Brace for tensions as China deal ends

AUSTRALIAN companies doing business with China are bracing themselves for tougher times after Foreign Minister Marise Payne tore up Victoria’s Belt and Road agreement with China.

“Australian business leaders have for some time been preparing for more challenging times ahead,” the national president of the Australia China Business Council, David Olsson, said on Thursday.

He said Australian companies that exported to China had already been moving to diversify while continuing to engage with Chinese trade partners.

The Chinese embassy in Canberra released a strongly worded statement on Wednesday saying the move would further damage the bilateral relationship.

While the move is being seen in the Australia-China business circles as yet another blow to political relations with potential retaliation ahead, the Council is publicly moving to play down the importance of the move, saying it was “not unexpected” in the light of recent changes.

“In the context of a rapidly changing geo-economic landscape, the decision to terminate the BRI memorandum of understanding and agreement is not unexpected, either here in Australia or indeed in Beijing,” Mr Olsson said.

“A domestic tussle over states’ rights is of little interest to Australian business (or to our ACBC members).

“They prefer to look beyond the politics of BRI and focus on the genuine commercial opportunities that will emerge from infrastructure investments across the Indo-Pacific region.”

Mr Olsson said Australian business was “agnostic” about the Belt and Road Initiative, which has largely been focused around infrastructure deals by China with third world countries.

“Their focus is on commercial opportunities,” he said of Australian companies doing business with China.

Mr Olsson said Australian companies were already “responding” to the prospect of challenges ahead in the China trading relationship.