Review of foreign purchases vital, no matter financial cost

(First published in The Mercury 5 May 2021)

Many of us felt extremely uncomfortable with the Port of Darwin being leased to Chinese interests for 99 years. We were right to feel uncomfortable. Very uncomfortable.

In 2015, the Port of Darwin was leased to Landbridge Industry Australia, a subsidiary of Shandong Landbridge Group, a Chinese company whose billionaire owner Ye Cheng was named by the Chinese Government in 2013 as one of the top 10 “individuals caring about the development of national defence”. Shortly after the purchase of the lease Cheng tellingly, if perhaps, accidentally, told state-owned news organ Xinhua News Agency that “Landbridge has a port in Rizhao [eastern China] and now we have a port in Darwin. This is our involvement in One Belt, One Road." If that wasn’t enough, the company was later found to have extensive links to the CCP and the People’s Liberation Army.

At the time, the Department of Defence “examined the possible security implications” of the lease of the port but did not have any concerns. Former Secretary of the Department of Defence, Dennis Richardson, unbelievably told Senate Estimates on 21 October 2015 that “no part of defence had a concern from a security perspective in the respect of the sale.”

The announcement of the lease was not without criticism from security experts. Neil James, executive director of the Australia Defence Association, wrote that “there has been an utter failure to examine the matter in a mature, holistic and grand-strategic context that draws together all the Australian (and allied) sovereign-freedom-of-action implications over the next century.” Peter Jennings, executive director of the Australian Strategic Policy Institute, said that “the Port of Darwin debacle should force reconsideration of how Australia deals with the national security implications of foreign direct investment proposals.”

The announcement of a review into the Port of Darwin is, therefore, an overdue and vital step in maintaining the integrity of Australia’s critical infrastructure, and protection from possible foreign economic and military interference.

The purchase of the Port of Darwin is not an isolated investment decision but a deliberate, calculated purchase as part of a larger plan by the CCP to expand its economic reach through a network of global maritime hubs known as the “the 21st century Maritime Silk Road”, which in turn is part of the larger and more well-known global Belt and Road Initiative. The CCP has a consistent record of buying ports in vital shipping areas and using its economic leverage to extract military and strategic advantages.             

The Port of Piraeus in Greece China’s main gateway to Europe and in 2010, the China Ocean Shipping Co., known as COSCO, started buying stakes in the port. Just six years later, COSCO had full control of the port. China now holds stakes in over a dozen European ports.

Hambantota Port in Sri Lanka, close to one of the world’s busiest shipping lanes, was ceded to the Chinese Government in 2018 – along with 15,000 acres of surrounding land – for 99 years. Sri Lanka’s president turned to the Chinese Government for loans and help to build the project only to incur such crippling debt as to offload the entire port, giving China an economically and militarily important territory, and one only a few hundred miles from India, their rival and fellow emerging superpower.     

The Port of Djibouti is now buttressed by China’s first overseas military base (known as its “strategic strongpoint”, in Beijing). Less than two weeks ago U.S. General Stephen Townsend warned that “the Chinese base is turning into a ‘platform to project power across the continent and its waters’” and that China is “looking for other basing opportunities (around Africa)”. Unsurprisingly, the Port of Djibouti is strategically located at the crossroads of one of the busiest shipping lanes routes in the world, linking the Persian Gulf, Europe, the Far East, and the Horn of Africa.

Another Australian port, as part of China’s massive investment push into Victoria, was also in China’s sights. Victoria’s China Strategy Progress Report 2018 outlined how the China Investment Corporation – a state-owned investment fund – had joined the Lonsdale Consortium to purchase 20 per cent of the 50-year-long Port of Melbourne lease.

The CCP has never allowed a foreign nation to interfere with its ‘internal affairs’ with the purchase of maritime infrastructure that is so militarily, economically, and strategically important, yet the Darwin Port lease was inexplicably believed to be in the nation’s interest.   

Australia faces unprecedented levels of foreign interference aimed at undermining our political system, critical infrastructure and social institutions. Given the new powers of the Federal Government under the Foreign Relations Bill, it is a timely and appropriate decision from Minister Dutton to review all investments and the purchase of critical assets by foreign nations which have the potential to subvert our national interests and security – no matter the financial cost.

About Eric

Eric Abetz has been a Liberal Senator for Tasmania since 1994 and has served in a range of Leadership, Ministerial and Shadow Ministerial roles.

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