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Western Australia

Musings on the Middle Kingdom

18 September 2014

Earlier this year, ACBC WA was glad to host Nathan Backhouse (Regional Director China - Department of State Development) in giving a presentation on 'Musings on the middle kingdom'.
Nathan spoke to attendees of the sundowner about the lack of perspective in the west of what we are dealing with in a non aggressive, yet resurgent, assertive China.
Nathan spoke to the key area of understanding politics in China. President Xi Jinping is, in Nathan's opinion, the most powerful man in China since Chairman Mao Zedong left the stage. He is the chairman of the military commission, chairman of the security commission and is committed to a new, purist model of China. Nathan spoke about the requirement on China by the West to play a more regional role, however reminding us that China has been a more 'insular' people that has been more focussed on keeping people out than exerting itself externally. Saying this, the current elite in China are committed to things such as the Shanghai free trade zone with broad policies to free up the currency and engage in more trading, and have decreased regulations on Chinese nationals sending money 'out' of China for overseas investments.
He spoke to the effect of our (Australian) politics in China. Comments made by our politicians in Australia are taken very seriously in China, and can be taken offensively. 
President Xi's reign has so far seen a major crackdown on corruption, tightening of the shadow banking industry and dealing with major issues in the housing market.
An interesting point Nathan brought to the forum, was that whilst it is widely known that a lot of the China infrastructure being developed seems to age quickly, the 600bn RMB project developing the high speed network down the eastern seaboard has shown that things can be done differently. It is one of the longest tracks in the world, and also one of the most used in the world and is earning the investment back quickly. It has become an example of the strength of China's emergence in high quality infrastructure, and at massive scale.
As the WA government state representative in China, Nathan also informed us of some of the key sectors of focus for WA in the future. These included:
  • Oil & Gas
  • Mining
  • Agriculture
  • Property
  • Technology
  • Tourism 
  • Education
Whilst mining is mentioned here, it has significantly slowed down in demand from the China-end. An example given was that if the Shanghai representative office was previously receiving 10 queries a week for Mining information, there is now only 1 per week. However, if there was previously 1 enquiry per week on Agriculture, ther are now 10 enquiries per week; signifying the shift in focus and opportunity.
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