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Chinese Investment in Australia Expands, Increases, and Shows the New Normal

According to the 11th Demystifying Chinese Investment in Australia report by KPMG and The University of Sydney, Chinese investment into Australia expanded into new areas such as healthcare in 2015, while the flow of Chinese investment grew by 59.5% in AUD terms, or 32.9% in USD terms, between 2014 and 2015.

Investment increased by AU$15.1 billion (C$15.2 billion; US$11.1 billion) in 2015, up significantly from 2014’s AU$9.406 billion (US$8.35 billion) inflow of Chinese investment. This brings the total invested between 2005 and 2015 up to US$78.680 billion. Announced, legally binding deals numbered a record 65 in 2015, with seven of these deals valued at greater than or equal to AU$500 million. Of the total invested, 49.3% went into Australia’s most populous state, New South Wales, which also contains Australia’s largest city, Sydney. The share of private investment from Chinese investors was noticeably high, at 78%.

Perhaps more significantly, the report notes that 2015’s investment often targeted areas such as services, health, and lifestyle rather than a previous major target, mining, showing a new normal for Chinese investment in the country. A striking example can be seen when comparing healthcare, which received 17% of Chinese investment, to mining, which received just 9%. Some AU$6.85 billion, or 45% of Chinese investment that year, went into real estate, while agribusiness received AU$375.2 million in investment through 12 deals. The total invested was also buoyed by a large renewable energy investment, which brought in 20% of the year’s value.

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