UPDATE: WARREN Truss says a leasehold will allay concerns about foreign development of irrigated food bowl land in WA's Kimberley region.
The lease to develop 15,200ha of irrigated agricultural land in Western Australia is due to be officially announced next week, but News Limited has reported the lease has gone to Chinese Property conglomerate Shanghai Zhongfu.
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State and federal governments spent $510 million building infrastructure to support the second stage expansion of the Ord irrigation scheme for food bowl farming, News Ltd said.
Western Australia Premier Colin Barnett said he would not reveal who has won the lease until next week.
Mr Barnett said the contract would not be announced until next week and refused to be baited by rumours.
He said stage two of the project involved $300 million from the WA government to extend the canal infrastructure, as well as $200 million in federal funding for social improvements including health and housing for Aboriginal people.
"Will governments get their money back? No, they will not," Mr Barnett said.
"But this is part of developing an agricultural industry in the north of the state.
"It's about improving the conditions for Aboriginal people, particularly giving large numbers jobs and economic independence, and basically it's about developing the north."
Deputy Prime Minister Wayne Swan told reporters today that it was a decision for the WA government.
"If it is going to progress, there may well be some application that may come to the Foreign Investment Review Board, but at the moment this is a decision by the West Australian government," he said.
A spokesman for West Australian regional development minister Brendon Grylls declined to comment on allegations Shanghai Zhongfu had been awarded the lease.
Federal Nationals Leader Warren Truss said he was not aware of the deal, which includes developing, farming and creating a sugar-mill on site had been given the go-ahead.
"It is my understanding the Western Australia government has not yet come to a decision as to who would be the preferred tenderer," Mr Truss said today.
However, concerns about foreign ownership would be allayed by the deal's leasing arrangement, he said.
"The fact that the land is to be leasehold will mitigate some of the concerns that Australians feel about the levels of foreign ownership."
Mr Truss said whoever the preferred tenderer, the deal would provide jobs, investment and community benefits.
Democratic Labor Party Senator John Madigan said "we have basically sold the rights of what could be the Riverina of the 21st century".
"The Ord river region has always been seen by the DLP as an area with the promise of a great future," Mr Madigan said.
"Unfortunately that future will no longer benefit the Australian people.
"It was an area that had the potential for great food development and international trade arrangement.
"The short-sighted successive governments of this country have sold off one of the greatest icons and development opportunities in this land to a foreign investor that has more vision towards the areas potential than any of the pork barrelling politicians of our major parties."
- With AAP