Three ways Australia’s Darwin port decision could threaten future Chinese investment
- Overturning a commercial lease offers four courses of action, three of which are likely to aggravate China and affect views of investment risk in Australia
- The Morrison government looks set to act without proper consideration of the longer-term consequences for the country and its economy
“Will no one rid me of this troublesome priest?” King Henry II is said to have mused. A man of shallow moral character, Henry knew exactly what he was doing. Sure enough, four knights took it upon themselves to murder the Archbishop of Canterbury.
The result of the inquiry would seem to be a forgone conclusion. The real question is how that conclusion will be acted on, and that leads to broader questions about the status of investment security and the level of sovereign risk in Australia.
The most important strategic port in northern Australia has a sorry history. For years, the Northern Territory government tried to enlist federal government support to upgrade the facilities. It was largely unsuccessful and, in 2015, the port lease was put out to tender.
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Trade ‘only one part of the battle‘ in China-Australia dispute, says legal expert Bryan Mercurio
It was not until Chinese company Landbridge won the tender that the port suddenly became one of Australia’s most strategic assets. The chorus calling for the lease to be overturned has been constant, although there has been no matching refrain offering replacement funding for port development.