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Chinese investment in Australia plummets 61% – BBC News

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Chinese investment in Australia plummeted 61% in 2020, the lowest number in six years.

The drop in investment comes amid a growing diplomatic rift between the two countries.

The Australian National University’s Chinese Investment in Australia Database (CHIIA) recorded just over $780m (A$1bn ; £550m) in investment.

Only 20 Chinese investments were recorded in 2020, well below the 2016 peak of 111.

Last year’s decline came on top of a 47% drop from 2019, when Chinese investment totalled $1.57bn.

Dr Shiro Armstrong, director of the East Asian Bureau of Economic Research, where CHIIA is based, said the decline in Chinese investment in Australia outpaced falling global foreign investment last year.

“Foreign direct investment fell globally by 42% according to the United Nations (UN),” Dr Armstrong said in a media release. “UN data is measured differently, but the fall in Chinese investment to Australia was much larger.”

Chinese companies have invested across all sectors of Australia’s economy in recent years, but last year they only bought into the real estate ($357m), mining ($321m) and manufacturing ($119m) sectors.

The drop is at least partly due to Australia’s investment settings during the Covid-19 pandemic.

The government announced temporary measures in March that would subject every proposed investment to scrutiny by Australia’s Foreign Investment Review Board (FIRB).

Previously, a review only applied for “non-sensitive” transactions if the investment was worth $930m, or $213m for investors from countries without a free trade agreement with Australia.

The aim was to prevent a fire sale of distressed Australian assets to foreign owners, but it also delayed investments as the FIRB dealt with a backlog, blowing out the review period from 30 days to six months.

The Australian government also announced additional reforms to its foreign investment laws in July, which added a national security test and allowed the treasurer to cancel deals retrospectively.

In August, the Treasurer Josh Frydenberg stopped the $600m sale of Japanese beverage giant Kirin’s wholly-owned Australian subsidiary Lion Dairy and Drinks to China Mengniu Dairy.

Trade tensions

The latest figures come against a backdrop of increased diplomatic tensions tensions between Australia and China.

Trade ties have been particularly strained since Australia first called for a rigorous investigation into the origins of the Covid-19 pandemic in April.

In response, China has imposed tariffs or trading restrictions on Australian goods such as barley, wine, beef and lobster. In some cases, the tariffs of wine have been more than 200%.

The tensions have also had an impact on coal, with dozens of coal ships stranded off China’s coast unable to unload their cargo.

This has caused alarm in Australia as China is its biggest trading partner, accounting for close to 40% of exports.

Nevertheless, Australia’s trade balance with China hit a six-month high in December, as China’s demand for Australian iron ore made up for restrictions on other products.

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Tesla shares soar more than 14% as Trump win is seen boosting Elon Musk’s electric vehicle company

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NEW YORK (AP) — Shares of Tesla soared Wednesday as investors bet that the electric vehicle maker and its CEO Elon Musk will benefit from Donald Trump’s return to the White House.

Tesla stands to make significant gains under a Trump administration with the threat of diminished subsidies for alternative energy and electric vehicles doing the most harm to smaller competitors. Trump’s plans for extensive tariffs on Chinese imports make it less likely that Chinese EVs will be sold in bulk in the U.S. anytime soon.

“Tesla has the scale and scope that is unmatched,” said Wedbush analyst Dan Ives, in a note to investors. “This dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players.”

Tesla shares jumped 14.8% Wednesday while shares of rival electric vehicle makers tumbled. Nio, based in Shanghai, fell 5.3%. Shares of electric truck maker Rivian dropped 8.3% and Lucid Group fell 5.3%.

Tesla dominates sales of electric vehicles in the U.S, with 48.9% in market share through the middle of 2024, according to the U.S. Energy Information Administration.

Subsidies for clean energy are part of the Inflation Reduction Act, signed into law by President Joe Biden in 2022. It included tax credits for manufacturing, along with tax credits for consumers of electric vehicles.

Musk was one of Trump’s biggest donors, spending at least $119 million mobilizing Trump’s supporters to back the Republican nominee. He also pledged to give away $1 million a day to voters signing a petition for his political action committee.

In some ways, it has been a rocky year for Tesla, with sales and profit declining through the first half of the year. Profit did rise 17.3% in the third quarter.

The U.S. opened an investigation into the company’s “Full Self-Driving” system after reports of crashes in low-visibility conditions, including one that killed a pedestrian. The investigation covers roughly 2.4 million Teslas from the 2016 through 2024 model years.

And investors sent company shares tumbling last month after Tesla unveiled its long-awaited robotaxi at a Hollywood studio Thursday night, seeing not much progress at Tesla on autonomous vehicles while other companies have been making notable progress.

Tesla began selling the software, which is called “Full Self-Driving,” nine years ago. But there are doubts about its reliability.

The stock is now showing a 16.1% gain for the year after rising the past two days.

The Canadian Press. All rights reserved.

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S&P/TSX composite up more than 100 points, U.S. stock markets mixed

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TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.

The S&P/TSX composite index was up 103.40 points at 24,542.48.

In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.

The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.

The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.

The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.

This report by The Canadian Press was first published Oct. 16, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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S&P/TSX up more than 200 points, U.S. markets also higher

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TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.

The S&P/TSX composite index was up 205.86 points at 24,508.12.

In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.

The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.

The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.

The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.

This report by The Canadian Press was first published Oct. 11, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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