Queensland faces massive economic shortfall as China tensions rise

China is increasing its trade threats against Australia, which could blow a massive hole in the Queensland economy and rock the jobs market. Find out how it could impact you.

A $28 BILLION hole could be blown in Queensland’s economy if China continues to turn off the taps.

China’s increasing crackdown against Australia has caused some consternation in industry and government.

It follows their issuing a warning for Chinese international students against coming to Australia, claiming rising racism against Chinese and Asian people.

The University of Queensland alone is expected to be hit to the tune of $250 million if the threat is followed through on, a report from the Centre for Independent Studies predicts.

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China’s President Xi Jinping. China’s Ministry of Education has issued a warning for Chinese international students not to come to Australia. Picture: Noel Celis/AFP

The hawkish state-run Global Times newspaper, a mouthpiece for the Chinese Communist Party, has warned Australia “must make a real change to its current stance on China, or it will completely lose the benefits of Chinese consumers”.

China has already fired shots on trade, banning six Australian beef exporters, slapping excessive tariffs on barley and warning its citizens against holidaying Down Under.

If the beef ban is expanded, it would cost Queensland $893 million, while a slowdown in tourism – after international travel restrictions – risks more than $1.1 billion.

The latest action follows Australian announcing it will toughen its foreign investment rules and calling for an investigation into the outbreak of COVID-19 which began in Wuhan, China.

As tensions rise, NSW Liberal Senator Concetta Fierravanti-Wells last night crossed the floor to back a crossbench motion calling for an inquiry into Australia’s relationship with China.

Queensland has $28 billion in trade export exposure to China, which could be at risk if tensions rise. Coal, one of the state’s biggest markets, worth about $9.9 billion, though it is considered unlikely to be targeted for now.

It is not the first time China has warned its international students, with a similar threat in February 2018 having little impact.

But Centre for Independent Studies China expert Salvatore Babones said he expected this time it would bite over time.

“This is a ratcheting up of a long-planned program to reduce the number of Chinese students going overseas,” he said.

Centre for Independent Studies Prof Salvatore Babones at Sydney University. Picture: John Feder/The Australian.

Prof Babones said China was seeking to increase the number of students at its own universities, while also seeking to keep more capital within the country.

Trade Minister Simon Birmingham’s Chinese counterpart has not been returning his calls.

Yesterday, Senator Birmingham said there was “no validity at all” to China’s suggestion that Australia was an unsafe destination for visitors or students to travel.

The Government is closely watching trade figures, with the month-to-month flows with China slightly increasing March to April despite the threats.