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Managing the controversies over Chinese foreign investment – Lessons from Australia

Wilson, J.D. (2015) Managing the controversies over Chinese foreign investment – Lessons from Australia. China's World, 1 (1). pp. 9-19.


The China-Australia investment relationship is rapidly expanding. Driven by the need to secure access to natural resources, Chinese firms have made major investments in the Australian mining industry in recent years, bringing significant economic benefits for both countries. However, and similar to the experience of other countries hosting Chinese investment, this relationship has proven highly politically contentious. Anxieties have emerged about the behaviour of Chinese state-owned enterprises, key stakeholder groups in Australia have become divided on the appropriate regulatory response to surging Chinese investment, while the Chinese government has alleged Australian investment regulations discriminate against its firms. This article examines how political controversies in the China-Australia investment relationship have been managed, to explore what lessons this experience may offer for other countries where similar controversies have emerged. It reviews their emerging investment ties and the policy environments supporting than, considers the political disputes that have emerged surrounding Chinese investment in Australia, and explores how the Australian government has used 'behavioural conditionality' as a political management strategy. It concludes by arguing the Australian approach may offer a useful model for how other governments can balance the economic benefits and political risks associated with developing investment ties to China.

Item Type: Non-refereed Article
Publisher: Huawen Institute
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