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On August 25, the Morrison-led administration said that allowing a Chinese firm to buy an Australian company ‘would be contrary to national interests’
New Delhi: In a move to put a check on Chinese economic expansion in domestic market, the Australian Government has blocked bids from Beijing-based firms to buy a major national company. Australia’s decision to attack the Chinese on the economic front comes on the heels of the nation joining hands with India and Japan to lessen its essential commodity dependence on Beijing. The three nations have begun discussions on launching a trilateral Supply Chain Resilience Initiative (SCRI), led by Tokyo, with the aim of reducing dependency on Beijing’s manufacturing sector.
In its latest move against China, Prime Minister Scott Morrison-led Australian Government has banned a Chinese company from buying a major dairy producer. The Morrison-led administration on 25 August in an official statement said that allowing a Chinese firm to buy an Australian company ‘would be contrary to national interests.’
According to reports, China was aiming to buy the Lion Dairy and Drinks company. With a valued sale of $430 million, the company, currently owned by a Japanese firm Kirin, had been awaiting regulatory approval since November 2019.
Following the government’s decision, the dairy company in its press release said that ‘Given this approval is unlikely to be forthcoming at this time, Lion and Mengniu Dairy have mutually agreed to cease the current sale process.’ This led the Chinese company to immediately drop its bid and exit the deal.
Soon after the novel coronavirus pandemic hit the world, the Australian government moved to tighten rules covering foreign investment in the country. The administration imposed temporary measures allowing increased oversight on takeovers of local firms during the pandemic.
Meanwhile, China left humiliated due to the Australian offensive refused to provide any comments. Chinese Foreign Ministry denied giving any statements to the international media during the routine briefing on 25 August. However, it did give out a line directed at Australia calling for the provision of ‘a fair and just business environment for Chinese firms operating and investing there.’
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Diplomatic and trade ties between China and Australia have continued to nose dive ever since PM Morrison joined the calls for an independent inquiry into the coronavirus pandemic, which was first detected in the Chinese city of Wuhan in October 2019. Beijing, which has been Canberra’s biggest trading partner, has since threatened economic blowback on Australian goods including beef, barley, and even some seafood. Sanctions were also imposed on the tourism sector and higher education.
