FARMLAND OWNERSHIP
Ownership of Australia's farmland has entered the local political debate in recent years amid concerns foreign interests are purchasing properties to capitalize on growing demand for higher quality products in Asia.
However Australia's business council has said up to 1 trillion Australian dollars of foreign investment is needed by 2050 for Australia's agriculture industry to meet its full potential and meet demand.
The passing of new regulations through Australia's parliament on Tuesday that were designed to appease local interests is likely to hinder that growth.
Chinese investment into agriculture that exceeds 15 million Australian dollars - down from 252 million Australian dollars - are now forced to be reviewed and approved by the FIRB.
However, other countries are exempt, despite the fact investment into Australia's agriculture sector remains comparatively low to other sectors, according to FIRB.
Singapore and Thailand's threshold remains at 50 million Australian dollars while the United States - Australia's largest direct foreign investor-, New Zealand and Chile will maintain their one billion Australian dollar threshold.
It's a strong message being sent when China and Australia are meant to be great friends after signing the China-Australia Free Trade Agreement.
It's this same agreement China gave unrivalled provisions for Australia's exports that these same local political leaders argued will help transition their economy from mining-led growth.
Australian analysts have told Xinhua Chinese investment into Australia's economy is a positive thing and should be encouraged.
Australia's Trade Minister Andrew Robb is openly trying to attract Chinese investment into Northern Australia to help spur growth, highlighting the commercial potential.
However, why should Chinese investment dollars that are wanted and needed in other parts of the world be subjected to an unfair, unequal playing field?
The main driver to the legislated and regulatory resistance are the xenophobic domestic political forces needed to appease conservatives following the ousting of former PM Tony Abbott in September's backroom party coup.
The sensitivity surrounding foreign investors in Australia's rural and farming communities, perhaps even antagonistic to certain countries, have local politicians attuned to keeping their constituents happy for the next election.
Maybe these constituents should know in 2014 the United States accounted for 163.4 billion Australian dollars worth of direct foreign investment into Australia, compared with China's 29.97 billion Australian dollars, according to the Australian Bureau of Statistics.
One of the only advantages Australia had post-GFC was its overwhelming abundance of hard commodities, however their transitioning from mining-led growth is likely to be much harder without foreign investment in agriculture and infrastructure.
Australia's largest trading partner, China, is transitioning to consumption-led growth and has high demand for the products Australia offers - if they can meet their potential - but Australia it's not the only country that can offer them.
Chinese businesses, like all businesses, don't expect special favors from governments, only a fair and equitable playing field. When the playing field isn't fair and more and more barriers are put up, like any business, they will reassess their priorities.
