(Bloomberg) — Australia will tighten scrutiny of foreign investment in mining and refining critical minerals while speeding up approvals in low-risk areas as part of an overhaul of its national regime to boost economic growth.
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Treasurer Jim Chalmers announced the changes in a speech to the Lowy Institute think tank in Sydney on Wednesday, saying Australia welcomes international investment “but only when it is in our national interest”.
“When it comes to foreign investment, the stovepipes of economic and national security have often mismatched in the past,” he said. The government estimates direct and portfolio foreign investment in the Australian economy will have grown to about A$3.5 trillion ($2.3 trillion) in 2023.
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The Treasurer pointed to “foreign investment in critical infrastructure, critical minerals and critical technology” as a focus for efforts to increase scrutiny of international financing. Since taking office, Chalmers has blocked some investments by Chinese-linked companies in Australia’s key minerals and rare earths industries.
Answering a question after the speech, Chalmers played down suggestions that the new restrictions were aimed at China.
“Of course we have a firmer stance on state-owned enterprises, but China is not the only part of the world where there are state-owned enterprises,” he said. “Our approach is non-discriminatory and not country-specific.”
China’s tight grip on the supply chain for critical minerals, such as the processing and refining of lithium and rare earths, has led Australia to work with allies such as the United States, Japan and South Korea in recent years. This latest move by Chalmers builds on previous momentum.
The Chinese government has made clear in recent statements to Canberra that it wants to give its companies greater access to investment in Australia.
At the same time, Chalmers said the investment approval process would be streamlined for well-known investors and low-risk sectors, including a new target for the Treasury to process 50% of cases within 30 days from the start of 2025.
The government will publish an updated foreign investment policy document on Wednesday to inform investors of the new processes, including which parts of the economy will face more stringent scrutiny.
The government will also allow foreign investors to purchase established rental properties to increase demand and incentivize more construction.
– With support from Paul-Alain Hunt.
(Updates with comments from post-speech Q&A.)
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