Chinese Fifth Column

Australia's crackdown on Chinese influence is welcome, but merely a start
The Age

The Coalition government's proposed crackdown on Chinese manipulation of Australian public policy is welcome, if overdue, but its efficacy will be determined by details yet to be revealed, and it falls far short of the political donations reforms required to buttress public confidence in our democracy.
Democracy depends on transparency and accountability -- a carefully calibrated system of checks and balances that punish and deter undue influence, without placing undue shackles on political freedom and access to public debate. 

The Age has long advocated comprehensive changes to political funding. 

We cautiously endorse the mooted move to outlaw Chinese political donations and to create a public register of individuals and organisations representing the interests of Chinese government and corporations.
Beijing's stooge Sam Dastyari.

But the public will not have robust faith in the system until changes apparently excluded from the pending legislation are established. 

These include: real-time public disclosure of donations; a cut in the disclosure threshold from $13,200 to $1000; capped donations from individuals, corporations and lobbyists; ending unions' compulsory donations to the ALP; and capping spending by parties. 

To compensate for blocking murky private money, public funding should be augmented. 

Further, Australia clearly needs a national anti-corruption commission, with full judicial powers.
Contemporary politics is replete with examples of opaque influence-seeking. 

Labor Senator Sam Dastyari's complicity with Chinese interests is egregious to the point of disgraceful, and he arguably should resign from Parliament. 

Bought by China: Andrew Robb

Former Liberal Party trade minister Andrew Robb's $880,000 annual stipend from the Chinese-government linked company that bought the port of Darwin is also unseemly. 

His protestations that he is being unfairly labelled does not stand scrutiny. 

The proposed legislation would require him to register as a Chinese agent. 

Should he have nothing to hide, he should have no fear of transparency.
Senator Dastyari's behaviour, which included seeking and receiving Chinese money to cover personal expenses, while he advocated, in conflict with his own party's policy, for China's aggressive expansionism in the South China Sea, would, according to Attorney-General George Brandis, contravene the proposed law. 

The Senator's warning to a Chinese donor about likely surveillance by Australia's security forces beggars belief. 

The Liberal Party's receipt of hundreds of thousands of dollars from interests linked to the Chinese government is also evidence of the need to clean up political funding.
But it's not just Chinese influence that needs curbing. 

Former Liberal small business minister Bruce Billson's astounding failure to declare he was being paid by the $170-billion franchise industry's lobby group while still in federal parliament is appalling. Lobbyists are paid to influence lawmakers to tilt legislation in favour of the profitability of companies and/or the political power of foreign governments. 

We need to examine whether the legislation has loopholes – for example, allowing Chinese entities to funnel money via locally registered organisations – or goes too far by, say, preventing charities from participating in public policy debate. 

The law, should it pass, will inevitably be tested in the courts – one of the fundamental checks and balances of our democracy.

Australia's Chinese Fifth Column

Australia's Remote Darwin Courts China Even With U.S. Marines
By Tom Westbrook

Diners sit at a waterside restaurant in Darwin, northern Australia, April 20, 2017. 

DARWIN -- When the United States signed an agreement in 2011 to use Australia's tropical port of Darwin as a base for military exercises, it was viewed as a key focus of former President Barack Obama's strategic pivot to Asia.
But when ammunition and equipment arrives in June for war games between U.S. and Australian forces in tropical Darwin, it will come ashore at the town's Chinese-run port under the eyes of a firm said to have links with China's military.
China, and not the United States, is fast becoming long-neglected Darwin's best hope for rejuvenating a city, named after the 19th-century naturalist Charles Darwin and better known for its monster crocodiles and giant beers.
"I can feel that we are definitely on the cusp of another great leap in our economic growth," said Darwin's Lord Mayor, Katrina Fong Lim, whose ancestors emigrated along with thousands of other Chinese migrants in the 1860s, lured by the discovery of gold.
"You just need to have a look around you to look at the investment that's coming in," she said in an interview.
Touted as Australia's front door to Asian markets, and a potential hub for resources and agriculture exports, Darwin is the centerpiece of a A$5 billion ($3.76 billion) government loans scheme aimed at developing the continent's north.
China wants to include Darwin, located closer to Indonesia's capital Jakarta than it is to Canberra, in its ambitious One Belt One Road project and the local government has grand plans to attract big-spending Chinese tourists.

MILITARY VS NEW MASTERS
"The Chinese are walking the talk," Port of Darwin Chief Executive Terry O'Connor told Reuters, as three camouflage-painted Blackhawk helicopters flew low over the harbor on the April afternoon when a contingent of Marines landed for a regular six-month rotation of forces.
"The Chinese are saying there's an opportunity and they're investing behind it," said O'Connor.
Darwin has hosted a contingent of 1,250 Marines since 2011, part of former President Barack Obama’s strategic pivot to Asia to counter a rising China.
It is due to grow to 2,500 by 2020.
Australia’s decision to allow China's Landbridge Group Co to secure a 99-year lease over the strategically important Port of Darwin raised some eyebrows in the United States.
The port is the southern flank of U.S. operations in the Pacific.
O'Connor insisted there is "no evidence" of military involvement and the port is "purely a commercial operation".
Landbridge, a petrochemical and port logistics firm, did not respond to requests for comment.
Chinese fifth column in Australia, on the other hand, questions the tight military relationship with the United States – it has fought alongside America in all its conflicts since World War One – when China has emerged as Australia’s most important trading partner.

BIG PLANS
Landbridge plans to add capacity to the cruise ship terminal and to build a luxury hotel on the waterfront.
Other projects on the drawing board include everything from soybeans and prawn farms, to frozen beef exports and a huge phosphate mine, along with new government-funded roads and rail lines to link them.
But for all the talk, there's as yet little action in Darwin.
None of the federal government's promised loans for infrastructure have been disbursed.
"Two years down the track you'll probably see the same," Kim Ly told Reuters, as she served just four diners at her wharf fish and chip shop.
"We came here, we worked hard, we saved up, we bought a business. But that was before. Now it is very hard."
The city's population has stalled short of 150,000 -- about half a percent of Australian's total -- and is seen falling next year.
Low unemployment of 3.5 percent and strong headline growth figures, boosted by multi-billion dollar gas projects from Inpex and Royal Dutch Shell, mask a weak underlying economy projected to shrink further.
Visitor numbers are officially forecast to be lower than they were a decade ago, and they will spend 300 fewer hotel nights in the Northern Territory this year than they did in 2007.
Throughput at the wharves is down and the main shopping mall is filled with 'for lease' signs.
Short-term apartment rentals, favored by the resource industry's fly-in-fly-out workers, lie empty.

OUTBACK MINES
The top exports from Darwin are manganese, bound for Malaysia, and live cattle, destined for Indonesia.
But piles of iron ore that once waited for export have vanished, the workers who brought it there are gone with it and the outback mines whence it came have shut since commodity prices began to fall in 2014.
Inpex and Shell's major LNG projects, which are tipped to have reserves to last a generation, are beset by delays and cost overruns.
Despite plans to extend the quay line and reclaim more land, investment at the port so far amounts to A$15 million spent on extending asphalted areas, a new pilot boat, and a yard for refrigerated containers.
Major highways in the Northern Territory remain unsealed and often impassable when it rains.
Lonely Planet named Darwin one of the top 10 cities in the world to visit in 2012, citing its vibrant night life, sunset beaches and proximity to several national parks.
Some visitors, however, were unimpressed.
Sharice Sun, a 29-year-old from Xi'an in China on a working holiday was headed for the library on her day off for lack of anything better to do.
Her verdict: "It's too hot, it's small and boring."

Australia rejects China push on Silk Road strategy

Canberra fears tying infrastructure fund to Beijing’s plans would hit US relations 
By Jamie Smyth in Sydney

Australian Prime Minister Malcolm Turnbull reviews a military honour guard with Chinese Premier Li Keqiang in Beijing last year.
Australia has rejected a Chinese push for a formal alignment of Canberra’s A$5bn state infrastructure fund with Beijing’s New Silk Road strategy, over concerns it could damage relations with the US at a time when it is asking Washington to do more in the region.
The Chinese initiative, also known as One Belt One Road, envisages investing $4tn in port, road and rail projects overseas — and Beijing has been pressing Asia-Pacific economies to sign up to its vision.
But Canberra has confirmed there will be no agreement over Australia’s Northern Development Infrastructure Facility during a trip to Australia this week by Li Keqiang.
“No formal memorandum on this issue will be signed during the visit,” said one Australian official speaking on condition of anonymity.
Li’s trip comes at a tricky time in Sino-Australian relations.
Canberra is pressing Washington to bolster its presence in the region and taking a tougher line on inward investment from China, recently blocking two high-profile takeovers.
Last week Julie Bishop, Australia’s foreign minister, called on the administration of Donald Trump to expand the US role in Asia to ensure stability and peace.
“While non-democracies such as China can thrive when participating in the present system, an essential pillar of our preferred order is democratic community,” she said in a speech in Singapore.
The debate over whether Australia should align its state infrastructure fund with One Belt One Road bears similarities to Canberra’s hesitation over joining the Asian Infrastructure Investment Bank.
In 2014 Australia initially decided not to join the Chinese-led multilateral lender following lobbying by the US and Japan.
But when the UK and several other western nations broke ranks and signed up to the AIIB, Canberra joined them.
“There is a view in the defence/security community in Canberra that initiatives like the AIIB and One Belt One Road are a way to extend Chinese influence at the expense of the US,” said Geoff Raby, a former Australian ambassador to China, who runs a consultancy advising Chinese and Australian businesses.

Li Keqiang’s Australian agenda 
● Beijing is pressing Canberra to ratify an extradition treaty that would enable it to target corrupt officials that have fled to Australia following Xi Jinping’s crackdown on corruption at home. 
● Canberra is likely to raise the cases of 14 employees of Crown Resorts — the gaming company controlled by Australian billionaire James Packer — who remain in detention in China following their arrest in October. 
● Both countries are working to tackle technical issues that have hampered the free flow of goods between the two. Australian beef producers are seeking greater access to the Chinese market. 

Mr Raby said Australia-China relations had “gone adrift”, with Canberra increasingly taking an idealist approach to relations focused on values, rather than a more greedy approach aimed at boosting economic ties with its largest trading partner.
Australian companies have expressed an interest in getting involved in the New Silk Road plan and business leaders in the country have set up a One Belt One Road advisory group to facilitate this. Government officials in the Northern Territory have also sought to align the region with China’s plans, describing official Chinese overtures first made by Xi Jinping on a visit to Australia in 2014 as a great opportunity for Darwin as a hub servicing the New Silk Road.
But Chinese assertiveness in the South China Sea, where it has laid claim to a vital trade route and lucrative fisheries area, has made Australia wary of its regional ambitions.
Canberra recently tightened scrutiny of foreign takeovers following the purchase of Darwin port by the Chinese company Landbridge — a transaction that alarmed Washington because of the nearby presence of a US army base.
Hugh White, professor of strategic studies at Australian National University, said Australia did not want to be left out of the Asian infrastructure network promised by One Belt One Road but nor did it want to be seen to be jumping on Beijing’s bandwagon too enthusiastically.
“Like everything else in Asia these days, OBOR has become a political and strategic symbol in the great contest between Washington and Beijing for regional leadership,” he said.
Shi Yinhong, professor of international relations at Remin University in Beijing, said port investments were by far the most sensitive direct investment by China in Australia.
“Obviously, there is a security concern over the ports,” he said.
“And on the Maritime Silk Road project, Australia has been hesitant because of a fundamental disagreement over the South China Sea.”

Chinese Peril

China snubbed on road and port push

By PRIMROSE RIORDAN

The Turnbull government is set to rebuff Xi Jinping’s calls to align Australia’s $5 billion Northern Australia Infrastructure Facility with a massive Chinese ­investment program in ports and roads that is being rolled out around the world.
Senior government sources say that while China was keen to ­officially link the facility with the Chinese infrastructure program known as the One Belt, One Road initiative, “we won’t be formalising any ­linkage”.
The news comes ahead of Li Keqiang’s visit to Sydney and Canberra from Wednesday.
Xi Jinping called for the alignment of the ­initiative with Australia’s northern development plan when he met Malcolm Turnbull last year.
The Belt Road Initiative aims to partner with foreign government and companies to channel trillions of dollars into ports, roads and other major infrastructure worldwide to counter the country’s maritime vulnerabilities.
Defence experts say it could create a China-led bloc to counter the US.
Chinese media reported earlier this month that the country had signed contracts worth more than $126bn with 61 countries.
The Australian reluctance to align its plans with those of the Chinese comes as the northern Australia development plan is set to gather momentum.
Minister for Resources and Northern Australia Matt Canavan said five projects to be funded under the facility were “close to ­financial close”.
Washington rebuked Canberra in late 2015 for allowing the former Northern Territory govern­ment to lease the Port of Darwin, which is a hub for rotating US marines, to Chinese firm Landbridge, whose head, Ye Cheng, has previously said the company’s ­investment in the Northern Territory port helped serve the Belt Road Initiative’s strategic and foreign policy goals.
The Australian government has pursued investment for Australian firms through the initiative, also known as the “Maritime Silk Road” or the “One Belt, One Road”, but was finding it hard to pin down how the scheme worked.
The source pointed to the fact that the Northern Australia Infrastructure Facility had a specific contact point, sum of funds and application process, which they said was somewhat “elusive” with the Belt Road Initiative.
Australian business favours the initiative, with Asciano chairman Malcolm Broomhead helping set up an advisory group to assist Australian industry to reap rewards from any potential investments, and the Australia-China Business Council urging Australia to get ­involved early to shape its rules.
Stephen FitzGerald, Australia’s first ambassador to China, said the initiative was going to be a “major influence in world affairs” and in our region.
He agreed Australia needed to be involved in order to try to influence and understand it as countries in Australia’s orbit were already receiving funds through the initiative. 

Mr FitzGerald also said there were financial reasons Australia should be involved.
In March, India announced it was opposed to the initiative since the China-Pakistan Economic Corridor, which China is building to connect the Gwadar Port in southwestern Pakistan with Xinjiang in far-western China, passes through India.
The hallmark European project of the initiative, the Belgrade to Budapest high-speed rail line, faces a Brussels-led investigation.

The Land at Stake Is in Australia, but the Focus Is on China

By MICHELLE INNIS

Herding cattle in Queensland, Australia. A recent poll found 87 percent of citizens were against foreigners owning Australian farms and 59 percent did not approve of Chinese investment. 

SYDNEY — Gina Rinehart is very rich — and very Australian.
The mining magnate’s ancestors immigrated to the country’s hardscrabble western reaches in the 1830s. 

A mountain range there is named after her family. 

In public she sometimes adopts a characteristically Australian distaste for pretension — what one historian called the country’s “democracy of manners” — such as the time she climbed onto the back of a flatbed truck with a bullhorn to excoriate a mining tax.
On Friday Ms. Rinehart added further to her local bona fides as she became the sole remaining bidder for iconic Australian grazing land bigger than Portugal. 

But her apparent victory will probably add to unease among some Australian leaders over a major foreign buyer: Her partners in the bid are from China.
Australia already depends heavily on China’s vast appetite for its rocks, milk and meat. 

Now it is soaking up billions of dollars’ worth of investment from China, with the total reaching $11.1 billion last year, according to KPMG, the consulting firm. 

That has led to worries among members of the public that Chinese investors are buying up significant parts of the Australian economy and driving up already hefty home prices.
While critics of that stance say fears of China buying crucial Australian assets are largely unfounded, some Australian leaders have begun to act.
The Australian government in August blocked a joint bid by a Chinese and a Hong Kong company for Ausgrid, an electricity company and one of Australia’s largest infrastructure assets, with Scott Morrison, Australia’s treasurer, saying such a deal would be “contrary to the national interest.” Instead the government approved giving majority control of Ausgrid to two Australian pension funds in a $12.3 billion lease deal that valued the company at less than what the earlier bidders had offered.
The government also weathered the furor caused when the local authorities leased part of the port in the Australian city of Darwin to a Chinese company. 

United States Marines rotate through Darwin for joint military exercises as part of the Obama administration’s pivot toward the region.
Steve Ciobo, the trade minister, said in September that the government would consider updating its foreign investment guidelines so Australians could be sure that proposed investments were “good for the country.” 

Mike Smith, the former chief executive of Australia & New Zealand Banking Group, a major lender, went further. 

On Monday, he said Australia should make a list of “no-go assets.”
On Friday, four big Australian landowners withdrew a joint offer to buy S. Kidman & Company, which controls more than 38,600 square miles of land, after a group led by Ms. Rinehart topped their offer with a $294 million bid on Thursday.
Before their retreat, the landowners criticized Ms. Rinehart’s bid as not Australian enough. 

While Ms. Rinehart controls the group bidding for Kidman, the Chinese property company Shanghai CRED owns a one-third stake.
The bid from the landowners did not rely on “getting money out of the People’s Republic of China,” said Sterling Buntine, one of the landowners, in comments that came days before his group bowed out. 

Instead, he told lawmakers, it “will see Kidman 100 percent Australian-owned.”
The Kidman properties account for 2.5 percent of Australia’s farmland and include a pastoral lease across a weapons range classified as sensitive by the Australian government.
The Rinehart group’s bid excludes the areas abutting the weapons range.

The mining magnate Gina Rinehart in 2015. A group led by Ms. Rinehart bid $294 million to buy S. Kidman & Company, owners of more than 38,600 square miles of land. 

Mr. Morrison, the treasurer, had already rejected bids for Kidman from two Chinese companies. When Ms. Rinehart emerged with her Chinese partner, Mr. Buntine and his fellow cattle ranchers quickly countered.
“My father carted cattle for Kidman for many years,” Mr. Buntine said. 

Other consortium members, the Oldfield family and the Brinkworths, were cattlemen on Kidman properties or drovers. 

Malcolm Harris, the fourth member, runs cattle farms in Western Australia and the Northern Territory.
Ms. Rinehart’s camp dismissed the idea that the presence of a Chinese partner would take valuable Australian land out of the hands of locals.
“You don’t get much more Australian than fourth-generation Australian Gina Rinehart,” said Garry Korte, the chief executive of Hancock Prospecting, Ms. Rinehart’s investment vehicle.
Shanghai CRED did not respond to requests for comment.
Ms. Rinehart, who is well known in Australia for her strong conservative political views and legal fights with other members of her family, has stressed her connections to the Kidman properties. 

Her grandfather, she says, ran several businesses with the properties’ late owner, Sidney Kidman. “They respected each other and were friends,” she said.
In a poll before national elections, which were held on July 2, the Lowy Institute, an independent research center, found that 87 percent of Australians were against foreigners owning Australian farms and that 59 percent did not approve of Chinese investment.
“Most Australians have little or no direct connection with Kidman,” said Simon Venus, a lawyer acting for the landowners. 

“But culturally, it is very significant. There’s a romantic nostalgia around the properties.”
So far Chinese investors hold only modest amounts of Australian land. 

Investors from the United Kingdom are the largest foreign holders, with 27.5 million hectares, followed by those from the United States, according to Australian trade officials. 

Investors from China ranked fifth, holding 1.5 million hectares.
Critics of the growing anti-China stance from some politicians say it amounts to pandering. 

Indeed, many Australians believe homeownership is out of their reach because Chinese investors are pushing prices higher.
“The process for the sale of big-ticket assets is utterly politicized,” said Jeffrey Wilson of the Asia Research Center at Murdoch University in Perth.
But the government is grappling with rising discontent among junior and independent lawmakers who are uneasy about foreign investment. 

Two lawmakers, Nick Xenophon, a senator from South Australia, and Bob Katter, a lower-house lawmaker from Queensland, said on Monday that the government should stiffen the rules governing the entry of foreign buyers.
Mr. Xenophon said he supported foreign investment but was considering pressing for new laws that would give tax breaks to Australian pension funds to help them buy Australian assets. 

“It means profits stay here, jobs are created here,” he said.