Australia lets Chinese buy huge cotton farm

The Australian government said Friday it will allow the sale of the nation's giant Cubbie cotton station to a consortium led by Chinese textile company Shandong RuYi. Rural conservative politicians have warned against selling valuable farming land to foreign investors, particularly China, which is Australia's top trading partner. But Treasurer Wayne Swan said textile firm Shandong RuYi Scientific and Technological Group Co. and Australian firm Lempriere were approved to acquire the Cubbie Group subject to a number of undertakings. "Critically, RuYi has undertaken to sell down its interest to no more than 51 percent within three years," Swan said, adding that it will initially own 80 percent of the group and Lempriere 20 percent. Cubbie Group, which stretches over 96,000 hectares in southern Queensland, was placed into voluntary administration three years ago after financial difficulties brought on by years of harsh drought. Swan said a number of attempts had been made to find a buyer for the company and bring an end to a long period of uncertainty. The assessment by the Foreign Investment Review Board, necessary for any property sale price exceeding a threshold of Aus$244 million (US$251.5 million), had now given the green light to the proposal from RuYi -- which is owned by a consortium of investors in China and Japan -- and Lempriere. The Australian newspaper said Friday that the price would likely be under the Aus$300 million previously flagged, in part due to falling cotton prices. "The government welcomes foreign investment in Australia and continues to ensure that investments are consistent with Australia's national interest," Swan said in a statement.