tendencies of China Inc. When Burma and North Korea and China itself have free press then we might talk about an honest open market system.
All that dirty Chinese money. I’d prefer they spent it elsewhere and let Australia stagnate in its own limited pool of financial resources. And that iron ore is better off left in the ground where it can’t create too much employment and wealth among the labouring classes.
On the flip side, will a larger Chinese investment in Australia give Australian companies more barganing chips when being ridden roughshod over by their business “partners” in Chinese joint-ventures. And if so would our Governement have the guts to support us? Just a thought.
Yeah, stop trading with China until they have a democracy like ours, can all speak fluent English and play cricket.
I t would be very easy to label opposition to any Chinese takeovers, or of major investments in Australian companies as a racist reaction;after all much of Australian assets are already controlled by foreign companies be they US ,British , or wherever. But allowing Chinese government controlled companies into this country must be viewed with suspicion.Being government controlled their allegiance is to the intersts of Chinese government primarily and not to the wellbeing of the shareholders or Australia. I might add that my view on this also applies to other foreign governments controlling Australian assets. Singapore for example comes readily to mind.
With the ownership or control of strategic companies foreign governments are in a position to apply pressure on Australian government policy; surely something we could do without.
It’s worth remembering that FIRB refused Shell’s attempted takeover of Woodside for these sort of reasons.
There is also significant Chinese investment in junior miner Compass Resources, which is re-developing the copper, nickel and uranium deposits at Rum Jungle in the Northern Territory.
Disclosure: I own a few CMR shares.
What percentage of Middle East oil fields have been sold to the Chinese? Do the
Saudis permit foreign ownership?
Patrick