While PM Abbott is busy with an FTA, China has moved to give WA access to its live cattle market:
WA Premier Colin Barnett was in China on Tuesday to witness the signing of a Memorandum of Understanding, which could see cattle shipments start as early as next year.
…“It could be an absolute goldmine if we were able to service the China market,” said Sheldon Mumby, spokesman for the Pastoralists and Graziers Association of WA. “It is especially important as many of our other live export markets have tightened up.”
…Shipments of Australian beef to China have jumped 930 per cent over the past year, after a crackdown on smuggling and a series of food scandals in China. China is now the third largest buyer of Australian beef, behind the United States and Japan. But these surging volumes look to have unsettled Chinese authorities, who slapped a ban on chilled Australian beef in late August. Concerns over food safety were cited, but the measure is being viewed by producers as a non-tariff barrier designed to protect the local industry.
In my quick study of agribusiness yesterday I noted that raw agribusiness exports have boomed in the past six years. This has not appeared in beef exports at all:
So the deal is welcome.
Meanwhile, the update on China FTA negotiations is not as encouraging:
China is sticking to a demand Australia relax restrictions on foreign investment, wants Canberra to introduce a working holiday scheme for Chinese citizens and streamline entry for its business people.
As part of a free-trade deal, Australia wants better access for farmers and better access to invest in China’s financial, legal, banking, education and environmental services industries.
There is some hope Australia can get a better deal from China on beef and dairy and China has relaxed restrictions on dairy imports due to milk contamination scandals. The outlook is bleaker for other commodities, including rice and sugar, which Beijing wants to protect from competition.
Basically China wants easier access for investment and to import its own labour on holiday visas. Given investment is totally dominated by remote resource projects that are typically massively over budget one can understand why. But you’ve got to ask yourself, if the capital and labour are both imported, with commensurate opportunities for ducking the tax take, what’s the point in owning the dirt at all?
On the flip side, one wonders why we object to Chinese capital owning agriculture. If it expands production from what it would have been, increases competition and uses local labour then what’s the downside?
Of course, having set a political deadline for negotiations we’ve ensured we’ll get the worst outcome.
