Australia is seeking billions of dollars in Chinese investment to develop vast tracts of prized farming land in the country’s sprawling north in a joint bid to boost food security for the Asian giant’s 1.3 billion citizens.
In a move that could reshape the global food market, the two nations have launched a study into the proposal, which would see Chinese companies invest directly in farms focused mainly on beef, sheep, sugar and dairy on undeveloped land across three states in northern Australia. The findings of the study, which has examined the policy changes needed for the investment by Chinese agricultural interests, are due to be released within weeks.
Some sites under consideration are the Ord River in Western Australia and the Atherton Tableland in Queensland.
Despite concerns from the Australian Greens and members of the opposition coalition parties, who say they are worried the country’s agricultural land might be sold to Chinese companies, Craig Emerson, the Australian Trade Minister, stressed there was no proposal for “buying up the farm, importing overseas labour and dedicating the production to Chinese consumption”.
“It is designed to lift Australian food production for world markets,” Dr Emerson told the Australian Financial Review during a trip to Beijing.
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Chinese investment is a sensitive issue in Australia, with telecoms company Huawei banned for security reasons from bidding on the nation’s broadband rollout earlier this year and several mining takeovers failing on similar grounds.
Rural conservative politicians have warned against selling valuable agricultural land to foreign investors, particularly China, which is Australia’s top trading partner due to bullish resources exports.
The Nationals senator Barnaby Joyce, who has pushed for tougher restrictions on foreign-owned land in Australia, warned the move could prove to be a worry for both urban and regional Australians
“I don’t blame the Chinese for being prudent and planning ahead for their own food security, but if this is in their best interests to buy our farms, then it can’t be in ours as well,” Senator Joyce said.
“We create all sorts of problems for ourselves when we get excessive foreign investment in economic chokepoints that control large sections of production.”
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A government study into ownership of Australian agriculture published in January found that foreign firms controlled about half of the nation’s key food industries but offshore investors owned just 11 per cent of its farmland.
The study was commissioned to soothe community concern about foreign ownership of farming and Canberra said at the time that the findings should ease “misinformation and hysteria” about an “invasion” of foreign investors.
Foreign firms account for about half of the nation’s wheat, dairy, sugar and red meat sectors, following a flurry of takeovers in recent years, but foreign ownership of land, at 11 per cent, is little changed from 30 years ago.
Qatar’s Hassad Food and Singapore’s Olam International are among firms that have bought up Australian farmland to boost their own national food security.
While Dr Emerson has urged Australians against letting racism creep into the debate, vocal opponent Bill Heffernan, a senator from the conservative Liberal party, said it was important to be passionate about Australia’s future and warned the plan was an attack on its sovereignty.
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“This is not xenophobic, there are clear loopholes in the foreign takeovers Act and in the taxation Act and this is a decline in the meaning of sovereignty,” Mr Heffernan told ABC radio.
Greens Senator Christine Milne said she was “very concerned” by the plan, particularly any involvement by foreign state-owned companies.
“What guarantees can we have that this is going to be in the context of trade as opposed to outsourcing and direct production of other countries’ food supplies?” she said.