Latest news with #DarwinPort
South China Morning Post
6 days ago
- Business
- South China Morning Post
Port in storm threat to China-Australia ties
Just when frayed relations between Beijing and Canberra are on the mend, Australia's efforts to balance a security relationship with the United States and its trading relationship with China have hit a snag. China has intervened in a move to unwind Chinese control of a strategic asset – Darwin port on Australia's northern border. The case has the potential for another flare-up similar to that over the proposal by Hong Kong's CK Hutchison Holdings to sell off container ports including two strategically and politically sensitive operations on the Panama Canal. Chinese firm Landbridge Group was awarded a 99-year lease of the Darwin facility in 2015, under a deal approved by the Northern Territory government, but criticised by the then US president, Barack Obama. The port is not far from where US marines conduct exercises. Investment and management by Landbridge have since turned the port into a profitable operation. Facing criticism ahead of a recent election, Australian Prime Minister Anthony Albanese said his government was working on a plan to buy back the port on national interest grounds, saying it needed to be 'in Australian hands'. Xiao Qian, China's ambassador to Canberra, said: 'Such an enterprise deserves encouragement, not punishment. It is ethically questionable to lease the port when it was unprofitable and then seek to reclaim it once it becomes profitable.' Xiao urged the Australian government to create a fair, transparent and predictable business environment for Chinese companies in Australia. From China's perspective, this case may serve as a cautionary tale about investing abroad, particularly in certain countries. Australia, after all, is a US ally. But if the port is returned to Australian hands, there would be doubts whether Australia could stand up to US pressure in future. That is why China has spoken up. There is likely to be a much tougher geopolitical environment ahead. Canberra should be mindful of warming bilateral relations, with China having lifted trade bans on Australian exports in December. That is thanks in part to a more pragmatic approach from Canberra to relations with Beijing since ties were damaged years ago by security reforms targeting China and a call for an independent inquiry into the origins of Covid-19.
The Independent
7 days ago
- Business
- The Independent
The Australian port at the centre of a tug-of-war between Beijing and Canberra
China and Australia are sparring for control of an Australian port as concern grows over Beijing's exponentially growing influence in the Indo-Pacific. China is vehemently opposing Australia's plan to take back the controversial decades-long lease of the port in the northern city of Darwin. The row deepened this week after reports suggested that American private equity firm Cerberus had shown interest to acquire the lease. The ruling coalition parties of Australia had vowed during the recent election campaign to revoke Landbridge's lease for the port. Landbridge, a private multinational group of companies with interests in ports and logistics, is headquartered in China. Last month, prime minister Anthony Albanese declared that the port should be 'in Australian hands' and vowed to regain control of the "strategic asset". He even reportedly suggested a willingness to nationalise the port if a new buyer could not be found. The port of Darwin, located strategically opposite the Darwin defence base, is one of Australia's crucial gateways for trade, connecting the nation to the Asia-Pacific region. The deepwater port reportedly records a throughput of 4.5 million cargoes and is essential as a supply centre for Australia's oil and gas projects. The Northern Territory state government sold the port's 99-year lease to Landbridge for £374m in 2015, a move criticised by then US president Barack Obama. Around 2,000 US marines conduct exercises for six months of the year in Darwin and air bases in the area are being expanded to host American bombers. The Northern Territory awarded the contract to Landbridge a few years after the US posted the first of a rotating group of marines in Darwin. Australia has lately been building up its northern military bases after signing a security partnership with the US and the UK. The Chinese leaseholder has been adamant in refusing to give up control of the port and Beijing has called the American bid to take over as 'ethically questionable". China's ambassador to Australia, Xiao Qian, has urged Canberra to honour its contract with Landbridge, pointing out that the company has made "significant investments" in the facility. 'Such an enterprise and project deserves encouragement, not punishment,' the ambassador said in a statement on Sunday. 'It's ethically questionable to lease the port when it was unprofitable and then seek to reclaim it once it becomes profitable.' The port of Darwin has become the latest sticking point in relations between Australia and China which have dramatically improved in the three years since Mr Albanese was first elected in May 2022. The nations have been at loggerheads over China's exertion of dominance in the waters between them, not least Beijing's live-fire exercises off Australia's heavily populated east coast earlier this year. The Chinese foreign ministry said this week that Landbridge had obtained the lease on the open market and so its legitimate rights and interests should be fully protected. The Communist Party of China mouthpiece Global Times warned in an editorial that if Australia forcibly took away the lease from Landbridge, it would create 'major enduring pitfalls for the country'. It claimed that Landbridge had invested about £40 in upgrading port facilities, resulting in a 95.7 per cent increase in the total gross tonnage of arriving vessels. In the meantime, Cerberus Capital Management, founded by billionaire investor Stephen Feinberg who was appointed US deputy secretary of defence in March, is preparing a formal proposal to buy the port, The Australian reported. Cerberus has even partnered with Australian freight company Toll to ease concerns about foreign ownership of the strategic port, according to The Australian Financial Review. If the company were to succeed in securing the lease for the port, it would be a major strategic victory for Donald Trump 's administration amid the ongoing trade war with China over high tariffs. The Albanese government said it was running a separate process to identify potential domestic buyers and investors for the port. "There have been numerous meetings with potential proponents for the Port of Darwin," federal lawmaker Luke Gosling, the special envoy for defence and Northern Australia, told Reuters. "We'll work through that process methodically.' The Northern Territory's treasurer, Bill Yan, told the parliament last week that the port must be ready for "heavier defence logistics, the surge in critical mineral exports and the growing LNG cargoes", and operate in "Australian interests". Australian Strategic Policy Institute director of national security programs, John Coyne, said Landbridge agreeing to sell the lease for profit would be an easier pathway for the Albanese government than if it were compelled to intervene to break the lease on national security grounds, which would draw a backlash from China. "Beijing would not be happy with a divestment of an asset like this," he said, adding that it could discourage other foreign investment in Australia. Landbridge insisted that it had no intention of ending its lease. 'Landbridge has not yet received any offers or engagement from the government at any level,' non-executive director Terry O'Connor said. 'It is business as usual at Darwin port as we continue to focus on the growth of our operations.' Darwin is the second major port to get caught in the US-China trade war. China has been trying to block Hong Kong conglomerate CK Hutchison from selling its ports on the Panama Canal to US investment firm BlackRock for £14bn. The Wall Street Journal, citing people familiar with the matter, reported last month that the MSC shipping company, a part of the BlackRock consortium, had held discussions on moving ahead with the bulk of the deal while disputes over the two ports were resolved. Tycoon Li Ka Shing announced in March that CK Hutchison would sell its 80 per cent holding in the ports business covering 43 ports in 23 countries.
NHK
7 days ago
- Business
- NHK
Australia plan to reclaim port control criticized by China
Australia's government is planning to take back control of a port leased to a Chinese company, drawing criticism from Beijing. Australia's Prime Minister Anthony Albanese made an election pledge last month to bring Darwin Port back under Australian control. He said the move was to protect national interests. The site has a strategic location as Australia's nearest port to Asia. It's also in close proximity to an Australian naval base used by US forces. A Chinese firm entered into a 99-year lease for the port in 2015. Washington expressed concern about the move at the time. Australian media recently reported that a company associated with US President Donald Trump has shown interest in acquiring the site. Beijing has come out against Australia's plan to reclaim control. Chinese Foreign Ministry Spokesperson Mao Ning said on Tuesday that the company obtained the lease through the market, and its legitimate interests should be fully protected. China's Ambassador to Australia Xiao Qian also said that the firm turned the port's financial situation around and contributed to the area's development. He added that it was ethically questionable to try and reclaim the site after it had become profitable.
Reuters
27-05-2025
- Business
- Reuters
Cerberus eyes Darwin Port, says Chinese port operator, amid Australia's local ownership push
SYDNEY, May 27 (Reuters) - U.S. private equity firm Cerberus has shown interest in acquiring the lease for Darwin Port, a senior executive of the port's Chinese operator said on Tuesday, amid a push by the Australian government for the port to be returned to domestic ownership. Terry O'Connor, Australia non-executive director of Chinese company Landbridge, which operates Darwin Port, told Reuters that a Cerberus executive met with the port's Chief Executive Peter Dummett a fortnight ago and expressed interest, but had not yet spoken with Landbridge's board. Cerberus did not respond to a Reuters request for comment. Landbridge has previously said the port is not for sale, and that it had not discussed the matter with the Australian government. China's ambassador to Canberra criticised on Sunday Prime Minister Anthony Albanese's election pledge last month to return the strategically located northern port to local ownership. The Northern Territory government sold the port's 99-year lease to Landbridge for $506 million in 2015, a move criticised by the U.S. president at the time, Barack Obama. Around 2,000 U.S. Marines conduct exercises for six months of the year in the northern city of Darwin, where the U.S. and Australia are expanding air bases to host U.S. bombers. The Australian newspaper first reported on Tuesday that Cerberus Capital Management, founded by billionaire investor Stephen Feinberg who was appointed U.S. deputy secretary of defence in March, was preparing a formal proposal to buy the port. "The Chinese enterprise concerned obtained the lease of Darwin Port through the market, and their legitimate rights and interests should be fully protected," Chinese foreign ministry spokesperson Mao Ning said on Tuesday at a regular press conference, replying to a question about Darwin Port. The Australian federal government is running a separate process to identify potential Australian buyers and investors for the port. "There have been numerous meetings with potential proponents for the Port of Darwin," said federal lawmaker Luke Gosling, the special envoy for defence and Northern Australia, in a statement to Reuters. "We'll work through that process methodically," he added. The Northern Territory's treasurer Bill Yan told parliament last week the port must be ready for "heavier defence logistics, the surge in critical mineral exports and the growing LNG cargoes", and operate in "Australian interests". Yan's office did not respond to a request for comment. Australian Strategic Policy Institute director of national security programs, John Coyne, said Landbridge deciding to sell the port for profit would be an easier pathway for the Albanese government than if it were required to intervene to break the lease on national security grounds, which would draw a backlash from China. "Beijing would not be happy with a divestment of an asset like this," he said, adding China could discourage other foreign investment in Australia.
Yahoo
27-05-2025
- Business
- Yahoo
Cerberus eyes Darwin Port, says Chinese port operator, amid Australia's local ownership push
By Kirsty Needham SYDNEY (Reuters) - U.S. private equity firm Cerberus has shown interest in acquiring the lease for Darwin Port, a senior executive of the port's Chinese operator said on Tuesday, amid a push by the Australian government for the port to be returned to domestic ownership. Terry O'Connor, Australia non-executive director of Chinese company Landbridge, which operates Darwin Port, told Reuters that a Cerberus executive met with the port's Chief Executive Peter Dummett a fortnight ago and expressed interest, but had not yet spoken with Landbridge's board. Cerberus did not respond to a Reuters request for comment. Landbridge has previously said the port is not for sale, and that it had not discussed the matter with the Australian government. China's ambassador to Canberra criticised on Sunday Prime Minister Anthony Albanese's election pledge last month to return the strategically located northern port to local ownership. The Northern Territory government sold the port's 99-year lease to Landbridge for $506 million in 2015, a move criticised by the U.S. president at the time, Barack Obama. Around 2,000 U.S. Marines conduct exercises for six months of the year in the northern city of Darwin, where the U.S. and Australia are expanding air bases to host U.S. bombers. The Australian newspaper first reported on Tuesday that Cerberus Capital Management, founded by billionaire investor Stephen Feinberg who was appointed U.S. deputy secretary of defence in March, was preparing a formal proposal to buy the port. "The Chinese enterprise concerned obtained the lease of Darwin Port through the market, and their legitimate rights and interests should be fully protected," Chinese foreign ministry spokesperson Mao Ning said on Tuesday at a regular press conference, replying to a question about Darwin Port. The Australian federal government is running a separate process to identify potential Australian buyers and investors for the port. "There have been numerous meetings with potential proponents for the Port of Darwin," said federal lawmaker Luke Gosling, the special envoy for defence and Northern Australia, in a statement to Reuters. "We'll work through that process methodically," he added. The Northern Territory's treasurer Bill Yan told parliament last week the port must be ready for "heavier defence logistics, the surge in critical mineral exports and the growing LNG cargoes", and operate in "Australian interests". Yan's office did not respond to a request for comment. Australian Strategic Policy Institute director of national security programs, John Coyne, said Landbridge deciding to sell the port for profit would be an easier pathway for the Albanese government than if it were required to intervene to break the lease on national security grounds, which would draw a backlash from China. "Beijing would not be happy with a divestment of an asset like this," he said, adding China could discourage other foreign investment in Australia. Sign in to access your portfolio
