The political fight over Chinese trade and investment is set to intensify, with Labor accusing the Turnbull government of unfairly targeting Asians with its foreign investment crackdown.
Labor is set to oppose the government's plan to impose stricter controls on foreign investment in agricultural businesses, with one prominent NSW senator likening it to the White Australia policy.
Sam Dastyari said while there were a number of good measures in the government's draft laws – which the Senate is expected to consider this week – the agribusiness changes are xenophobic.
"There are measures in this bill that are dog-whistling designed simply to placate the most reprehensible elements in the National Party," Senator Dastyari told Fairfax Media on Saturday.
The changes include a $55 million screening threshold for direct non-government investments in agribusiness.
The threshold would apply to investors from all but three countries – the US, New Zealand and Chile. Australia's free-trade agreements with those countries mean investors will only need approval if acquiring a substantial interest in an agribusiness worth more than $1 billion.
But Senator Dastyari says that will create a two-tiered investment system and contends the measures are clearly aimed at Asian nations.
"It's just insulting that in the year 2015 we would be treating Chinese, Japanese and Korean investors differently than Americans," he said.
"Lets not pussyfoot around this - the measures we are seeing about Asian investment are designed to target Chinese agricultural investors. We evolved beyond a White Australia policy on immigration, I would suggest we need to do the same on investment."
The Coalition has in turn accused Labor of racism and xenophobia for raising concerns about the China-Australia free-trade agreement.
Prime Minister Malcolm Turnbull took up the theme on Saturday, saying Labor was "frightened of the future".
Signed in June, the deal still needs parliamentary approval but Labor says it will threaten jobs because it lets Chinese companies bring in workers without proper labour market testing.
Labor's move on the foreign investment laws will be seen by many as a way of hitting back at the government on the issue. Indeed, Senator Dastyari said it was "a bit rich" for the government to call Labor xenophobic one day and then introduce a bill "targeting Asian investors the next".
A Senate committee is due to report on the government's foreign investment legislation on Monday. Senator Dastyari wants the bill split so Labor can support what it regards as good elements but vote against the bad.
The government's legislation, introduced by former treasurer Joe Hockey in August, also cracks down on foreign investment in real estate and imposes tougher penalties for investors who break the rules. Labor voted for the package in its entirety in the lower house.
