Money Minute – December 11 2017 Delicate China

Australia’s relationship with China is vital to our national interest. The integrity of our national security and intelligence – well that’s equally as important as well.

As of June this year, China is our biggest import market, biggest export market – so our biggest trade partner.

By far, the biggest export is Iron Ore – about $44 billion. Followed by coal, that’s about $8 billion and gold that’s about $2.4 billion.

But – from that you can see how important Iron Ore is to China. To its steel industry, to building its infrastructure. From China, our biggest import is Telecommunications gear – worth almost $7 billion a year.

Followed by computers – $4.7 billion.

Now to think also 1.2 million Chinese tourists came here to Australia last year, and that forecast to rise to 3.3 million a year, within 10 years.

This year, universities Australia noted $21 billion of education export earnings, making the education of international students by Australian colleges and university our third largest industry, behind Iron Ore and Coal. Most of those students – well, they are Chinese.

So when China’s embassy in Australia last week put out scarifying statement saying, among other things, stories about Chinese influence and Chinese infiltration are made up out of thin air – “they are filled with cold-war mentality and ideological bias” – you gotta listen up.

The government is now seeking reforms in the ways foreign powers interfere in Australia’s political affairs to curb the use of Chinese or other foreign nations, to influence our elections or our policies.

There have been warnings about this – back in October the head of the department of foreign affairs and trade, Francis Anderson, urged universities to protect themselves from the rising influence  of the Chinese Communist party. It was followed by no less than the ASIO boss, Duncan Lewis, saying government has to be very conscious of foreign interference in Australian universities.

I suspect that a policy that’s strong on security, but without paranoia or racist undertones is the key here. It’s a very delicate thing to pull off.

Markets

The Dow Jones on Friday up 170 points, The Dollar just over 75 US Cents.

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