Australia cancels Victoria state's Belt and Road deals with China

Australia cancels Victoria state's Belt and Road deals with China

"It further shows that the Australian government has no sincerity in improving China-Australia relations", a spokesperson said in a statement.

Deploying Australia's powerful new veto powers under legislation passed a year ago for the first time, the Federal Government ended the deal, warning it was against Australia's interests.

Payne's statement also calls for agreements signed between Victoria and Iran, as well as Victoria and Syria, to be terminated.

Reviewing past deals with other nations, Payne on Wednesday also said she would revoke a 2004 memorandum of undertstanding between Victoria state and Iran on education as well as a scientific cooperation agreement with Syria of 1999.

The Sydney Morning report said that the Morrison government and national security experts were concerned that China was using the agreement with Victoria as a propaganda win to claim the that state government had broken ranks with Australia's China policy. Beijing protested that the laws were prejudiced against China and poisoned Chinese-Australian relations.

"This is another unreasonable and provocative move taken by the Australian side against China", according to the embassy.

Australia has cancelled the controversial Belt and Road (BRI) agreement with China saying it goes against its national interest, in a decision that will further increase tensions between Canberra and Beijing.

Payne, who makes the determinations under the foreign arrangements scheme, said the agreements were "inconsistent with Australia's foreign policy or adverse to our foreign relations" under the scheme's test.

The agreements with China are the memorandum of understanding on the belt and road initiative signed in October 2018, and a subsequent more detailed framework agreement signed in October 2019.

Seen as a bold bid by President Xi Jinping for geopolitical influence the U.S. has been particularly critical of China's so-called "debt diplomacy". Relations worsened a year ago when Canberra called for an independent probe into the origins of the coronavirus outbreak.

A Victorian government spokeswoman told national broadcaster ABC: "The Foreign Relations Act is entirely a matter for the Commonwealth government".

Beijing has previously raised Canberra's veto power as one of 14 grievances damaging to bilateral relations.

China is Australia's largest trading partner and before the pandemic, its biggest source of overseas university students.

In 2018, Canberra staged an worldwide first by banning the Chinese tech giant Huawei from Australia's 5G network.

Payne said Wednesday she had been alerted to more than 1,000 arrangements between foreign governments and Australia's states and territories, local governments and public universities since the laws were enacted.