research / ACRI Facts

1. Australia’s agricultural exports to China reached $8.5 billion in 2014-15.[1] This compared with:

- $5.1 billion to the US

- $3.9 billion to Japan

- $3.3 billion to Indonesia

2. A Chinese government-owned company wanting to invest in Australia’s agricultural sector must obtain Foreign Investment Review Board (FIRB) approval, irrespective of the value of the proposed purchase.[2]

3. A Chinese privately-owned company wanting to buy Australian agricultural land must obtain FIRB approval if the value of the purchase is $15 million or more.[3] This threshold is cumulative.[4] It compares with a non-cumulative threshold of $1.09 billion threshold for investors from the US, New Zealand and Chile, and a non-cumulative $50 million threshold for those from Singapore and Thailand.

4. A Chinese privately-owned company wanting to buy an Australian agribusiness must obtain FIRB approval if the value of the purchase is $55 million or more.[5] This compares with a threshold of $1.09 billion threshold for investors from the US, New Zealand and Chile.

5. In 2013-14, the value of approved Chinese investment in the agriculture, forestry and fishing sector was $32 million.[6] This compares with:

- $602 million for Canada

- $600 million for Hong Kong, China

- $584 million for the US

6. Over the period 2009-10 to 2013-14, Chinese investment accounted for 2.9 percent of total approved foreign investment in the agriculture, forestry and fishing sector.[7] This compares with:

- 19.7 percent for Canada

- 19.6 percent for the US

- 7.6 percent for the UK[8]

7. In 2014, the food and agribusiness sector accounted for 1.5 percent of total Chinese investment in Australia. Since 2010 it has accounted for 2.9 percent.[9]

8. A 2015 poll of more than 1500 Australians[10] on preferences toward foreign investment in agriculture revealed that the public:

- prefer bigger dollar value investments to smaller ones

- are indifferent to whether the foreign company investing is government or privately-owned

- prefer investment from the UK than China, but the difference is small

 

Sources

[1]  Department of Agriculture and Water Resources, Agricultural commodities: December quarter 2015.

[2] Foreign Investment Review Board (FIRB).  http://firb.tspace.gov.au/files/2015/09/Australias_Foreign_Investment_Po...

[3] This rule was introduced in March, 2015. Source - FIRB

[4] “Cumulative” means that if a given Chinese company already owns agricultural land worth $15 million, any further purchases will require FIRB approval.

[5] This rule was introduced in December, 2015. Source - FIRB

[6] FIRB Annual Report 2013-14.

[7] FIRB Annual Report, various years.

[8] Hong Kong, China accounts for 4.9 percent.

[9]  KPMG and Sydney University, http://demystifyingchina.com.au/. This database records Chinese investment deals worth more than $5 million.

[10] Laurenceson, Burke and Wei (2015). http://press.anu.edu.au/wp-content/uploads/2015/12/analysis03.pdf