Australia strengthens control of foreign takeovers
Jamie Smyth reports from Sydney
The Australian government has tightened its control of foreign takeovers over fears that foreign companies may buy strategic assets at low prices during the coronavirus crisis.
It follows warnings from two government members that struggling aviation and freight companies could become vulnerable to takeovers by state-owned authoritarian regimes, including China.
Josh Frydenberg, the treasurer of Australia, said on Monday that all foreign investment and takeover proposals would now be examined by the government’s foreign investment review committee to protect the national interest. However, he denied that the measures specifically targeted China, noting that Beijing was only the fifth foreign investor in Australia last year, while the United States was the largest.
“These are extraordinary times and we have seen the value of Australian companies, in fact around the world, being severely diminished because of the coronavirus and we do not want predatory behavior that is not in the national interest to take place. happen, “Frydenberg told Australian. radio.
Temporary regulatory changes will apply to existing and new investment proposals. Previously, most takeovers and foreign investments offered by private companies were not accounted for by the Australian government, unless they were worth more than A $ 1.1 billion.
Richard McGregor, analyst at the Lowy Institute, said the new measures were undoubtedly taken with Beijing’s public enterprises in mind, especially since conspiracy theories are swirling about how China is using the crisis as an opportunity to assert its influence.
“But vultures come in many forms, and I think it will eventually apply to many more companies than those in China,” he said.
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