Urandaline Investments The topics and structure of this presentation Analyze the magnitude and structure of chinas overseas 1 direct investment in general and to Australia in particular Explain the workings of the FIrB and detail its track record 2 in approving and rejecting investment proposals Consider characteristics that make chinese investment 3 different to other foreign investment to Australia e Discuss the Chinalco Rio Tinto transaction as a case study to 4 better understand Australia's FDI policy
The topics and structure of this presentation 1 • Analyze the magnitude and structure of China’s overseas direct investment in general and to Australia in particular 2 • Explain the workings of the FIRB and detail its track record in approving and rejecting investment proposals 3 • Consider characteristics that make Chinese investment different to other foreign investment to Australia 4 • Discuss the Chinalco Rio Tinto transaction as a case study to better understand Australia’s FDI policy
U randauine Investments Key facts relating to China's overseas direct investment China's odl has increased in recent years, but is still 1 much smaller than FDI(bigger recipient than investor) e Australia is the largest beneficiary of China's overseas direct investment e Mineral resources are the largest part of China's 3 Australian ODI, but this is not the case overall e China has encountered problems in countries other than Australia and usually with natural resource investments ·MIN|NG· METALS· ELECTRICITY·PETR0 CHEMICALS·
7 Key facts relating to China’s overseas direct investment 1 • China’s ODI has increased in recent years, but is still much smaller than FDI (bigger recipient than investor) 2 • Australia is the largest beneficiary of China’s overseas direct investment 3 • Mineral resources are the largest part of China’s Australian ODI, but this is not the case overall 4 • China has encountered problems in countries other than Australia and usually with natural resource investments
Urandaline Investments Over time. China has attracted far more FD/ than OD/ $120 00 $80 U$60 40 20 0 20032004200520062007200820092010 口FD|■0D
Over time, China has attracted far more FDI than ODI $0 $20 $40 $60 $80 $100 $120 2003 2004 2005 2006 2007 2008 2009 2010 Value (US$ billion) FDI ODI
U randauine Investments Official data would suggest Australia is a very minor beneficiary of China's OD/ % o 20032004200520062007200820092010 ·MIN|NG· METALS· ELECTRICITY·PETR0 CHEMICALS·
9 Official data would suggest Australia is a very minor beneficiary of China’s ODI 0% 1% 2% 3% 4% 5% 2003 2004 2005 2006 2007 2008 2009 2010 Share of China’s ODI
U randauine Investments Australia is ahead of all other countries in attracting Chinese overseas direct investment 400 c$300 $200 $10o 0 Australia USA Nigeria Iran Brazil Canada Other Heritage Foundation 2005-10 ·MIN|NG· METALS· ELECTRICITY·PETR0 CHEMICALS· 10
10 Australia is ahead of all other countries in attracting Chinese overseas direct investment $0 $100 $200 $300 $400 Australia USA Nigeria Iran Brazil Canada Other FDI (US$ billion) Heritage Foundation 2005-10