Karen Andrews says it’s ‘concerning’ that Japan could look elsewhere after Queensland hiked mining royalties

A shadow minister has expressed concern that Japan could look elsewhere to invest after the Palaszczuk Government increased coal mining royalties – a move that could have “widespread effects”.

Shadow Home Affairs Minister Karen Andrews says it’s “very, very” concerning that Japan could be rethinking its economic relationship after the Queensland government hiked coal mining royalties.

In the state budget unveiled last month, the Palaszczuk government increased the royalty rate to 40 per cent for prices above $300 a tonne.

It also increased the rate to 30 per cent for prices above $225 a tonne and 20 per cent for prices above $175 a tonne.

This significant increase – from the previous top of 15 per cent – has raised concerns that global investment into the state could halt.

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Speaking at the University of Queensland, Japan’s Ambassador to Australia Shingo Yamagami said he’s worried about the “damage” that could be done to the relationship.

“What concerns me is the damage that it could deal to this trust and goodwill that Japanese business has built up with Queensland over the years,” he told the audience on Wednesday.

“I fear that this may have widespread effects on Japanese investment beyond the coal industry.

“The companies are involved not only with minerals but hydrogen infrastructure and a variety of cutting-edge technology.

“The success in the partnership between Japanese business and Queensland in these crucial areas is contingent upon the strength of mutual trust between both sides.”

Ms Andrews – who represents a Queensland electorate – said Japan reconsidering is an “awful” outcome for the state.

“The fact that the Japanese Ambassador was prepared to make such strong statements indicates the depth of their feeling,” Ms Andrews told Sky News Australia’s Peter Stefanovic.

“Australia has had a strong relationship with Japan. We want to maintain that relationship.

“The fact that there was, what seems to be, fairly unilateral action taken by the Queensland government to try and protect, preserve and improve its budget bottom line is really quite worrying in terms of the relationship that Australia has had with Japan.

“I think it’s very, very concerning.”

The federal Resources Minister, Madeleine King, said the decision is ultimately one for the state government but said she’s committed to working with international partners to “address current global challenges”.

“Australian energy resources, particularly LNG and, in the ­future, hydrogen, lithium and rare earths, will help our trading partners meet their net-zero ambitions,” Ms King said. “I look forward to continuing productive conversations with international counterparts at next week’s Sydney Energy Forum.”

Ms Andrews said she didn’t see the rhetoric from Japan as a threat but more as a “matter of fact” statement.

“He was being very clear what was likely to happen if Japan formed the view and Japanese companies formed the view that Queensland was a risk from an investment point of view,” she said.

“So I think he was making it very clear what the reaction was likely to be in Japan.

“They will look for safe investments and if that’s not Queensland, what he has flagged is that they will look elsewhere.

“I am worried about it.”