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Tuesday, 29 May 2018
Page: 4859

Mr DANBY (Melbourne Ports) (19:03): There hasn't been a scene like it since before the First World War, when the Kaiser reviewed the German High Seas Fleet. There in the South China Sea, standing on the deck of one of Beijing's newest warships, was China's leader, Xi Jinping, reviewing a sail-past of the entire Chinese navy—aircraft carrier, cruisers, destroyers, submarines on the surface—and fly-pasts of helicopters and the latest aircraft. Xi's naval review had the same purpose as that of the German Kaiser: intimidate your neighbours. Chinese aggressive military expansion in the South China Sea repudiates with contempt the solemn pledge he made while standing next to American President Obama that he, as China's leader, would not militarise the South China Sea—let alone the repudiation of the Permanent Court of Arbitration ruling that the South China Sea was international high seas and no-one had the right to militarise it or colonise its rocky outcrops as islands.

So what's the current situation in the South China Sea, through which 50 per cent of the world's maritime trade transits, through which 60 per cent of Australia's maritime trade transits and of which the Chinese President told President Obama 'China does not intend to pursue militarisation'?

John Kehoe, in The Financial Review today, quotes the new head of the US Pacific Command, Admiral Philip Davidson, who conceded that 'China is now capable of controlling the South China Sea in all scenarios short of war with the United States'. This is further proof of what Fairfax International editor Peter Hartcher catalogued on the ABC the other night as 'a tectonic shift in military power by China in the last six months'. Apart from the deployment of long-range aircraft from the Paracels, and presumably from the Spratlys, which could reach North Australia, missiles have appeared on three Chinese occupied features—Fiery Reef, Mischief Reef and Subi Reef. Their weapons are YJ12B anti-ship cruise missiles with a range of 295 nautical miles and HQ98B surface-to-air missiles which can hit projectiles, planes and drones within 160 nautical miles.

So what has happened with these missiles is that all of the South China Sea is dominated and merchant ships and naval ships can only sail there as long as it is okay by Beijing. Brash generals in the PLA and ideological zealots in The Global Times brim with disdain at the decision of the International Court of Appeals that no country in the international rules based system, including China, has the right to set up fake islands and claim sovereignty in the South China Seas, which were the high seas.

Matching this warlike build-up by Beijing is their remorseless attempt to achieve a victory without kinetic conflict. 'Sharp power' is what The Economist described it as. In Australia, it has come to be known as foreign interference. What are we talking about when we talk about Beijing's interference? Let's review it. Some months ago the Secretary of the Department of Foreign Affairs, Frances Adamson, warned Beijing not to interfere in Australian universities. Later, small 'L' liberal academic John Fitzgerald, of Swinburne University in Melbourne, documented Beijing's buyout of the Australian-Chinese press. Even Greens Party academic and enthusiast Clive Hamilton waxed passionate about it. His book looked at Beijing's political interference in Australia via political donations in the millions of dollars and through the APPRC, the local arm of the United Front Work Department, described by President Xi at the recent Communist Party Congress as 'China's magic weapon'. In the media, Four Corners famously exposed Beijing's pattern of donations to political parties and the use of front organisations to carry out the works of the United Front Work Department.

In Beijing's corner is mining billionaire Twiggy Forrest, the principal business ally of Beijing in Australia, who attended the Boao Forum, China's version of Davos, which, ironically was held on Hainan Island, where Beijing has its forward submarine base. Together with a bevy of media lackeys paid by him to attend, he complained that Australia's concerns about foreign interference and militarisation would spoil Australia's business commercial benefits from, in his case, selling vast amounts of iron ore to Beijing and to Chinese power plants.

That is not what the figures of the Foreign Investment Review Board demonstrate. The Foreign Investment Review Board reports that in the financial years from 2010 to 2016 there was $160 billion of direct investment in Australia by individuals and entities from China. Investment has risen from $16.9 billion in financial year 2010-11 to $47 billion in 2015-16. That is a good thing, but it demonstrates that the concerns about China's investment being scared off by us asserting our sovereignty have little basis.

A peak business body of companies in China labelled political commentary out of Australia as 'unhelpful'. Udo Doring, of the Australian Chamber of Commerce in Shanghai, said: 'Our view and the view of our members is that we have nothing to gain and everything to lose if the bilateral relationship continues to worsen.' I believe that Beijing and its companies make decisions on a commercial basis, as is demonstrated by the Foreign Investment Review Board.

Of course, Australia is a proud country, a rich country with deep democratic traditions. We have the 12th-largest economy in the G20. Parliament recently rebelled against the signing of an extradition treaty with China, which executes 3,000 people a year and has a conviction rate of 99.6 per cent in all crimes that come before court. Labor's shadow foreign minister said today in The Australian Financial Review:

… Australia needs to better help Pacific island neighbours, tacitly to counter China's creeping influence with what some critics allege is "debt trap" diplomacy with small, poor nations.

According to the article, Penny Wong:

… sees herself as a pragmatist on foreign policy. She believes Australia should constructively try to shape China's behaviour in a positive fashion, within the—


rules based order.

Thankfully in Australia there is push back against the concerted attempts to twist Australia's arm. China's sharp power has been dealt with by this parliament with legislation on foreign interference that I predict will go through after review by the Parliamentary Joint Committee on Intelligence and Security, and of course the Foreign Investment Review Board has stepped up to the mark, barring the acquisition of Ausgrid and not repeating the mistake of selling the Port of Darwin to a Beijing state owned enterprise. Why was the Ausgrid decision important? Despite the failure of the Attorney-General's Department to advise the government, the sale of the key power asset may have compromised infrastructure that is critical to the support of the joint facilities in Pine Gap. They are, of course, the centrepiece of the ANZUS alliance.

Some years ago, under pressure from Labor, which demanded a briefing by ASIO, Malcolm Turnbull, now the Prime Minister but then the communications minister, was forced to bar Huawei from bidding for the new core of Australia's telecommunications, the NBN. Now he and his government must resist the blandishments of commercial interest backed by apparently incompetent advice from bureaucrats who don't understand the implications of the sale of the 5G network to state owned enterprises or China based companies that are effectively controlled by Beijing. I'm talking about Huawei and ZTE. Both these telcos are subject to government or Communist Party dictates. Both Huawei and ZTE must report to a Communist Party cell at the top of their organisations. Let me issue a clarion call to this parliament, the media and the Australian public. Australia's 5G network must not be sold to these telcos. Whatever instructions might be issued for Australian sovereignty after the fact, they will be compromised if we sell the construction of our new central communications 5G network to companies effectively controlled by an authoritarian government whose leader has recently been made dictator for life.

I am proud that in Australia, as in other countries, there is a pushback against this outrageous internal and external attempt to make us surrender to aggrandising power by Beijing. Of course we must maintain good commercial relationships with China. It's a vast country, and we do admire the fact that hundreds of millions of people have been brought out of poverty by economic developments there. But I ask my fellow Australians to listen to the words of the Director-General of ASIO, Duncan Lewis, who said there has never been such a level of foreign interference in Australia. I urge them to listen to the words of the liberal editor at Fairfax and on the ABC, Peter Hartcher, with his warnings in the last few days. Unusually for me, I even draw attention to the book, works and writings of Greens Party academic Clive Hamilton, whose descriptions of political interference in Australia are certainly true and ought to be paid attention to by all the Australian public. I seek leave to table the Foreign Investment Review Board figures on increasing Chinese investment.

Leave granted.