China increases its stake in Australian land

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Chinese investors have added another 50,000 hectares to their Australian property portfolio, taking the total area of property under Chinese control to more than 9.1 million hectares amid growing concerns over foreign interference and national security.

China is now the second largest investor in Australian land and is within a million hectares of the top landholder, the United Kingdom, as Canberra moves to tighten controls over foreign investors.

The Bahamas has rocketed up the standings after a company or individual based in the tax haven finalised the mysterious purchase of more than 2 million Australian hectares, almost twice the size of the Caribbean island itself.

Treasurer Josh Frydenberg said while foreign investment was an important contributor to growth, productivity and jobs in agricultural communities, “it is important to ensure that foreign investment is not contrary to the national interest”.

This year, the threshold for buyers to seek regulatory approval for purchases was slashed from $252 million to $15 million. This came on top of a string of decisions that shut out foreign buyers from large properties and other  infrastructure assets.

As part of the reforms, sellers are now forced to advertise holdings to locals for 30 days before foreigners can get a look in.

The changes also mean foreign buyers can be blocked by the Treasurer for purchases larger than $15 million – frustrating sellers who believe foreigners have the highest bids and should be entitled to purchase property.

Labor has indicated it will ramp up Thursday’s report from the Australian Tax Office by identifying buyers of land, value and locations if elected next year.

“The register should set out for everyone to see not just the percentage of land owned by overseas companies but who has purchased it, where and how much they paid for it,” opposition trade spokesman Jason Clare said in September.

Overall, foreign ownership of Australian agricultural land fell slightly from 13.6 per cent to 13.4 per cent in 2017-18.  In Victoria and NSW it ranges from 2-7.5 per cent, depending on the region.

The majority, located in Western Australia and the Northern Territory is used for livestock purposes, but concerns remain about access to water and other infrastructure if land is wholly owned by foreign interests.

Those concerns prompted then treasurer, Prime Minister Scott Morrison, to reject a bid from a majority Chinese-owned consortium for cattle empire S. Kidman & Co and stop the lease of Ausgrid NSW electricity assets to a Chinese company in 2016.

An investigation ordered by former prime minster Malcolm Turnbull in May reportedly found China had engaged in “brazen and aggressive interference” for the past decade.

Mr Turnbull later banned Chinese telco Huawei from Australia’s 5G network in his last act as prime minister.

By Eryk Bagshaw
SMH

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