Staff members talk as they prepare for a seminar on the bilateral cooperation of Australia China in resources and infrastructure in Western Australia, in Beijing, 23 July 2009. REUTERS / Jason Lee
Australia on Wednesday canceled two Victoria State deals with China over Beijing’s flagship Belt and Road Initiative, asking the Chinese embassy in Canberra to warn that already strained bilateral ties are deteriorating.
Under a new process in Australia, the Secretary of State for Foreign Affairs, Marise Payne, is empowered to reach transactions with other countries through the countries and universities of the country.
Payne said she had decided to cancel four deals, including two that Victoria agreed with China in 2018 and 2019, over cooperation with the Belt and Road Initiative, Chinese President Xi Jinping’s trade and infrastructure scheme.
“I consider these four arrangements to be in conflict with Australia’s foreign policy or unfavorable to our foreign relations,” she said in a statement.
China’s embassy in Australia late Wednesday expressed its “strong dissatisfaction and resolute opposition” to the cancellations.
“This is another unreasonable and challenging step that the Australian party has taken against China,” the embassy said in a statement. “It further shows that the Australian Government has no sincerity in improving relations between China and Australia.”
Bilateral ties were strained in 2018 when Australia became the first country to ban Chinese technology giant Huawei from its 5G network. Relationships deteriorated last year when Canberra launched an independent investigation into the origin of the coronavirus outbreak.
The latest move in Australia “is likely to cause further damage to bilateral relations, and will ultimately only harm itself,” the Chinese embassy said.
The federal parliament in Australia in December granted the veto power over foreign transactions by states amid deepening diplomatic talks with China, which imposed a series of trade sanctions on Australian exports ranging from wine to coal.
Liberal Prime Minister Scott Morrison and his predecessor Malcolm Turnbull refused to agree to a country-level MOU with China over the Belt and Road Initiative.
But Victoria’s Labor Prime Minister Dan Andrews has signed agreements with China’s National Commission for Development and Reform to advance the initiative in 2018 and 2019.
Some countries fear that lending the Belt and Road scheme could lead to unsustainable debt levels in developing countries, including the Pacific island region.
Morrison’s government has denied that its new veto is aimed at China, Australia’s largest trading partner and largest source of overseas university students, before the pandemic led the country to close its borders.
Payne said publicly funded states, local governments and universities have generally notified her of more than 1,000 foreign transactions.
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