Claims that lease might pose national security concerns . . .
The Australian government confirmed on Monday that it is reviewing the 99-year lease of the Port of Darwin to the Landbridge Group, a Chinese company with close ties to the Chinese military. The review could result in the company being directed to divest from the port on national security grounds. The Northern Territory government and Landbridge signed the lease in 2015 for a deal worth C$487 million. In return, the Chinese company has operational control of the port as well as 80 per cent ownership over the land and facilities of East Arm wharf. At the time the deal was struck, however, then Defense Minister Dennis Richardson contended it posed no security concerns.
Escalating political tensions . . .
The investment review is just the latest episode in the escalating political tensions between Beijing and Canberra sparked after the Australian government’s call last year for an investigation into the origins of COVID-19. In December, the Australian government also passed the Foreign Relations Bill, which gives Canberra the power to tear up international agreements made by sub-national entities, including state and local governments, as well as universities. In April, the Australian government used these new-found powers to cancel the state of Victoria’s Belt and Road agreement with China.
Concerns over Chinese SOE activities echoed in Canada . . .
Many Western governments are, like Australia, concerned about foreign state-owned enterprise (SOE) investments. In particular, they worry that some SOE investments may be motivated by non-commercial imperatives, such as geostrategic goals, that threaten national and economic security. In Canada, the federal government issued a policy statement on its foreign investment review last April. Ottawa now screens all foreign investments by SOEs or investors with close ties to foreign governments, regardless of the value of those investments.
- The Age: ‘Strategic own goal’: Defense reviews Port of Darwin’s Chinese ownership
- Government of Canada: Guidelines on the National Security Review of Investments
- South China Morning Post: China-Australia relations: Ripping up Chinese firm’s Darwin Port Lease could cost Canberra