Australia Divided Over Chinese Farming Proposal

A joint proposal to allow investment by Chinese companies in northern Australian farmland has sparked a partisan war of words between two government officials and prompted a nationwide debate about foreign land ownership, food security and Australia’s future. From AFP:

Canberra and Beijing launched the study last May and its findings were due to be released within weeks, according to the newspaper.

Australian Trade Minister Craig Emerson stressed that it would not involve “selling up” valuable national resources, nor “importing overseas labour and dedicating the production to Chinese consumption”.

“It is designed to lift Australian food production for world markets,” Emerson said from Beijing.

Chinese investment is a sensitive issue in Australia, with telecom 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.

AFP adds that Chinese firms wouldn’t be the first to buy Australian farmland for food security, with a Qatari and a Singaporean company already among those that have a presence Down Under. But as Lauren Quaintance reports in the Sydney Morning Herald, one opposition senator claims that a Chinese investment has different implications and has railed against the proposal:

The Nationals Senator, Barnaby Joyce, who has pushed for tougher restrictions on foreign ownership of land – a move seen as breaking ranks with the Liberals – said it was a worry for urban as well as regional Australians. While the move by the Chinese was “astute”, Senator Joyce said it exposed the lack of planning for our own food security since Australia was now a net importer of food – and the resulting inflation had an impact on food prices. “It’s not that you’ll run out of food; it’s the form of food that you’ll be able to buy, and that is happening right now. How often do you see people now who in the past bought the roast, now by mince? Why? Because they can’t afford the roast, but that was once a staple.”

Selling Australian land to a foreign state-owned enterprise has troubling implications, according to Joyce. “Therefore it is held by an organ of the government, and governments , especially strong ones like the Chinese, don’t go broke. Therefore they can hold it in perpetuity”.

Joyce denied his views were xenophobic. “Look at any other country and see what their controls of [foreign] investment are like and then compare it to ours and you’ll see you can’t buy [land] in China, you can’t buy it in Japan, you can’t buy it in South Korea, you’re struggling to buy in the United States and there are vastly greater controls with buying it in New Zealand.”

Emerson fired back late this week, saying in an interview with ABC that Joyce and other members of Australia’s coalition opposition wanted to drag the country “back to the 1950s” and denying allegations that he supports the proposal because a former colleague is reported to be representing one of the Chinese firms. In an opinion piece in The Australian this morning, Emerson argued that shunning foreign investment is short sighted and irresponsible:

But limiting agricultural expansion to that which could be funded from domestic savings would be to squander an opportunity for regional revival and development. Africa and South America are preparing to take advantage of Asia’s rising middle classes in the Asian century. Yet in the interests of harvesting votes, a Coalition government would say no, Joyce likening state-owned investment to foreigners moving into your house.

The Coalition argues that state-owned enterprises are instruments of foreign governments and, in serving the interests of their masters, must be against Australia’s national interest.

Underlying this proposition is a belief that foreign investment is a zero-sum game; if a foreign investor gains, Australia must lose. It fails to comprehend that the purpose of investment is to yield net benefits that can be shared between the parties; that investment is a vehicle for wealth creation.

Also in The Australian’s today, Asia-Pacific Editor Rowan Callick writes that China and Australia’s diplomatic relationship approaches its 40th anniversary having come a long way but still underachieving:

But realists wonder whether the relationship can become as close as many individuals on both sides would hope, unless or until the ruling communist party sheds its jealousy that requires its ultimate control of every significant institution in China, and agrees to share its power — perhaps starting with the courts — or eventually, less likely, fades away.

Here we enter forbidding terrain, down which no one in Australian official life, and few even in our universities or in business, venture to go, so dependent have they become on Chinese incomes. Even mentioning the party tends to be deemed impolite.

But at the heart of the potential for the relationship lies the question: can Australia relate to the China beyond the party, or must every significant aspect of the relationship, where organisations are involved, be directed by the party? Otherwise politics will continue to impose limitations. Our polities are so different that they cannot be at ease with each other on matters that stretch far beyond those of obvious immediate mutual interest, central though these are: trade, investment, military exchanges.