Australia has the potential to tap into billions of dollars of renewable energy investments from China but only if it changes foreign investment policies and its approach to the superpower nation.
The think-tank Climate Energy Finance issued the predictions in its recent Green Capital Tsunami report, which found Chinese investment in Australia had fallen to a decades-long low despite China’s record investment spending.
The Climate Energy Finance report targeted 130 major green energy technology projects – in solar, wind and hydro electricity, batteries, green hydrogen and electric vehicles – all areas in which China leads the world.
The analysis of investments by Chinese companies found they had spent more than $US100 billion ($A145 billion) on outbound foreign direct investment since the start of 2023.
But the investments were increasingly being made in Europe, Asia, Africa and South America, rather than in Australia or in the US due to restrictive foreign trade policies. In the past decade Australian governments have increasingly aligned with provocative US anti-China foreign policy.
Chinese companies had invested $US613m ($A891m) in Australian projects in 2023, down from $US1.42b ($A2.06b) in 2022.
Australian companies and governments needed to pay attention to the analysis, Australian China Business Council president David Olsson said, and respond quickly to avoid missing financial and environmental opportunities.
“This report makes it clear: we are at a pivotal moment where Australia’s relationship with China can either unlock vast opportunities or see them slip away to other regions,” he said.
“We have the resources and capability but if we don’t create the right environment to attract these technologies and solutions, those investments will go elsewhere.”
The report made four recommendations for changes, including clear and “welcoming” regulations for co-investments in renewable energy projects, a critical minerals reserve trading fund for price certainty, and greater assistance from state and federal governments for prospective Chinese investors.
The changes could boost Australia’s renewable energy expertise, Climate Energy Finance report co-author Xuyang Dong said, and accelerate progress in areas such as green iron exports.
“Australia should work actively with China, transforming our historic dig-and-ship economy in order not to be left behind in the global race to (the) top on energy transition,” Ms Dong said.
“The two great nations with abundant resources in this part of the world can help neighbouring countries catch up with other wealthy nations on decarbonisation of their energy systems and economies.”
Previous changes to Australia’s foreign investment policies, announced before the federal budget in May, included funding for greater scrutiny of projects involving critical infrastructure, minerals and technology and the identification of “national security risks”.
Source: The West Australian, October 2, 2024. https://thewest.com.au/…/australia-may-miss-billions-in…