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TRADE WARS
Australia-China free trade talks deadlocked: minister
by Staff Writers
Melbourne (AFP) April 18, 2013


Free trade talks between Australia and China are deadlocked over Beijing's insistence on removing investment limits for state-owned enterprises, Trade Minister Craig Emerson said Thursday.

Discussions have been going on for eight years over 18 rounds of talks but the two sides have failed to agree on terms, with Emerson blaming China -- Australia's top trading partner and a country vital to its future prosperity.

He told a forum in Melbourne that Beijing was demanding Australia lift its threshold on reviewing the purchase of assets by foreign states from zero to Aus$1 billion.

"We can't do that, the community would not accept that," Emerson said.

"China is saying, at this stage, non-negotiable, you've got to go from zero to Aus$1 billion (US$1.03 billion)... so that's where we're stuck."

Chinese investment is a sensitive issue in Australia, with telecom firm Huawei banned last year for security reasons from bidding on the nation's broadband rollout.

Rural politicians, meanwhile, have warned against selling valuable farm and mineral land to foreigners. Chinese enterprises often express interest in buying mining and farming land as the nation seeks to secure supply.

The free trade agreement talks cover an array of issues, including agricultural tariffs and quotas, manufactured goods, services, temporary entry of people and foreign investment.

During a visit to Beijing this month, Prime Minister Julia Gillard told her counterpart Li Keqiang the free trade agreement was a "gap" in the relationship that Australia wanted to rectify.

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