NT Chief Minister Adam Giles embraces the Chinese over the Port of Darwin deal

NT Chief Minister Adam Giles at a “friendship” dinner with Chinese billionaire Ye Cheng. Photo: Sanghee Liu Chinese billionaire Ye Cheng and NT Chief Minister Adam Giles express their mateship. Photo: Sanghee Liu

The billionaire boss of Chinese company Landbridge Group, which has acquired the 99-year lease of the Port of Darwin. Photo: Sanghee Liu

Rizhao: For those wanting to get business done in China, the baijiu banquet is a rite of passage. And so, after downing the obligatory shots of the fiery sorghum-based liquor, Northern Territory Chief Minister Adam Giles wrapped Ye Cheng, the billionaire boss of China’s Landbridge Group, in a tight hug.

“In Australia businesspeople who take a risk are often criticised, but they’re the people who make jobs,” Mr Giles told his Chinese counterpart during the lavish 12-course dinner on Saturday night in Rizhao, Shandong province, where he kicked off his five-day China trip.  “You’re not just an honorary Australian, you’re an honorary Territorian.

“You are a good friend, a brother and a good partner,” replied Mr Ye, who might well feel he has not been embraced the same way by the rest of Australia.

The 99-year lease over the Port of Darwin to Landbridge Group, signed in October, made headlines last month after questions emerged over the private enterprise’s ties to the central government and the People’s Liberation Army. The company’s Communist Party secretary, He Zhaoqing, is a former military officer.

The deal has ruffled feathers in Washington, given Darwin is an important staging post for US Marines deployments. In their first official meeting last month, US President Barack Obama expressed his disappointment to Prime Minister Malcolm Turnbull that he had to find out about the deal after the ensuing controversy made news in The New York Times.

Mr Turnbull and Defence Department secretary Dennis Richardson have both been robust in rejecting security concerns over the lease. But Treasurer Scott Morrison has flagged a review of foreign purchases of state and territory infrastructure. A Senate hearing is imminent.

Mr Giles said the backlash stemmed from xenophobia and he rejected suggestions his government could have delivered its message better or done more due diligence, pointing out that the Foreign Investment Review Board, the Defence Department and ASIO had all looked at the deal and raised no issues.

“It’s wrong to seek foreign investment and then complain when it turns up,” Mr Giles said.

The Chief Minister said the “historic” deal would help deliver long-needed investment in the port, with Landbridge committing more than $300 million in development as part of the $506-million deal.

“We’re working out ways to stand up on our own two feet,” he said.

Reluctance from Landbridge’s senior management to speak publicly has helped perpetrate the aura of mystery around it.

Despite personally showing Mr Giles’ delegation and a small group of Australian journalists around his company’s extensive port and refinery facilities, Mr Ye deflected conversations and rejected repeated requests for comment, insisting things remained too sensitive.

The company has also done itself no favours by brusquely rejecting claims that it ran a private militia, when its own website and state media reports showed it did. It is not uncommon for companies of Landbridge’s size to have similar set-ups, which are reservist troops in name but, in the absence of war, more often used for security or firefighting.

Most importantly, it helps the company ingratiate itself with the local government.

Large, successful private enterprises in China have, almost by default, close, deep and intertwined relationships with the government. It is almost necessary to have implicit government backing to be a big commercial success in China. Washington’s concerns are that Landbridge would “report back on everything” to Beijing, including port and US Marines activity.

Mr Giles said Mr Ye’s intimate government connections were a good thing: they had opened doors to other officials and industry leaders, bringing him closer to realising his next step of the territory’s China-focused development plan: direct flights to China from Darwin.

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