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Forget about the torch relay, writes commentator Stephen Mayne in Wednesday’s edition of Crikey.com, the Australian news and views site. “The biggest issue Australia has with China right now is the Communist country’s extraordinary land grab for our already largely foreign-owned resources dowry”.

Mayne weighs in on a debate that has reached unprecedented levels following recent disclosures in The Australian newspaper that the Australian government has quietly told the Chinese to withdraw for now more than 10 foreign investment applications to buy into Australian resources companies.

That follows much comment and debate about recent moves by Chinese companies to snap up shares in everything from mining giant Rio Tinto to smaller iron ore producers and oil fields (see list below). It also comes after intense speculation - fanned, again, by reports in The Australian - that Chinese companies were plotting a raid on shares in BHP Billiton.

In unfortunate timing for the Chinese, also, The Australian reports Wednesday that China is poised to win its first hostile takeover of a foreign company after lifting its bid for aspiring West Australian iron ore producer Midwest Corp to A$1.36bn ($1.27bn).

Late on Tuesday, Midwest’s board approved a highly conditional bid by Sinosteel which will see Midwest shareholders get A$6.38 a share.

Let’s be clear about what we are facing here, says Mayne: “The Chinese government has launched a co-ordinated strategy to buy up as much of Australia’s strategic resources as possible”.

The following shopping list he has compiled predates last Friday’s revelation that at least 10 more Chinese applications are currently before Australia’s Foreign Investment Review Board. All figures are in Australian dollars (A$1 = US$0.93) unless otherwise stated:

• March 2007: Shougang Corp steel group spent $56m buying 13 per cent of iron ore developer Australian Resources and agreed to fund the US$2.1bn development of the Balmoral South project
• July 2007: CITIC spent $113m lifting its stake in Macarthur Coal from 11.6 per cent to 19.9 per cent.
• September 2007: Queensland government awards Chalco rights to develop $3bn bauxite project near Aurukun
• Sept 2007: Anshan Iron & Steel paid $39m for 13 per cent of Gindalbie Metals and signed $1.8bn joint venture to fund Karara iron ore project in WA
• Jan 2008: consortium of five Chinese companies given FIRB approval to fund $3bn Oakajee port and rail project in WA
• Jan 31, 2008: Shougang Corp spent $400m buying another 20 per cent of WA iron ore company Mt Gibson Iron, but has since been forced to sell for breaching takeover rules
• Jan 25, 2008: Sinosteel spent $100m for more than 10 per cent of WA iron ore hopeful Midwest Corp
• Feb 3, 2008: Chinalco spent $15.5bn for 9 per cent of Rio Tinto shares in London
• Feb 26, 2008: China Metallurgical Group announces proposed $400m acquisition of Cape Lambert Iron’s namesake WA project. CMG already owns 20 per cent of nearby $5bn Sino Iron Project
• April 28, 2008: FIRB approves China Petrochemical Corporation paying $600m for 60 per cent control of the Puffin oil field in the Timor Sea, the first time a foreign government has operated an Australian oil field
• April 29, 2008: Midwest board recommends agreed $1.36bn bid from Sinosteel priced at $6.38 a share.

Adding it all up, Chinese companies - many of them government-backed - have signed deals to spend more than $20bn on companies with a majority of their assets in Australia and in the process have bought the rights to spend another A$15bn-plus directly developing additional projects.Says Mayne:

Add in the wave of applications that FIRB is stalling, the stand-off over iron ore contracts, the rejection of spot price shipments and BHP’s takeover bid for Rio Tinto and our Mandarin-speaking prime minister finds himself in a very tough spot. How about a policy of no more Chinese takeovers unless Australian investors can do likewise in China?

Separately - and just to ratchet up Aussie paranoia - Mayne in his own newsletter, The Mayne Report sets out on Wednesday to list every known foreign government investment in Australian companies, which he says he will track over time.

It would help, he adds, if the FIRB published these lists itself, or if an opposition politician asked Treasurer Wayne Swan to table this sort of information in Parliament, “but for now we’ve just got information available from press reports and stock exchange announcements”.

Related links:
BHP/China: The temperature rises Down Under - FT Alphaville
Stoush! Stoush! - FT Alphaville
The guessing game surrounding China’s BHP/Rio strategy - FT Alphaville
Reports of Chinese merger meddling down under - FT Alphaville