PRIME Minister Julia Gillard has reassured China that Australia is open to foreign investment ahead of signing an historic “strategic partnership” deal with Premier Li Keqiang involving annual summit talks between the two countries’ leaders.
The agreement will be signed in a formal ceremony in Beijing on Tuesday at the Great Hall of the People, a move that’s been hailed as a significant upgrading of bilateral ties.
Ms Gillard used a speech in Shanghai on Monday to encourage China to open its economy further and drive social reform, citing Australia’s own journey to modernise.
“The growing importance of China’s domestic and social reforms – like strengthening health care and expanding social security – will denote a growing importance for local and provincial leadership,” she told the China Executive Leadership Academy on Monday.
“This has long been vital to your social and human development.
“In coming decades, it will be vital to balancing and sustaining national economic growth – vital to national success.”
Ms Gillard earlier on Monday announced an agreement to allow direct trading of the Australian and Chinese currencies for the first time.
The Australian dollar will join the Japanese yen and the US dollar to become the third currency to enjoy the benefits of direct yuan trading, which should make it easier for businesses to transact with each other and offer better rates to tourists.
“This reflects the rapid growth of our bilateral trade and the value of two-way investment,” she said.
Ms Gillard pointed to Australia’s experience in taking difficult but necessary steps to modernise its economy by floating the Australia dollar, cutting tariffs and opening up its financial sector to foreign competition.
“Australia is a stronger, fairer, smarter nation as a result,” she said.
She defended Australia’s foreign investment and environmental protection rules after being asked by a Chinese academy student about the foreign investment debate, following comments by Nationals Senator Barnaby Joyce that not all investment by China was in the national interest.
“We are a capital-hungry economy,” Ms Gillard told the academy.
“Australia is open for investment.”
Investment in Australia is a touchy issue in China after a series of outbursts by some commentators, particularly over buy-ins of rural and mining assets by Chinese state-owned enterprises.
During Labor’s term in office, 380 investment proposals from Chinese companies had been accepted.
“Only six of them had conditions put on them and none – not one – has been rejected,” Ms Gillard said.
On environmental protections, Ms Gillard said Australia’s “sophisticated environmental management” rules weren’t specifically directed at foreign investors.
“There is one rule for everyone,” she said.
The prime minister is now halfway through her China trip and heading to Beijing, where she will meet Premier Li Keqiang.
Ms Gillard is likely again to raise concerns about an escalation in North Korea’s anti-US and South Korean rhetoric, which has aroused fears the North could start a war on the Korean peninsula.
Ms Gillard is expected to hold talks with business leaders and education-sector representatives in Beijing on Tuesday. – AAP