Australia’s national security in spotlight as it steps up screening foreign investments in ‘sensitive’ sectors

Australia’s Treasurer Jim Chalmers on Wednesday unveiled changes to foreign investment rules, describing growing threats from intensifying geopolitical tensions.

To balance economic benefits from foreign investments – which were key to the economy – and to protect national security, Australia would step up screening investment interests in critical minerals, technology and infrastructure.

Chalmers said the overhaul was not targeted at specific countries, such as China, which has been accused of foreign interference in Australia in the past. Any foreign investment applications involving “sensitive data sets” or were close to defence sites would be more closely looked at, he said.

Canberra would also undertake on-site visits of foreign-owned investments while low-risk deals would receive faster approvals.

The nation’s premier bilateral business association, the Australia China Business Council (ACBC), said Chinese investors would not be surprised by the changes.

“[The changes] continue a process by the Australian government that has been under way for some time to enhance a risk-based assessment process for the monitoring and approval of foreign investments,” ACBC president David Olsson told This Week in Asia.

Olsson said investors would welcome a speedier process that comes with the overhaul, given a backlog in approvals, and that they continued to see Australia as an attractive destination for non-sensitive industries.

But to achieve a greener economy, and in an era of “profound energy transformation”, Australia must be open to collaborating with China given its knowledge in green technology, he said.

“To forgo collaboration would be counterproductive in the race to a net-zero emissions world economy, when China is leading