Mandarins in Beijing for final talks on China free trade agreement

By Latika Bourke
Updated September 1 2014 - 7:18pm, first published 6:13pm

A high-level delegation has left for Beijing for a final, critical round of formal negotiations on a free trade agreement with China, which the Australian government is hoping to finalise in time for the G20 summit in November.

Fairfax Media understands the government is prepared to offer China the same $1 billion general screening threshold for private investments that it gave Korea and Japan in agreements concluded this year. It means non-state-owned investors would no longer be required to have their proposals approved by their foreign investment review board unless the value of the investment exceeded $1 billion. There would be the same policy space reserved to screen proposals of a lower value in the sensitive sectors of agriculture and agribusiness.

Trade Minister Andrew Robb described the Chinese as "tough negotiators" but has constantly said he believes there is "sufficient political will" on both sides to secure a deal. Mr Robb said in all trade negotiations, the closer you get to an end point the more difficult it becomes, and reached for a Chinese proverb to illustrate his point. "It reminds me of an old saying a Chinese associate shared with me, 'We've embarked on a 100-mile journey and we are 90 miles in, so we are nearly halfway there'," Mr Robb said.

The current threshold is $284 million for all investors except from the United States and New Zealand, plus Korea and Japan once those FTAs have been domestically ratified. 

Australia is pushing hard for access to China's growing services sector so Australian providers - including engineers, project managers and wealth management experts - can advise the Asian giant's growing middle class.

China wants more access for its own citizens to work on Chinese-funded agriculture and infrastructure projects.

Sources said the Australian government would not be taking an "open slather" approach to labour mobility issues and that China was not expecting one anyway.

Australia's dairy and sugar producers feel they missed out in the recently concluded free trade agreement with Japan and are looking for significant access to China.

The 21st round of discussions began on Monday and will last the week. They are likely to be the last and will cover all chapters up for negotiation.

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