Australia says it will not cancel Darwin port lease to Chinese company after review
- The announcement the agreement would not be varied or axed comes ahead of Prime Minister Anthony Albanese’s expected visit to China this year
- The 99-year lease of the port to Landbridge came under scrutiny in 2021 as Australia boosted foreign investment screening
In a statement, the prime minister’s department said: “Australians can have confidence that their safety will not be compromised, while ensuring that Australia remains a competitive destination for foreign investment”.
It added that monitoring of security arrangements would continue around the northern port.
During a diplomatic dispute that is now easing, China had criticised Australia for blocking Chinese investment in infrastructure on national security grounds.
The 99-year lease of the commercial port to Landbridge was put under scrutiny in 2021 by the Australian government as it boosted foreign investment screening and introduced a national interest test for critical infrastructure.
Australia’s PM Anthony Albanese eyes end of China’s curbs on imports
After it won election in 2022, Prime Minister Anthony Albanese’s Labor government launched a second review of the lease, involving defence, foreign affairs and security agencies.
The announcement the lease would not be varied or cancelled comes ahead of Albanese’s visit to Washington next week, and ahead of an expected visit to China this year.
Landbridge won a bidding process in 2015 to operate the port in a deal worth A$506 million (US$390 million).
The awarding of the contract to Landbridge by the Northern Territory government came just a few years after the United States posted the first of a rotating group of US Marines in Darwin.
The size and scope of US military rotations through northern Australia, and the strategic importance of northern bases, has been boosted after an Australian defence review said in April China is undertaking the largest military build-up of any country since the end of World War II.
Australia to build new Darwin port after Chinese lease
Peter Dean, director of foreign policy and defence at the United States Studies Centre in Sydney, said it was likely the government would seek to build a second port in Darwin harbour or nearby for military use.
“Naval assessments have been saying they want a dedicated wharf on their own,” he said.
Dean, one of the authors of Australia’s Defence Strategic Review, said the port leased by Landbridge was physical infrastructure, so didn’t pose the same security risk as a power grid or 5G network, areas where China has previously been blocked from investment.
“Absolute worst case scenario, you just nationalise it and take it back. We need to find areas where we can collaborate with China,” he said.
Landbridge and Darwin Port said in a statement the decision “reaffirms our position that there is no basis for security concerns given the port is operated as a commercial enterprise in accordance with Australian law and the port transaction documents”.
Australia is pushing for China to lift trade blocks on its wine industry ahead of the Albanese visit, with a World Trade Organization ruling on the dispute imminent.
