China is demanding it be allowed to import Chinese workers into Australia to work on projects funded by Chinese investors under a proposed free trade agreement, sparking concerns within the Abbott government of a backlash, according to reports.
An Australian Financial Review report says that the government is resisting the move and is seeking a way around the issue by targetting 457 visas towards projects that the Chinese want to build that require skills that cannot be obtained in Australia as it pushes to land a free trade deal with China at the Group of 20 meeting in November.
Chinese President Xi Jinping will attend the G20 meeting and it is believed that imported labour and investment remain the two obstacles in signing off on a deal.
Prime Minister Tony Abbott has already changed his previous opposition to Chinese state-owned businesses investing in Australia and signalled he would offer these enterprises special treatment by removing or changing the requirement that all investments have to be approved by the Foreign Investment Review Board.
A senior rural Coalition MP, who wished to remain anonymous, said the prospect of investment by Chinese state-owned enterprises could create concern among rural Coalition MPs. But Queensland Nationals MP Bruce Scott said the plan should be welcomed as investment was needed to boost jobs and the economy.
China will be offered the same conditions as South Korea and Japan, which will lift the FIRB threshold from $248 million to $1 billion for investment by a private company. As most Chinese companies are state-owned, Mr Abbott began prosecuting the case in Shanghai last week to allow SOE's to invest in Australia.
The government wants Chinese money, especially to develop new agricultural projects and build new infrastructure in the nation’s north.
A source said the Chinese were ''pushing pretty hard'' to allow them to bring in their own workers to build and, in some cases, operate such projects, especially in regional areas.
The government, keen not to cruel the FTA, is looking at other ways of appeasing the Chinese.
The 457 visa system is being reviewed by the government and one option would be to offer the Chinese 457 visas for specific projects, should the skills and labour not be available domestically.