Scott Morrison pulls the plug on China Ausgrid deal
Scott Morrison has not only defied Beijing, but Superman himself. The treasurer’s provisional blocking of a Chinese state corporation’s bid for the New South Wales electricity network Ausgrid was surprisingly extended to Hong Kong plutocrat Li Ka-shing who, while he doesn’t wear his underpants on the outside, earned the moniker for his near superhuman ability to make money.
Li’s been cashing in for years as our states sell off assets, his Cheung Kong Infrastructure group now controlling networks supplying electricity to about two million customers in Victoria and South Australia (including the RAAF Woomera Test Range), and gas around most of the eastern states.
Suddenly, when it comes to owning 50.4 per cent of NSW poles and wires, Li is a national security risk, alongside the rival bidder, China’s State Grid Corporation, which only last year was being waved in by the Foreign Investment Review Board (FIRB) to stakes in other Victorian, NSW and SA power and gas utilities. Both State Grid and Cheung Kong Infrastructure had been cleared by the FIRB to bid for the larger NSW power network TransGrid, which eventually went to a consortium led by a Westpac subsidiary with Middle Eastern and Canadian partners.
Morrison is suitably Delphic when asked to explain his decision. “The only person who’s security-cleared in this room to be able to hear the answer to that question is me,” he said. This extends to the bidders. Graciously he gave them a week to assuage his concerns, but they won’t be told what they are. “The issues of Australia’s national security are only disclosed to those who are in a position to be cleared for that purpose,” he said.
So what are the clues? Morrison said risks “were identified in critical power and communications services that Ausgrid provides to businesses and governments”. These were not important in the other networks with existing investments by the bidders. “The issue here is very much about the asset itself and the structure of the ownership and the control of that asset,” he intoned to the ABCs Michael Brissenden.
Even sympathetic shock jock Ray Hadley couldn’t get him to spill the beans. With the earlier TransGrid sale, ScoMo had insisted on personnel in critical network positions having security clearances, and control remaining within Australia under a board quorum of Australian citizens. “These were the toughest sanctions ever put in place for TransGrid and other like transactions, and even that was not enough in our view to mitigate the real risk we had on this [the Ausgrid] sale,” he assured Hadley.
Golly. Previously we’d thought that TransGrid was the worry, providing the juice for military Führerbunkers at Sydney’s Garden Island and Bungendore and the code-cracking supercomputers at Russell Hill, while Ausgrid more humbly supplied households and small businesses in Sydney suburbs, the NSW Central Coast and the Hunter Valley. If so, ScoMo has prevented China’s Ministry of State Security installing sleeper agents poised to throw a barbecue-stopping switch. But why spend billions to achieve, possibly, what a bit of hacking might do better?
Of course it may just have to do with the timing. Ausgrid’s selloff comes after Canberra got a bollocking from Washington about the lease of Darwin’s port to a Chinese outfit, and after a close election when economic nationalism came to the fore on the Coalition’s right flank. Malcolm Turnbull will have an interesting conversation in Vientiane with China’s Li Keqiang just under three weeks from now.
Li Ka-shing has been among the most “patriotic” of Hong Kong’s tycoons, but he’s recently been getting stuck into Beijing’s official media for not being patriotic enough. So now his son and heir apparent Richard Li is doing his bit to quell restive elements in the special autonomous region.
At the beginning of the month, Li jnr’s Hong Kong Economic Journal suspended a widely read regular column by Joseph Lian Yi-zheng, a former chief editor of the business newspaper, who frequently criticises the Beijing government and its local satrap, chief executive “CY” Leung.
The final straw, it appears, was showing sympathy to the young Hong Kong activists who started a party called Demosistō seeking a referendum on Hong Kong’s relationship with China. Two of them − Joshua Wong, 19, and Nathan Law, 23 − this week got community service orders for leading street protests two years ago, while Alex Chow, 25, got a suspended jail term.
Beijing is worried by the trend. Ahead of elections for Hong Kong’s parliament, the Legislative Council, on September 4, it inserted a new rule to vet candidates. To run, they have to declare their adherence to Hong Kong as an “inalienable part” of China. Nathan Law still seems to be in the running, since he’s avoided a jail sentence, but it’s unclear whether he’s yet made his patriotic declaration.
Anyone Here Been Raped and Speaks English? was the memorable title of the memoir of foreign correspondent Edward Behr, who said he heard a BBC reporter pose this question to a crowd of huddled Belgian refugees during the 1961 crisis in the Congo.
It’s sadly more likely that the gang rape of foreign aid workers by government soldiers in South Sudan on July 11, rather than the countless rapes of Sudanese women reported less specifically during the civil war, might be the event creating the “CNN effect” that finally gets a robust United Nations force into that country, along the lines advocated by Nobel laureate José Ramos-Horta in his recent interview with The Saturday Paper (July 30-August 5).
According to an Associated Press report on the attack, drunken soldiers from President Salva Kiir forces celebrated the ousting of supporters of rebel leader Riek Machar from parts of the capital Juba by invading a hotel housing foreign aid staff. They raped several foreign and local women, beat men with rifle butts, looted valuables, carried out mock executions, and forced all to watch the execution of a local journalist, John Gatluak, whose scarring identified him as belonging to the same tribe as Machar. The beleaguered aid workers got out numerous calls for help as the attack started, but the existing three battalions of UN soldiers in Juba − Ethiopian, Chinese and Nepali − refused to respond.
With Australia even more pilloried for its refugee punishment camps in Nauru and Manus Island, after the latest Guardian revelations, it’s good to know that former attorney-general and immigration minister Philip Ruddock has swung with gusto into his new role of special envoy for human rights.
The Department of Foreign Affairs and Trade tells us Ruddock went to Oslo in June for the Sixth World Congress Against the Death Penalty, and then in July attended the Caribbean Commission’s heads of government meeting in Guyana. Word filtering back from UN human rights circles, however, is that at one encounter Ruddock appeared a little out of date in his new field, seeming not to be aware that rape within marriage is a criminal offence in Australia.
This article was first published in the print edition of The Saturday Paper on Aug 20, 2016 as "ScoMo pulls the plug on China Ausgrid deal". Subscribe here.