SYDNEY • Australia is reviewing the 99-year lease of a commercial and military port in its north to a Chinese company, a government source said yesterday, a move that could further inflame tensions between Beijing and Canberra.
Canberra overhauled its foreign investment laws last year, giving the government retrospective powers to impose new conditions or even force a divestment on deals already approved.
Defence officials are looking into whether Landbridge Group, owned by Chinese billionaire Ye Cheng, should be forced to give up its ownership of Darwin port on national security grounds, the source said.
Landbridge, which media reports say has close ties to China's military, won a bid in 2015 to operate the port in a deal worth A$506 million (S$518 million).
"Advice has been sought on the port and that will go to the national security committee in due time," said the government source, who declined to be named.
The Sydney Morning Herald newspaper, which first reported the review, has quoted Defence Minister Peter Dutton as saying that the government would "look at options that are in our national interests after that".
The awarding of the contract to Landbridge by the Northern Territory government came just a few years after the United States posted the first of a rotating group of American Marines in Darwin.
The troop posting was part of then President Barack Obama's pivot to Asia following China's increased assertiveness in the region. Mr Obama had reportedly expressed his displeasure at not receiving a heads up on the port deal.
The review comes at a low point in relations between Australia and China, which have fluctuated for years.