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The Australian Department of Defense is reviewing whether to undo a controversial lease to a Chinese company in the port of Darwin, which is close to a U.S. naval base.
Washington has long expressed concern the 99-year lease, which was sold by the Northern Territory government in Landbridge based in Shandong for $ 506 million in 2015.
The revision was announced after a sharp deterioration in Australia-China ties, prompting Canberra to do so. splinter, chop last week, two Belt and Road Initiative agreements between the Chinese and Victorian state governments.
Peter Dutton, Australia’s defense minister, confirmed on Monday the review of the lease in an interview with the Sydney Morning Herald, saying he had asked his department to “come back with some advice” to ensure the government could ” to examine the options that exist in our country’s interests ”.
New legislation has given Canberra “last resort” powers to act retrospectively to force companies to disintegrate assets when national security risks arise.
But experts said any action against a Chinese private company would be controversial, as it could provoke retaliation against Australian companies by Beijing. It would also overturn the previous advice from the Australian Department of Defense that the port agreement posed no threat to security.
“Australia’s defense and security agencies were unanimous in 2015 that the deal posed no national security risk,” James Laurenceson told the University of Technology Sydney.
He said the assessment did not change in 2018, according to comments from Julie Bishop, then Australian Foreign Minister. And despite the public agitation of Chinese hawks in recent months, the government had not received any advice on possible security risks, Laurenceson added.
Last week, Dutton warned that “the conflict with China over Taiwan should not be ruled out,” prompting Beijing to warn Canberra to stop interfering in its internal affairs.
Scott Morrison, Australian Prime Minister, said that if he received advice suggesting there were risks, the government would take action.
When Landbridge bought the lease, Ye Cheng, the company’s founder, suggested the port would be part of Beijing’s BRI plan, a central element of President Xi Jinping’s foreign policy.
Mike Hughes, vice president of Landbridge Australia, told the Financial Times that the company knew about the review and was willing to participate.
The deal was initially approved without too much scrutiny in Canberra, which had recently signed a free trade agreement with Beijing. But US-China tensions over China’s aggressive expansion into the disputed South China Sea have prompted Barack Obama to step up. concerns directly with Malcolm Turnbull, then Prime Minister, for not being consulted on the deal.
Since then, Canberra has banned Huawei from its 5G network, tightened foreign investment rules and blocked the sale of various assets to Chinese bidders. Beijing has accused Canberra of unfairly targeting its interests and has dealt trade sanctions against several Australian products.
Peter Jennings, director of the Australian Strategic Policy Institute, who has done so campaigned against allowing Landbridge to withhold the lease, he said there had been a change in strategic circumstances since 2015.
“China is pursuing a policy of coercion to try to get states to behave in a way that suits Beijing. The obvious question to ask is: how comfortable can we be for Chinese companies to have key elements of infrastructure? criticism of Australia? ”
Jennings said the government should review Chinese or Hong Kong ownership of other important assets, including power grids and port infrastructure in New South Wales and gas pipelines in Western Australia.
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