The Chinese-government owned Beijing Agricultural Investment Fund has teamed up with Shenzen-based Yuhu Agriculture Investment to establish a $3 billion fund to invest in Australian agriculture as Australia is inching closer to signing a free trade agreement (FTA) with China.
The fund, known as the Beijing Australia Agricultural Resource Co-operative Development Fund, will invest in Australian beef, dairy, lamb and aquaculture assets, with a focus on producing and exporting powdered infant milk formula to China, according to The Australian.
Australian Trade Minister Andrew Robb has welcomed the fund, saying it’s a strong signal from the country’s largest export market for agricultural produce.
“It’s a great signal that the Chinese investors are looking, in a fairly significant way, to position themselves in Australia, and they are doing it in a sensible way,” Mr Robb said.
Mr Robb told the ABC that negotiations on a FTA with China were advancing as expected and a deal could be finalised by the end of the year.
“These things are very complicated. There are, for instance, 11,500 individual tariff lines that have to be negotiated. A lot of that work is done. But as always, with any negotiation, the really big important issues invariably end up in the final stages of the negotiations,” Mr Robb said.
“So whilst we’ve been talking about it and have got a sense of where one another hopes to be, in many cases we haven’t finalised the very critical issues.”
The Beijing Australia Agricultural Resource Co-operative Development Fund was announced at a dairy investment forum hosted by Dairy Australia in Melbourne, which was also attended by several other Chinese investors looking to expand into Australia.
Ms Amy Qiao, of Esson International Investment Group, said Australia was popular with Chinese agricultural investors for its clean environment, and its reputation for quality produce. According to her, there is a huge and growing market for dairy products in China.
“For the dairy industry back in China, the market likes the product from Australia and it seems it cannot be replaced by other countries’ products. Traditionally, my fellow people, we don’t consume a lot of dairy products, but recently we all realise how important dairy is for people’s health,” she said.
“In my generation and my parents’ generation they did not like cheese at all, but my children, daily they consume that.”