Chinese Non-Resources Investment in Australia: Current State and Outlook

Qiuming Gao

Economic Papers, 2014, vol. 33, issue 4, 362-373

Abstract: type="main" xml:id="ecpa12089-abs-0001">

This article presents the first study of Chinese non-resources investment in Australia. It begins by providing an overview of China's global and Australia-bound investments. We find that the small non-mining stock in Australia may be related to Australia's particular orientation in China's Go-Abroad Policy and the current composition of outbound Chinese investors. Our research reveals four nascent indications that Chinese FDI in areas beyond resources is poised to expand: (i) China's exports to Australia have started to shift from primarily consumer goods to durable goods, which may spur sales and maintenance investment from traditional manufacturers; (ii) machinery producers have started to invest abroad, using Australia as a developed-market testing ground; (iii) the growing pool of Chinese academics as well as Chinese graduates of Australian universities have helped to attract technology-seeking FDI; and (iv) manufacturing investment and investment by private investors has increased as a result of recent adjustments to the Go-Abroad Policy. A further look into the characteristics of established Chinese subsidiaries suggests the increase in Chinese non-resources investment is likely to make positive impacts on local employment–an effect bigger than its monetary value.

Date: 2014
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