The State Government rolled out the red carpet for Chinese investment in farming, fishing and aquaculture yesterday after granting Shanghai Zhongfu exclusive rights to develop prime land on the Ord River.
It also sent a clear message that the Chinese conglomerate will need to meet the cost of extending the irrigation scheme over the Northern Territory border to grow sugar cane on 40,000ha as part of an overall investment estimated at $1.5 billion.
Premier Colin Barnett confirmed that Shanghai Zhongfu, trading in Australia as Kimberley Agricultural Investments, was the preferred developer of 13,400ha released under the latest stage of the irrigation scheme, which is fed from the huge reserves of Lake Argyle.
He also blasted critics of Chinese investment in Australia, saying WA had prospered on the back of foreign investment and was 20 years ahead of the rest of Australia in its engagement with Asia.
"This is a very welcome investment and I think it will be the forerunner of more overseas investment, particularly from China, into agricultural industries, maybe into the fishing industry, aquaculture and other areas," Mr Barnett said.
KAI will pay the State Government a nominal rent to develop the Ord land into farms, with leases ranging from 10 to 50 years.
Jian Zhong Yin, the vice-president of Shanghai Zhongfu and KAI chief executive, confirmed yesterday's announcement was just the first step in plans to farm sugar cane in WA and the NT.
Speaking through an interpreter, he said the land in the NT was needed to make construction of a state-of-the-art sugar mill in the Kimberley economically viable.
Construction of the mill, estimated to cost about $450 million, is not expected to start until 2016.
It is understood the mill will be built near the border, central to KAI's farms on both sides, and produce food-grade sugar and ethanol for export from Wyndham.
KAI must finalise a deal with the NT Government and meet environmental and native title requirements before it can proceed with its plans.
Native title owner the Miriuwung Gajerrong Corporation, which received a significant share of the land released yesterday to develop its own farming interests, was cautious in welcoming the chance to work with KAI.
MGC chairwoman Edna O'Malley, who along with former chairman and current director Teddy Carlton has already worked closely with the State Government on creating employment and business opportunities for indigenous people, said her goal was to provide lasting social and economic benefits for the Miriuwung Gajerrong.
The State and Federal governments invested $512 million in infrastructure preparing for the Ord expansion and its impact on communities in the Kimberley.
Regional Development Minister Brendon Grylls said the State Government had spent $311 million extending the main irrigation channel by 31km and on roads and other infrastructure. He said KAI would need to invest in irrigation channels on about 7000ha of the Ord land allocated yesterday and then look to extend the irrigation scheme into the NT, a project which could take 10 years to complete.
"The taxpayers have made their investment into the backbone infrastructure," Mr Grylls said. "From now on we want the private sector to drive the investment and the expansion."
Representatives of the State, Federal and NT governments will meet in Kununurra on Friday to sign a memorandum of understanding on the next stage of the Ord expansion.