A recent former Australian ambassador to Beijing, Geoff Raby, says the Sino Iron project in Western Australia, which is the subject of a bitter dispute between Clive Palmer and a Chinese-owned company, has become a warning to other Chinese investors looking to do business here.
Dr Raby said there was ‘‘right and wrong on all sides’’ in the dispute.
But he said the Sino Iron project ‘‘is the exemplar in the Chinese mind of what can go wrong when you invest in Australia. It's on the top of everyone’s talking points [ in China], when you talk about investing in Australia, they refer to that.’’
Dr Raby said the project stemmed from a ‘‘period when China rushed into Australia and didn’t do due diligence... Now what they say is, with all the mistakes they have made, not only in Australia but elsewhere, they have ‘ paid their tuition fee’. They are getting better, they understand the need for more local knowledge.’’
Beijing-based Dr Raby now consults to Australian business in China, but is a former deputy head of the Department of Foreign Affairs and Trade, and was ambassador to China from 2007 to 2011.
Billionaire MP Mr Palmer has been battling the operators of the Sino Iron project, Hong Kong-based CITIC Pacific, over disputed royalties, and $12 million lodged in a fund for managing the nearby Cape Preston port, which the Chinese company accuses him of misusing. The dispute is now before the courts. Located in the Pilbara, the project is billed as one of China’s largest investments in Australia’s resources sector.
Dr Raby says in the Chinese business world, ‘‘more than anything else, everything is relationship-based. It's not about the black letter law, it's about trust and relationships.’’
He says no country will ever be as important to Australia as China, and politicians need to build a ‘‘positive narrative around why this is good for Australia’’.
