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Victorian Premier Daniel Andrews’ controversial Belt and Road deal with the Chinese government is expected to be torn up by Prime Minister Scott Morrison within weeks.
The Andrews government blindsided Canberra in 2018 with the announcement that it had signed a memorandum of understanding to take part in the $1.5 trillion infrastructure program, which is widely viewed as a global power play by Chinese Communist Party and a national security threat.
Mr Morrison introduced new laws last year giving the Federal Government power to tear up any state or local government deal with a foreign power if it is deemed “inconsistent with federal foreign affairs policy”.
Speaking to the Herald Sun, the PM said while he would not “pre-empt” that process – which gives states until March 10 to inform the Commonwealth of their deals with foreign governments – he had not seen any advantage from the arrangement.
“I haven’t seen the benefits of it,” Mr Morrison said. “If there are benefits, what are they and what was paid for them? I don’t have the answers to those questions at this point, but the assessment of those arrangements will continue.”
He added that federal policy would determine foreign relations. “That’s a very important principle,” he said. “There has to be consistency when national governments deal with other national governments.”
Mr Morrison had already indicated to Victoria that the deal was unlikely to stand. In November, the CCP cited the foreign relations laws in a list of official grievances making China “angry” with Australia.
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The Belt and Road deal, which Mr Andrews has defended as being about Victorian jobs, attracted increased scrutiny last year as Australia’s relationship with China soured amid the COVID-19 pandemic.
Polling conducted by the Institute of Public Affairs think tank found the majority of Victorians wanted the state to pull out of the controversial scheme, with even Labor voters strongly opposed.
Speaking to reporters last August after the new federal legislation was unveiled, the Victorian Premier said he expected the PM to “no doubt very soon be able to list the full range of other free trade agreements and other markets that we’ll be sending Victorian products to”.
“My concern has always been to grow jobs,” he said. “And I’ve always seen these arrangements and all of our arrangements, not just with any one country but with all the different countries, different states, different provinces, different regions that we have relationships with, they’ve always been about a passport to export.”
He said the deal had “always been about getting more Victorian produce, more Victorian products, more Victorian economic activity”.
Pressed by reporters at the time, Mr Andrews refused to concede the Belt and Road Initiative was a national security threat. “No, I would never concede that point, but again foreign affairs is a matter for the Federal Government,” he said.
Late last year, as relations plunged to new lows after a Chinese diplomat posted a doctored photo of an Australian soldier holding a knife to an Afghan child’s throat, Mr Andrews continued to stand firm on the agreement.
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“No,” he said, when asked by reporters whether he would turn his back on the deal given the latest outrage. “This relationship is far too important to farmers, to manufacturers, to workers, to profits for Victorian companies and therefore prosperity for our state.”
Mr Andrews called on the Federal Government and China to “refocus on trying to repair” the relationship. “I’m confident that the Commonwealth Government knows and understands how important this relationship is,” he said. “I’m certain of that, and that’s why, as challenging as this is, people have to find a way to work through it.”
He also hit out at the scope of the new laws, saying it would allow the Federal Government to interfere in innocuous agreements. “Like, matters of massive international intrigue like sister city arrangements,” he said sarcastically.
“Who Dandenong is the sister city with. Who Monash, where I live, is the sister city with. The federal parliament can do as they please. They are accountable for the decisions they make. If this is the biggest and most important thing for them to be doing at the moment, well, I look forward to them explaining that to everybody.”
Mr Andrews’ position put him at odds with his federal Labor counterparts, who had expressed concern about Victoria’s decision to join Belt and Road. Opposition leader Anthony Albanese last year said he was “very supportive” of the foreign relations laws and that federal Labor had shifted to oppose signing up to the scheme due to the CCP’s growing “interventionist” behaviour in recent years.
In August, Mr Albanese vowed that federal Labor would never seek trade agreements under the Belt and Road Initiative.
“Certainly, there shouldn’t be agreements that are inconsistent with Australia’s national interest, or our foreign policy,” Mr Albanese told the ABC’s Insiders.
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