Victoria’s Belt and Road deal vetoed by the federal government

China has lashed Australia’s decision to veto Victoria’s controversial Belt and Road deal, warning it will further damage bilateral relations.

China has condemned the Morrison Government’s decision to veto a controversial Belt and Road deal with Victoria, calling it an “unreasonable and provocative move” and threatening retaliation.

In a statement, a spokesman for the Chinese Embassy in Australia said they opposed the decision to cancel the Memorandum of Understanding for the Belt and Road Initiative agreement with the Victoria.

“We express our strong displeasure and resolute opposition,” he said.

The spokesman said the decision was a clear move “against China”.

“It further shows that the Australian government has no sincerity in improving China-Australia relations,” he said.

“It is bound to bring further damage to bilateral relations, and will only end up hurting itself.”

Foreign Minister Marise Payne has vetoed Victoria’s Belt and Road deal with China. Picture: NCA NewsWire / Gary Ramage

He said the BRI had brought “tangible benefits to the participating parties”.

“The BRI co-operation between China and the Victoria state is conducive to deepening economic and trade relations between the two sides, and will promote economic growth and the wellbeing of the people of Victoria,” he said.

Chinese Embassy in #Australia said on Wed that it resolutely opposes Canberra's move to cancel a Belt and Road Initiative deal between Victoria and China, calling it another "unreasonable and provocative" move against #China that will hurt Australia itself. pic.twitter.com/fkyIXad4tP

— Global Times (@globaltimesnews) April 21, 2021

DEALS SCRAPPED

Victoria’s controversial contract with China was vetoed by the federal government after it ruled the deal was not in Australia’s national interest.

In a statement on Wednesday, Ms Payne said the government would cancel both the Memorandum of Understanding and the Framework Agreement between the Victorian Government and the National Development and Reform Commission of China regarding the BRI, signed in 2018 and 2019.

She also cancelled a deal between Victorian TAFE and its Iranian counterpart signed in 2004, and a science co-operation agreement between Victoria and Syria’s higher education ministries in 1999.

“I consider these four arrangements to be inconsistent with Australia’s foreign policy or adverse to our foreign relations,” she said.

Victorian Premier Dan Andrews has previously defended his government’s deal with China. Picture: NCA NewsWire / Andrew Henshaw

The agreements were vetoed under sweeping powers introduced in December amid fears national security was being compromised by lower tiers of government.

Senator Payne on Thursday said the new powers weren’t aimed at “any one country” and Australia would continue to emphasise its commitment to engaging with China.

“It is most certainly not intended to harm Australia’s relationships with any countries,” she told ABC radio.

She rejected the assertion that Australian producers should prepare for more retaliation from China – despite wine and barley producers being slapped with tariffs and customs issues with Australian seafood, coal and timber last year.

The Morrison government’s move to veto the Belt and Road deal has been lashed by Chinese officials. Picture: NCA NewsWire / Martin Ollman

Victoria’s BRI deal with China would have meant increased co-operation and investment between the two on infrastructure, innovation and trade.

However, China has been accused of using the BRI for “debt trap diplomacy” – extending credit to countries that will struggle to pay it back – as well as using deals to undercut other companies for infrastructure bids.

Ms Payne said she had already reviewed more than 1000 agreements since the laws began and expected the “overwhelming majority” of them to “remain unaffected”.

ABC reporter Laura Tingle with Chinese embassy spokesman Wang Xining ahead of a discussion on the “China crisis” at the National Press Club. Picture: NCA NewsWire / Gary Ramage

CHINA’S INTERESTS ‘HURT’

The move comes as China’s deputy ambassador in Australia controversially claimed Beijing had not done anything “intentionally” to hurt the relationship, despite slapping trade sanctions on major exports.

Speaking at the National Press Club on Wednesday Wang Xining said there were instead “many incidents” where China’s interest had been “hurt” by Australia.

Chinese embassy spokesman Wang Xining prior to his discussion on the "China crisis" at the National Press Club. Picture: NCA NewsWire / Gary Ramage

This week a new Human Rights Watch report accused China of “crimes against humanity” for its treatment of Uighurs in Xinjiang, an allegation Mr Wang denied.

The discussion was hosted by NPC President and ABC 7.30 political reporter Laura Tingle, who was initially greeted by Mr Wang with a kiss on the hand.

But he was less enthusiastic when Ms Tingle asked him why a Uighur woman who was also an Australian citizen had been unable to speak to her husband who had been jailed for 25-years in Xinjiang for no clear reason.

Mr Wang pivoted instead, saying the “whole Chinese nation” cared about the welfare of Uighurs.

“We want every ethnic group to thrive, to live a good life, and we know how to deal with it well,” he said.