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November 7, 2023
Taxpayer dollars are being invested in at least 50 high risk Chinese companies linked to the Communist Party and oppression of Uyghurs in Xinjiang through Australia's sovereign wealth fund.
A new audit of the Australian Government Future Fund, which is used to strengthen the government's long term financial position, identified investments in 22 companies directly or indirectly associated with the Chinese Communist Party.
The audit, commissioned by the Shadow Home Affairs and Cyber Security Minister James Paterson, also identified investments in 14 companies associated with the oppression of the Uyghur minority in Xinjiang province.
One of those was Shandong Nanshan Aluminium Co. Ltd, a major buyer from a Xinjiang industrial giant reportedly involved in the Chinese governments so-called labour transfer programs in the province.
A further 14 companies with investments in countries Australia has sanctioned, including Russia, were linked to Future Fund.
Senator Paterson said the companies spanned broad portfolios.
"The striking thing is it's across so many different industries from beverages to energy to finance, to healthcare, IT, manufacturing and materials," he said.
"These are companies that are either controlled by, or linked to the People's Liberation Army, companies that are involved in the oppression of Uyghur minorities in the Xinjiang province, companies that have been banned or sanctioned by our allies and partners or companies who have benefited from the industrial scale intellectual property theft of the Chinese Communist Party."
Australian allies have previously blocked some of the identified companies, including in the United States, Canada and Europe.
Zangge Mining Co. Ltd, one of the companies the Future Fund invests in, was ordered to divest their holdings in Canadian critical minerals due to national security concerns.
US authorities have reportedly also identified two other companies on the Future Fund's list of investments as major beneficiaries of trade secrets stolen in 2014.
Senator Paterson said the audit findings highlighted the need for further action.
"If any investment fund in Australia was going to have robust policies and procedures in place to prevent this from happening you would think it would be the government-controlled future fund," he said.
"I think this does really highlight the need for guidance to be provided to investors about how to mitigate this risk or possibly some outbound investment restrictions which the Albanese government has said they are considering following a decision of the Biden administration to impose them."
This is not the first time the Future Fund's investment choices have been called out.
In 2021 documents released under Freedom of Information laws revealed the fund held almost $158 million in 14 public companies with links to Myanmar's military.
That list includes an arms manufacturer known to sell fighter jets to the junta.
The Fund previously invested in Adani, the company behind a controversial coal mine in Queensland.
