Flat White

Doing business with China without retreating on national security

26 October 2017

6:00 PM

26 October 2017

6:00 PM

China is a one-party state led by Xi Jinping, whose powers look like growing to that of a modern Stalin, or at least Mao. In a zeitgeist of international turmoil, Australia needs to balance our commercial interests with our national security and democratic ethos. We don’t need endless op-eds adulating the new Xi cult of personality by every expert that’s ever flown over China.

Beijing’s increasing insolence is shown by their contempt for even the PR of continuing to show an interest in democratic values. As The Australian’s foreign editor Greg Sheridan points out;

You thought China valued human right? Wrong.

The depressing truth is that ruthless Xi Jinping no longer even pretends to care.

The Kissinger Institute on China and the United States reports that “In June 2017 the New York Times and The Economist featured stories on China’s political influence in Australia. The New York Times headline asked “Are Australia’s Politics too Easy to Corrupt?” while The Economist referred to China as the “Meddle Kingdom.” In Australia, these two articles were reacting to investigations by Fairfax Media and 4 Corners into the extent of China’s political interference in Australia. They built on internal enquiries into the same issue by ASIO and The Department of Prime Minister and Cabinet in 2015 and 2016. Both media and official reports concluded that Australia was the target of a foreign interference campaign by China “on a larger scale than that being carried out by any other nation”, that the Chinese Communist Party (CCP) was working to infiltrate Australian political and foreign affairs circles, as well to acquire influence over Australia’s Chinese population.”

Reported donations by individuals associated with Beijing-aligned business fronts such as the Australian Council for the Promotion of Peaceful Reunification of China (ACPPRC )have rightly caused widespread unease.

As a result of this reportage, demands for the barring of such foreign donations to Australian political parties and other such local institutions have become inevitable.

According to a Herald-Sun front page, these ACPPRC donations amounted to $6 million over the last five years. Of course, it’s unfair to conflate our Australian-Chinese citizens with China as a state. Yet the head of the APPRC, Huang Xiangmo, not yet a citizen, withdrew $400,000 from the Opposition when it failed to agree that Labor not oppose Xi Jinping’s militarisation of the South China Sea. Fear mongering about ‘prospective’ economic damage to Australian trade or investment by China must not deter us from a clear-eyed opposition to Beijing’s many interventions in our country, such as Beijing’s decision to buy control of all the local Chinese language press.


The Foreign Investment Review Board (FIRB) reports that in the 2010-2011 to 2015-2016 financial years there was $169 billion of investment into Australia by individuals and entities from China. Investment has risen from $16.91billion in FY 2010-2011 to $47.3 billion in FY 2015-2016. There are obvious pitfalls with such huge investments from a single nation. Some years ago Australia’s then communications minister, Malcolm Turnbull, created tumult when he proposed that China’s telecommunication giant, Huawei, bid for the NBN, Australia’s future telecommunications spine. Australian agencies feared a Huawei- engineered technological “back door” to Australian communications and Turnbull’s dangerous proposal was dropped. Then a myopic Northern Territory government sold a 100-year lease on the Port of Darwin to Beijing interests for a mere $500 million. After that national “own goal”, non-partisan determination emerged in Canberra that the Foreign Investment Review Board (FIRB) should have stricter oversight over dual strategic/commercial investments by China. Soon after, former ASIO Director-General David Irvine was appointed to the FIRB and, shortly after that, a Beijing-based investment in AUSGRID, Australia’s largest electrical network and owned by the government of NSW, was barred by the FIRB. Yet when a proper balance is maintained between economic benefit and sovereignty, and a China government interest sought a 25 per cent interest in the successful bid of $9.7 billion for a 50-year lease of Port of Melbourne, no one, including The FIRB demurred.

Investors and traders from China are not being treated unfairly or being scapegoated. Far from it. They are being judged on Australia’s commercial and national interests, the same as all other investors.

So, if this $169 billion investment in Australia by China is “the big picture,” it certainly debunks the alarmism of comrades Drysdale and Denton that “opportunities are being squandered if Australian policy towards China is bungled”. Advocates of special treatment of China are going overboard when they cast doubts on the responsible exercise of Australian security and foreign policy. Yes, we must ignore the xenophobic appeals against any investment in Australia by China. With $169 billon of traceable investment from China, we can hardly be seen as suppressing their entrepreneurial spirit.

Even before, the Secretary of DFAT Frances Adamson put this issue on the front page, China advocates, academic Drysdale and legal gun Denton worried that “recent coverage of Chinese influence in Australia carries the implication that the entire Australian –Chinese community is a ‘dagger’ pointed at the heart of Australian democracy. If this is the case then the insinuation needs to be remedied immediately”.

Professor John Fitzgerald in a three-page AFR article headlined “Red Pen On Academic Freedom” argued that: “Universities jeopardise intellectual integrity when they collaborate with Chinese institutions that do not share a commitment to liberal values and open inquiry”.

There are now 14 Confucius institutes in Australian universities, together with the pro-Beijing foreign policy think-tank Australia China Relations Institute (ACRI) University of Technology-Sydney. It’s hardly McCarthyism to point out that ACPPRC and organisations like it are closely aligned with the United Front Work Department (UFWD) of the China Central Committee of the Communist Party.

When comrades Drysdale and Denton protest that China is the “upholder of an international rules-based order” they appear like the Admiral Lord Nelson with his blind eye to the telescope. It is Beijing which flouts international law, sought by ASEAN to stop China’s domination of the South China Sea, where 60 per cent of Australia’s maritime trade transits. Parliament’s Joint Select Committee on Electoral Matters is set to recommend, and federal Parliament will endorse, a ban on foreign donations to political parties. Also, I predict the FIRB will prevent future imbroglios like the sale of the Port of Darwin. Most importantly, Beijing’s political interference via its local arms of the United Front Department in universities, think-tanks, and parties will be subject to media and parliamentary scrutiny.

The nervous nellies who advocate a “hands off” policy for investments from China should be reassured that commercial arrangements will continue to prosper. However pro-Beijing academic and business interests should never override Australia’s national security, firmly rooted in the ANZUS alliance and our deeply democratic values.

Michael Danby is Member for Melbourne Ports.

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