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Approximately 68 countries have signed up to Chinese President Xi Jinping’s “One Belt, One Road” (BRI) project, which has left Aussie politicians divided.
The Chinese said the BRI’s “overall vision” was to build a “road of peace, prosperity, opening up, innovation and civilization” in collaboration with other countries. Over the next five years, China is expected to spend as much as $1 trillion on the project.
“I don’t think the (Australian) government has done a great deal of thinking about this,” Michael Clarke of Australian National University said.
Beijing first unveiled in BRI in 2013 and billions of dollars have already been earmarked for the many undertakings.
“But, I’ve heard from my contacts in government that there is a very definite divide between the security agencies who have strategic concerns and the departments of trade and agriculture, which are looking at BRI as a big economic opportunity for Australia,” Clarke added.
Over the past year, Chinese investors have been purchasing agricultural spaces in Australia. So far, to the tune of $1 billion – a major increase over last year's $300 million.
The investors are reportedly looking to produce goods to export back to middle-class Chinese, who demand Australian-produced fruits, meats, wine, dairy and minerals, on the mainland.
Property value has also increased in in Australian cities. Sydney is reported up by 98 percent and Melbourne by 84 percent, according to data, information, analytics and services provider CoreLogic. Last year, Chinese investment in Australian residential real estate market recorded its highest figure to date, according to Juwai.com.
Earlier this year, Australian heads of the immigration and defence departments told Malcolm Turnbull administration not to join the BRI and government have actively made moves to stem the movement of Chinese money into Australian assets.
Australia has lowered incentives for foreign real estate buyers. In 2017, real estate website Juwai reportedly observed an average Chinese property buying price of about $350,000 in Australia, roughly $40,000 lower than the previous year.
But, Credit Suisse expects the demand to remain on the high end.
Clarke said Australian politicians are torn between their commitment to the United States and the growing superpower, China. “The key issue is whether Australia can have its cake and eat it too when it comes to China."
China has already pledged more than $100 billion for BRI, earmarked for a series of bilateral projects – such as $46 billion for the China-Pakistan economic corridor and a $5.2-billion railway which will span Laos, Thailand, Malaysia and Singapore.
The plan will involve more than 60 countries and 4.4 billion people across Asia, Europe, Africa and the Middle East, tallying up to 40 percent of the world's GDP.
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During the recent opening of the national congress, Xi outlined a timeframe for China to become a “global leader.”
In the three-and-a-half hour speech, Xi urged his Communist Party to take a more hands-on approach with regards to civil and economic development.
Xi added that the party would put China on the road to becoming a “great modern socialist country” by the mid-century.
“The Chinese nation… has stood up, grown rich, and become strong — and it now embraces the brilliant prospects of rejuvenation… It will be an era that sees China moving closer to center stage and making greater contributions to mankind,” he told the national congress.
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