9 Jul 2010

Chinese ownership 'could increase with rising trade'

7:56 pm on 9 July 2010

Some economists say a large chunk of the economy could end up in Chinese hands if trade with the Asian powerhouse grows substantially as it has in Australia.

Prime Minister John Key, who is visiting major Asian trading partners, has set a goal of doubling trade with China by 2015.

Chinese investment in Australia has increased a hundredfold over the past five years while exports from Australia to China doubled.

Matthew Circosta, an economist with Moody's based in Sydney, says China is buying Australian firms to hedge against rising costs in its factories created by surging demand for Australia's mineral resources.

New Zealand economist Brian Easton says the same thing will happen in this country as exports increase.