Monday, March 20, 2017

China snubbed on road and port push

China snubbed on road and port push

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  • The Australian

The Turnbull government is set to rebuff the Chinese President’s calls to align Australia’s $5 billion Northern Australia Infrastructure Facility with a massive Chinese ­investment program in ports and roads that is being rolled out around the world.

Senior government sources saythat while China was keen to ­officially link the facility with the Chinese infrastructure program known as the One Belt, One Road initiative, “we won’t be formalising any ­linkage”.

The news comes ahead of ­Chinese Premier Li Keqiang’s visit to Sydney and Canberra from Wednesday.

Chinese leader Xi Jinping called for the alignment of the ­initiative with Australia’s northern development plan when he met Malcolm Turnbull last year.

The Belt Road Initiative aims to partner with foreign government and companies to channel trillions of dollars into ports, roads and other major infrastructure worldwide to counter the country’s maritime vulnerabilities.

Western defence hawks say it could create a China-led bloc to counter the US.

Chinese media reported earlier this month that the country had signed contracts worth more than $126bn with 61 countries.

The Australian reluctance to align its plans with those of the Chinese comes as the northern Australia development plan is set to gather momentum.

Minister for Resources and Northern Australia Matt Canavan said five projects to be funded under the facility were “close to ­financial close”.

Washington rebuked Canberra in late 2015 for allowing the former Northern Territory govern­ment to lease the Port of Darwin, which is a hub for rotating US marines, to Chinese firm Landbridge, whose head, Ye Cheng, has previously said the company’s ­investment in the Northern Territory port helped serve the Belt Road Initiative’s strategic and foreign policy goals.

The Australian government has pursued investment for Australian firms through the initiative, also known as the “Maritime Silk Road” or the “One Belt, One Road”, but was finding it hard to pin down how the scheme worked.

The source pointed to the fact that the Northern Australia Infrastructure Facility had a specific contact point, sum of funds and application process, which they said was somewhat “elusive” with the Belt Road Initiative.

Australian business favours the initiative, with Asciano chairman Malcolm Broomhead helping set up an advisory group to assist Australian industry to reap rewards from any potential investments, and the Australia-China Business Council urging Australia to get ­involved early to shape its rules.

Stephen FitzGerald, Australia’s first ambassador to China, said the initiative was going to be a “major influence in world affairs” and in our region.

He agreed Australia needed to be involved in order to try to influence and understand it as countries in Australia’s orbit were already receiving funds through the initiative. Mr FitzGerald also said there were financial reasons Australia should be involved.

In March, India announced it was opposed to the initiative since the China-Pakistan Economic Corridor, which China is building to connect the Gwadar Port in southwestern Pakistan with Xinjiang in far-western China, passes through India.

The hallmark European project of the initiative, the Belgrade to Budapest high-speed rail line, faces a Brussels-led investigation.