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New data from the Australian National University (ANU) shows Chinese investment in Australia plunged by 61 per cent in 2020 to hit a new low.
This follows a 47 per cent drop in 2019, and is the lowest number recorded over the past six years.
ANU's Chinese Investment in Australia Data Base (CHIIA) recorded just over $1 billion of investment in 2020, down from $2.6 billion the year below.
It falls far short from the peak of $16.5 billion invested by China in 2016.
Director of the East Asian Bureau of Economic Research Dr Shiro Armstrong said the data demonstrated a pattern that intensified in 2019 when 92 per cent of new Chinese investment was sourced from within Australia.
"In 2020, the year of COVID-19, foreign direct investment fell globally by 42 per cent according to the United Nations," Armstrong said.
"It reflects the effects of COVID but also more scrutiny of foreign investment by the Australian government, particularly that from China.
"The United Nations reports that total foreign investment to Australia fell by 46 per cent, whereas foreign investment to Japan, China, India and some developed countries such as Sweden and Spain rose while investment to the United States and the United Kingdom plummeted."
The number of Chinese investments recorded was only 20, well down from a peak of 111 investment projects in 2016.
In 2020, 86 per cent of Chinese investment in Australia originated from Chinese companies already established within Australia, meaning purchases were made via Australian subsidiaries rather than by foreign firms directly.
Data has been collected by CHIIA since 2014, and during that period almost every sector of the Australian economy saw Chinese investment activity.
However, in 2020, Chinese investment was limited to just three sectors: real estate ($416 million), mining ($414 million), and manufacturing ($153 million).
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