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SYDNEY: Australia’s parliament passed legislation on Thursday (December 3) giving the federal government the power to veto any deal reached with foreign states, a move that is likely to enrage China and escalate a bitter diplomatic dispute between the two countries.
The law allows the Commonwealth to block any agreement between Australian states, councils or institutions and a foreign government, such as a controversial 2018 agreement between the state of Victoria and China.
“Australia’s policies and plans, the rules that we make for our country are set here in Australia according to our needs and interests,” Prime Minister Scott Morrison told reporters in Canberra.
Morrison has emphasized that the law is not directed at any country, but analysts see it as directed at China.
“It creates another trigger for the relationship to deteriorate,” said Melissa Conley Tyler, a researcher at the Asian Institute at the University of Melbourne.
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Under the terms of the new law, the Foreign Minister can veto any deal with foreign governments if they “negatively affect Australia’s foreign relations” or are “incompatible with Australian foreign policy.”
One deal expected to come into the spotlight is Victoria’s involvement in the China Belt and Road Initiative, which Morrison says weakens the federal government’s ability to control foreign policy.
Morrison declined to comment on whether that deal would be vetoed.
READ: Australian Prime Minister says there is misinterpretation of interests behind China’s tension
Relations between Australia and China, its largest trading partner, have deteriorated since Morrison called for an independent international investigation into the origins of the coronavirus pandemic earlier this year.
Beijing has also been offended by Canberra’s lockdown of a recent agricultural deal, its exclusion of Chinese tech giant Huawei from its 5G network, and legislation prohibiting foreign interference in Australia’s domestic politics.
China has blocked billions of dollars in Australian exports from lobsters to wine in recent months, while refusing to accept phone calls from Australian ministers.
READ: Backing Australia, US State Department Says China Hit ‘New Low’ With Altered Image
Ties soured further this week when a senior Chinese official posted a false image of an Australian soldier holding a bloody knife to the throat of an Afghan boy, prompting Morrison to demand an apology from Beijing.
Australian universities earn billions of dollars in tuition fees from Chinese students, but some of their deals with state-backed Chinese institutions may now come under closer scrutiny.
Last year, Australia’s New South Wales state eliminated a Chinese-funded language program in schools amid fears about foreign influence.
