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China anger after Fed Govt tears up Victoria deal

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China has reacted angrily after the Morrison Government stepped in to cancel its Belt and Road infrastructure agreement with Victoria – a decision it says wasn’t intended to inflame diplomatic tensions with Beijing.

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Victoria signed a memorandum of understanding in relation to the Chinese regional infrastructure initiative in 2018 and then signed a “framework agreement” with Beijing in 2019.

Areas of cooperation included increasing participation of Chinese companies in Victoria’s infrastructure program and promoting cooperation of Victorian businesses in China.

It also allowed Victoria’s engineering and design firms to bid for contracts for Belt and Road Initiative projects around the world.

But Foreign Minister Marise Payne announced last night that the infrastructure deal had been cancelled under the Commonwealth’s new veto powers.

The Morrison government in December granted itself the ability to torpedo deals between individual states and foreign powers under the Foreign Relations Act.

Payne said four Victorian agreements would be cancelled, two of which are related to the Belt and Road deal for infrastructure investment.

The other two agreements related to education were struck with Iran in 2004 and with Syria in 1999 by the Bracks and Kennett governments respectively.

“I consider these four arrangements to be inconsistent with Australia’s foreign policy or adverse to our foreign relations,”  Payne said in a statement.

China’s embassy in Australia responded swiftly, expressing “strong displeasure and resolute opposition” to Payne’s announcement.

“This is another unreasonable and provocative move taken by the Australian side against China,” a Chinese embassy spokesperson said in a statement.

“It further shows that the Australian government has no sincerity in improving China-Australia relations.

“It is bound to bring further damage to bilateral relations, and will only end up hurting itself.”

Payne on Thursday said the decision to tear up the agreement was “very careful and very considered”.

“It isn’t about any one country, most certainly not intended to harm Australia’s relationships with any country,” she told ABC Radio National.

“We are asking all countries around the world to respect our government’s decision making authority, and I hope that if there are any concerns, they will be raised directly with the government.

“But we are not going to move away from our principles, which are about protecting and advocating for sovereignty, our national interest.”

A state government spokeswoman told AAP the Foreign Relations Act was a matter for the Commonwealth.

“The Victorian government will continue to work hard to deliver jobs, trade and economic opportunities for our state,” she said in a statement on Wednesday night.

Beijing has previously raised Canberra’s veto power as one of 14 grievances damaging to bilateral relations.

China has in the past 12 months launched a series of damaging trade strikes against Australia after Prime Minister Scott Morrison called for an independent inquiry into the origins of the COVID-19 pandemic.

The Chinese government also remains furious with Australia over foreign interference and investment laws and a decision to ban Huawei from the country’s 5G rollout.

-with AAP

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