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Australia's Victoria state signs new infrastructure and trade agreement with China

Victoria has signed a new agreement with China under the belt and road initiative (BRI), focusing on working more closely to further develop infrastructure and trade. 

The agreement provides “mechanisms for ongoing cooperation and engagement and identifies areas for cooperation under the BRI MOU”. Under this agreement, the two will increase "the participation of Chinese infrastructure companies in Victoria and opportunities for Victorian firms in China, as well as in third countries”, exploring cooperation in areas of high-end manufacturing, biotechnology, and agriculture technology; care of the aged and enhancing agricultural development.

Premier Daniel Andrews signed the framework agreement with China's National Development and Reform Commission (NDRC) on his visit to Beijing.

Andrews also introduced an AUD80 billion ($55bn) “big build” infrastructure project pipeline to a number of Chinese construction companies at a roundtable meeting. The projects includes the North East Link, Metro Tunnel, West Gate Tunnel, Melbourne Airport Rail Link and the Suburban Rail Loop, according to one statement.

“When Victoria and China signed the Belt and Road MOU in 2018, we committed to delivering tangible benefits for Victorians – with this agreement, we will do just that.” Andrews said. 

In 2018, Victoria became the first Australian state to sign a memorandum of understanding on the BRI. Other Australian states and the federal government have hesitated to formally engage with the initiative, according to Xinhua netThe Sydney Morning Heraldsaid this MOU in 2018 "also attracted criticism from the federal Coalition government".  

Infrastructure expert Eliza Danby of Pinsent Masons, the law firm behind Out-Law, said, “The deal between the Victorian state government and China is a significant development in relations. Victoria is the first state to enter into such an arrangement, and it will be interesting to see whether other Australian states and the federal government follow suit. In the meantime, the deal purports to provide Victorian contractors access to bid on infrastructure projects associated with BRI."

Infrastructure expert Rachel Turner of Pinsent Masons, the law firm behind Out-Law, said, “Although China contractors are already present in the Australian construction market, this agreement will provide further opportunities and a deepening of ties in Victoria.  Following  on from the signing up by Italy to BRI earlier this year, it will be hoped by those promoting the initiative that this is evidence of a softening of the cautious approach adopted by some nations to BRI and will provide a template that will encourage others to engage.”

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