Chinese Firm to Take on Ord Expansion Project in Western Australia

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By Esther Tanquintic-Misa | November 14, 2012 3:07 PM EST

China's Shanghai Zhongfu Group could be awarded rights to rights to develop the second stage of the Ord East Kimberley Expansion project in Western Australia, The Australian said in unconfirmed reports on Wednesday.

The Australian newspaper said it received insider information that the Chinese private company has been given rightful access to develop the more than 15,000 hectares of land in the Ord region.

The West Australian government, however, had yet to confirm the news report.

"The state government hasn't made the decision and the announcement won't be made until next Tuesday," a spokesman for the state's minister for regional development said in an issued statement.

Tax issues, however, hound the Chinese business project. The said deal to develop a significant portion of the Ord East Kimberley was claimed not to undergo rigid scrutiny by the Foreign Investment Review Board because no land is being sold to the Chinese.

"But what happens to the produce? Will it be sold to a related entity in China? If sold there, so no tax is paid here?" Senate Leader Barnaby Joyce was quoted by The Australian.

"Australians are entitled to know whether this operation is going to go through the commercial market," NSW Liberal Bill Heffernan said in a related report. "If it is not for sale, how do we collect tax?"

A little-known private company, Shanghai Zhongfu Group has no agriculture interests in China. The Kimberly project would be its first investment in Australia, according to Reuters News.

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