What does CHIIA data cover?
CHIIA currently produces data on the equity component of Chinese direct investment in Australia, by ultimate beneficial control. To qualify as direct investment, the investment must result in the investor holding at least 10 per cent in the Australian entity. ‘Ultimate beneficial control’ means the origin of the investment is defined by who ultimately controls the investment.How is CHIIA data produced?
CHIIA data is produced using the definitions, standards and processes set out in the CHIIA Methodology. The CHIIA Methodology provides a way to consistently identify, verify and produce data based on public information.Who produces CHIIA data?
CHIIA data is produced at the East Asian Bureau of Economic Research, in the Crawford School of Public Policy at the Australian National Univeristy.What does CHIIA data tell us about Chinese investment in Australia that we didn’t know before?
CHIIA is therefore the only source of data on Chinese investment in Australia, public or private, which defines investment by ‘who’ the investor is and when the identified investment is realised. These technical distinctions are important. The immediate source does not necessarily reflect ultimate ownership of investment. Announced investments may not be realised. CHIIA data is therefore materially different from other sources, providing a new perspective on Chinese investment in Australia.
How does CHIIA data differ from other sources of data on Chinese direct investment in Australia?
- CHIIA defines the source of investment (that is, China) by ‘who’ the investor is, not where the funds last came from.CHIIA defines the source of investment by ‘ultimate origin’. This approach is shared with The American Enterprise Institute’s China Global Investment Tracker series and The University of Sydney–KPMG series (which are in the same row of Chart 1), but not with the Australian Bureau of Statistics (ABS), which defines the source of investment by ‘immediate origin’. This distinction has one important implication. The data measures investment which is ultimately owned in China no matter what its geographic pathway to Australia.
- ‘Ultimate origin’ means CHIIA looks past lines on a map.Traditionally, foreign investment is ‘foreign’ if it crosses a border – no matter who is undertaking the investment. CHIIA does not require investment to cross a border. This means CHIIA records specific investment activity by Chinese subsidiaries in Australia, while traditional FDI statistics may not.
- CHIIA defines transactions as occurring when the investment is realised, not when contracts are signed.This approach is also shared by the ABS and CHIIA, as shown in Chart 1. The China Global Investment Tracker and the University of Sydney–KPMG instead record investments by date of contracting.
Chart 1: Technical distinctions
Date of investment
|Dated by contracting||Dated by realisation|
|Source of investment by immediate origin||–||ABS|
|Source of investment by ultimate origin||
AEI China Global Investment Tracker
University of Sydney–KPMG