The value of Chinese investment in Australia collapsed last year after the application of stricter scrutiny by Canberra, in addition to the deterioration of bilateral relations and a decline in foreign investment globally due to the emerging Corona virus epidemic.
The British Financial Times newspaper reported - via its website - that the significant decrease in Chinese investments came with the direction of other members of the "Five Eyes" intelligence alliance, including the United States and Britain, to tighten control over foreign investment for reasons of national security.
And "Five Eyes", is an intelligence alliance that includes the United States, Britain, Canada, Australia and New Zealand, and was established under the British-American multilateral treaty.
New data shows that Chinese investment decreased by 61% year-on-year to 1 billion Australian dollars (780 million US dollars) in 2020, down from 2.6 billion Australian dollars recorded in 2019, while Chinese investment peaked in 2016 (the year of the signing of the trade agreement. Hurra between the two countries) 16.5 billion Australian dollars.
Chinese investment in 2020 was limited to only 3 sectors, namely real estate, mining and manufacturing, which is a big shift compared to previous years, in which investments extended to all sectors, according to the Chinese Investment Tracking Database managed by the Australian National University.
"The collapse in investment reflects the impact of the Corona pandemic, and the tightening of control over foreign financing by Canberra, especially from China," said Shiro Armstrong, Director of the East Asia Bureau of Economic Research at the Australian University, pointing out that global foreign direct investment declined 42% during the epidemic, While foreign investment in Australia decreased by 46%, according to data released by the United Nations.
"It is an issue worth noting, as Australia was the largest destination for Chinese investment in the world during the height of the commodity boom ... We received much more Chinese investment than from the United States, and that has collapsed," he added.
Relations between Australia and China deteriorated to a low level after Canberra called for an international investigation to investigate the origin of the Corona virus, and its adoption of strict laws against foreign interference and stricter scrutiny of foreign investment .. In March last year, Canberra introduced temporary changes to its investment system, and subjected all foreign investment. For scrutiny by the Foreign Investment Review Board, this led to lengthy delays in response, particularly to Chinese investors, according to bankers involved in the transactions.
The government was also forced to abandon two major deals, namely the A $ 600 million offer by China Minginho to acquire the Japanese-owned Lyon Dari and the China State Construction Engineering bid of A $ 300 million to acquire ProBild. , Which is a South African owned construction company, by direct refusal.
Geoff Raby, the former Australian ambassador to China, said that the Australian government had thus sent a clear message that Chinese investment is not welcome .. On its part, Beijing accused Australia of “arming” the concept of national security to obstruct Chinese investment, a claim denied by Canberra. Beijing's capital controls in 2017 to reduce foreign investment inflows from China.
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