China angry as Victoria's 'Belt & Road' infrastructure deal is scrapped

The Australian government has scrapped Victoria's Belt and Road deal with China.

The Australian government has scrapped Victoria's Belt and Road deal with China. Source: Getty Images

The Australian government has exercised its veto powers to cancel two agreements negotiated with China by Victoria, saying it is acting to protect the national interest. China is warning the scrapping of the Belt and Road Initiative agreements risks further harming bilateral relations.


Concerns over foreign interference led to the creation of the federal government’s new veto laws, the Foreign Arrangements Scheme, which came into force last year in December.

In particular, worries had been raised about Victoria's 2018 and 2019 deals with China on its global infrastructure and development strategy, the Belt and Road initiative.

The veto powers allow the Foreign Minister to scrap deals negotiated with foreign countries by Australian states that are deemed against Australia's foreign policy. 

In the first use of the power, four deals negotiated by the Victorian government have been vetoed.

There are two deals with China, and also agreements with Iran and Syria.

The 2004 deal with Iran was on student exchanges, and the 1999 agreement with Syria related to scientific cooperation.

Foreign Minister Marise Payne says the decisions were made after careful consideration.

"My task is to determine whether or not they are consistent with Australia's foreign policy, whether they are adverse to Australia's foreign relations. And the determination that we have had formed is that they are not consistent with Australia's approach to foreign policy and under our legislation will be terminated. I do expect that there will be further decisions to be made in due course and they will be informed by advice from my department on the consistency of all of those arrangements with the relevant legal test as it set out in the legislation."

Click on the player at the top of the page to listen to this audio in Punjabi.

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