1 00:00:00,160 --> 00:00:02,440 Speaker 1: Now as we know, it's being reported a US private 2 00:00:02,480 --> 00:00:06,040 Speaker 1: equity firm with strong ties to the Trump administration is 3 00:00:06,160 --> 00:00:08,400 Speaker 1: poised to make an offer to buy the Port of 4 00:00:08,440 --> 00:00:13,920 Speaker 1: Darwin from its Chinese owner. New York based Cerebus Capital 5 00:00:13,960 --> 00:00:17,680 Speaker 1: Management is preparing a formal proposal to buy the Port 6 00:00:17,800 --> 00:00:22,759 Speaker 1: of from Lambridge Group's billionaire owner. But is it going 7 00:00:22,760 --> 00:00:25,120 Speaker 1: to go ahead? I mean, should it go ahead? And 8 00:00:25,160 --> 00:00:28,240 Speaker 1: what could the potential changing of hands mean when it 9 00:00:28,280 --> 00:00:31,360 Speaker 1: comes to our relationship with China. Well, joining me live 10 00:00:31,400 --> 00:00:35,800 Speaker 1: on the line is the Australian Strategic Policy Institute's Director 11 00:00:35,840 --> 00:00:41,720 Speaker 1: of National Security Programs, doctor John Coin. Good morning to you, John, Good. 12 00:00:41,520 --> 00:00:44,320 Speaker 2: Morning CARTI you know they changed my title again. I 13 00:00:44,479 --> 00:00:47,280 Speaker 2: wanted to keep my normal Australian Strategic Policy Center title, 14 00:00:47,360 --> 00:00:50,600 Speaker 2: so I'm sorry again. 15 00:00:51,880 --> 00:00:53,559 Speaker 1: That's all right. Well, I was going to say, I've 16 00:00:53,560 --> 00:00:55,520 Speaker 1: got a couple of different titles there for you, so 17 00:00:55,560 --> 00:00:58,279 Speaker 1: I wasn't sure what to use, John, Nah. 18 00:00:58,120 --> 00:01:01,640 Speaker 2: Nah, Look, you know what this conversation goes. I spent 19 00:01:02,400 --> 00:01:04,520 Speaker 2: actually I'm not in Northern Australia, but I spent the 20 00:01:04,600 --> 00:01:07,800 Speaker 2: last eight years concentrating all things Northern Australia. Let's get it. 21 00:01:07,720 --> 00:01:11,200 Speaker 1: Done, Yeah, well, this is it. I know that you 22 00:01:11,319 --> 00:01:16,119 Speaker 1: have got such keen interest and certainly have have such 23 00:01:16,200 --> 00:01:19,240 Speaker 1: knowledge in this space. I mean it is understood that 24 00:01:19,280 --> 00:01:23,080 Speaker 1: this US investment firm is set to offer slightly above 25 00:01:23,520 --> 00:01:26,360 Speaker 1: five hundred and six million dollars at Lambridge paid ten 26 00:01:26,440 --> 00:01:29,040 Speaker 1: years ago for its ninety nine year lease over the port. 27 00:01:29,520 --> 00:01:32,480 Speaker 1: Lambridge saying the facility is not for sale, John, where 28 00:01:32,480 --> 00:01:34,120 Speaker 1: do you think this is all going to go? 29 00:01:35,880 --> 00:01:38,320 Speaker 2: Look, you know what predicting the futures of mugs game, Catie, 30 00:01:38,319 --> 00:01:39,720 Speaker 2: you know that. I know you want me to say 31 00:01:39,920 --> 00:01:41,720 Speaker 2: this is the answer, But I think there's a number 32 00:01:41,720 --> 00:01:44,000 Speaker 2: of different things at play. So first off, if you're 33 00:01:44,040 --> 00:01:47,920 Speaker 2: asking me what Beijing wants, Beijing does not want to 34 00:01:47,960 --> 00:01:50,760 Speaker 2: lose the Port of Darwin and does not want Lambridge 35 00:01:50,760 --> 00:01:53,400 Speaker 2: to lose the Port of Darwin, and there's good reasons 36 00:01:53,440 --> 00:01:55,320 Speaker 2: for that. Australia has been the leader on a couple 37 00:01:55,360 --> 00:01:58,960 Speaker 2: of things that have really irked Beijing. So number one, 38 00:01:59,040 --> 00:02:01,680 Speaker 2: it led on beat in Huawei and then a number 39 00:02:01,720 --> 00:02:05,720 Speaker 2: of other countries followed. Number two, it's stopped investment by 40 00:02:05,800 --> 00:02:09,360 Speaker 2: Chinese firms in some critical minerals investments, and countries like 41 00:02:09,440 --> 00:02:15,440 Speaker 2: Canada followed. If Australia were to divest this from land Bridge, 42 00:02:15,639 --> 00:02:18,520 Speaker 2: that would send a very powerful message across the globe 43 00:02:18,720 --> 00:02:22,280 Speaker 2: in other countries where China has brought infrastructure. So from 44 00:02:22,280 --> 00:02:27,000 Speaker 2: that perspective, Beijing doesn't want that to happen. Land Bridge 45 00:02:27,040 --> 00:02:30,360 Speaker 2: by default won't want that to happen, and certainly they've 46 00:02:30,400 --> 00:02:36,680 Speaker 2: been firm. It's probably in terms of coverage or optics. 47 00:02:36,840 --> 00:02:41,400 Speaker 2: The Albanesi government would prefer that an Australian company working 48 00:02:41,600 --> 00:02:45,800 Speaker 2: by land Bridge. Third, the Alberanesi government would probably prefer 49 00:02:46,000 --> 00:02:50,520 Speaker 2: that transaction occurred without them being forced to divest, so 50 00:02:50,560 --> 00:02:54,040 Speaker 2: that it was just a natural market decision. But what 51 00:02:54,120 --> 00:02:56,720 Speaker 2: I can say is it does seem that we're getting 52 00:02:56,800 --> 00:03:00,200 Speaker 2: ahead of steam around a change in the ownership the 53 00:03:00,240 --> 00:03:01,680 Speaker 2: port of Darwin one way. 54 00:03:01,600 --> 00:03:04,720 Speaker 1: Or the other now in terms of a changing of 55 00:03:04,880 --> 00:03:07,720 Speaker 1: hands and what it might look like or what it 56 00:03:07,840 --> 00:03:12,600 Speaker 1: might mean talk us through that. From that more strategic perspective, 57 00:03:12,680 --> 00:03:15,360 Speaker 1: I guess. 58 00:03:14,720 --> 00:03:17,480 Speaker 2: I think you know, you know, we've had a couple 59 00:03:17,520 --> 00:03:19,959 Speaker 2: of reviews, and I guess people in Darwin and in 60 00:03:20,000 --> 00:03:22,639 Speaker 2: the Northern Territory are probably fed up with this. We're 61 00:03:22,680 --> 00:03:24,400 Speaker 2: going to have a review, so they just want some 62 00:03:24,400 --> 00:03:27,760 Speaker 2: certainty We've asked the same question over and over again, 63 00:03:27,880 --> 00:03:30,040 Speaker 2: you know, is it a security thread? The real issue, 64 00:03:30,080 --> 00:03:33,799 Speaker 2: I think I've said this before is that the Darwin 65 00:03:33,919 --> 00:03:38,040 Speaker 2: Port is our most northern deepwater port. It has great 66 00:03:38,080 --> 00:03:41,800 Speaker 2: strategic value, not for just national security, but it's a 67 00:03:41,840 --> 00:03:46,440 Speaker 2: bridge into the region and the port is critical to 68 00:03:46,520 --> 00:03:51,360 Speaker 2: the future economic development of the Northern Territory. Now, at 69 00:03:51,400 --> 00:03:56,960 Speaker 2: a baseline, there may be some divergence between what is 70 00:03:57,000 --> 00:03:59,040 Speaker 2: in the best interest in the development of that port 71 00:03:59,200 --> 00:04:03,360 Speaker 2: for the Northern Territory and Australia versus what Beijing may 72 00:04:03,440 --> 00:04:05,560 Speaker 2: or may not want and what land Bridge may or 73 00:04:05,560 --> 00:04:08,360 Speaker 2: may want not want there. So, the way I see 74 00:04:08,400 --> 00:04:11,400 Speaker 2: it is this is that we really want to have 75 00:04:11,520 --> 00:04:15,040 Speaker 2: someone who owns the Darwin Port who has the same 76 00:04:15,240 --> 00:04:19,040 Speaker 2: economic national security interests as the people in the Northern 77 00:04:19,120 --> 00:04:22,040 Speaker 2: Territory do have in their port. And there's the Australian 78 00:04:22,120 --> 00:04:24,080 Speaker 2: government and the Australian people have in that port. 79 00:04:24,600 --> 00:04:27,240 Speaker 1: I mean, you would think that aligning with the US. 80 00:04:27,720 --> 00:04:29,880 Speaker 1: You know, some would say that's a natural sort of 81 00:04:29,960 --> 00:04:33,960 Speaker 1: alignment to go down. I guess others may may be 82 00:04:34,240 --> 00:04:37,039 Speaker 1: concerned that if we go down that path that it 83 00:04:37,080 --> 00:04:40,400 Speaker 1: could mean China gets quite annoyed. 84 00:04:41,440 --> 00:04:44,880 Speaker 2: Look, China probably, as I said at the start, if 85 00:04:44,880 --> 00:04:49,760 Speaker 2: there's does no matter who goes on to own the port. 86 00:04:50,240 --> 00:04:54,599 Speaker 2: If there's if it's divested to another owner, Beijing will 87 00:04:54,600 --> 00:04:58,480 Speaker 2: be incredibly unhappy that that's occurred, not just because of 88 00:04:58,520 --> 00:05:01,400 Speaker 2: the loss of Darwin Port, but because what it might 89 00:05:01,480 --> 00:05:04,320 Speaker 2: do more broadly across the globe in terms of ownership 90 00:05:04,360 --> 00:05:08,160 Speaker 2: of infrastructure. So the other part is is that you know, 91 00:05:09,320 --> 00:05:13,680 Speaker 2: in terms of international relations, Australia making decisions that are 92 00:05:13,680 --> 00:05:16,680 Speaker 2: in the best interests of our national security and our 93 00:05:16,720 --> 00:05:21,280 Speaker 2: economic growth is the right of a sovereign state. At 94 00:05:21,279 --> 00:05:23,160 Speaker 2: the end of the day. We shouldn't be changing that. 95 00:05:23,279 --> 00:05:26,760 Speaker 2: So you know, I put it the different way, would 96 00:05:26,839 --> 00:05:30,800 Speaker 2: China allow an Australian company to own poor infrastructure in 97 00:05:30,920 --> 00:05:35,400 Speaker 2: mainland China? And if there was a divergence of opinion 98 00:05:36,000 --> 00:05:38,800 Speaker 2: in Beijing where an Australian company owned a port or 99 00:05:38,920 --> 00:05:42,400 Speaker 2: owned some sort of infrastructure, would we be having the 100 00:05:42,440 --> 00:05:44,760 Speaker 2: same or would they be having the same hand ringing 101 00:05:44,920 --> 00:05:47,640 Speaker 2: over whether or not Australia was happy or unhappy with it. 102 00:05:47,680 --> 00:05:49,240 Speaker 2: And I know the answer to that, and that is no, 103 00:05:49,760 --> 00:05:53,599 Speaker 2: Beijing will always do and they're unapologetic about this what's 104 00:05:53,640 --> 00:05:56,080 Speaker 2: in the best interest of their nation, and I have 105 00:05:56,160 --> 00:05:57,560 Speaker 2: taught them for that now I know. 106 00:05:57,720 --> 00:06:01,080 Speaker 1: The Chinese ambassador on Sunday, while in Darwin, said it 107 00:06:01,080 --> 00:06:04,320 Speaker 1: would be unfair to acquire the asset when Landbridge had 108 00:06:04,360 --> 00:06:08,880 Speaker 1: invested in it and such an enterprise and project deserves encouragement, 109 00:06:09,440 --> 00:06:12,720 Speaker 1: not punishment. He said it is ethically questionable to leae 110 00:06:12,760 --> 00:06:16,800 Speaker 1: support when it was unprofitable and then seek to reclaim 111 00:06:16,839 --> 00:06:20,600 Speaker 1: it once it became profitable. I guess I'm not overly 112 00:06:20,680 --> 00:06:23,360 Speaker 1: surprised by that statement from the ambassador. 113 00:06:24,520 --> 00:06:26,640 Speaker 2: No, I'm not surprised either, but I guess you know, 114 00:06:26,680 --> 00:06:28,120 Speaker 2: and I don't want to play a game of what 115 00:06:28,160 --> 00:06:30,919 Speaker 2: about isn't? But I guess it was really unfair on 116 00:06:31,000 --> 00:06:35,880 Speaker 2: Australian winemakers when all manner of economic coercion was applied 117 00:06:35,920 --> 00:06:39,600 Speaker 2: to them. I guess it was really unfair for those 118 00:06:39,640 --> 00:06:42,400 Speaker 2: people in the lobster industry who lost jobs and had 119 00:06:42,440 --> 00:06:48,760 Speaker 2: financial insecurity because of those issues. So barley farmers were 120 00:06:48,800 --> 00:06:51,320 Speaker 2: in the same boat. So I think this discussion of 121 00:06:51,440 --> 00:06:54,600 Speaker 2: fair and unfair at the end of the day, that 122 00:06:54,640 --> 00:06:57,520 Speaker 2: it's not about a question of fair and unfair. Just 123 00:06:57,680 --> 00:07:01,000 Speaker 2: like China made decisions in relation of the CCP made 124 00:07:01,720 --> 00:07:06,280 Speaker 2: decisions in relation to those those issues. Australia is simply 125 00:07:06,320 --> 00:07:10,320 Speaker 2: looking at its economic development and making its sovereignty and 126 00:07:10,320 --> 00:07:13,160 Speaker 2: its national security and making a decision around that came. 127 00:07:13,320 --> 00:07:17,200 Speaker 2: So you know, I guess that's a very easy throwaway 128 00:07:17,240 --> 00:07:18,680 Speaker 2: line from the ambassador. Yeah. 129 00:07:18,760 --> 00:07:20,160 Speaker 1: Well, and I mean, at the end of the day, 130 00:07:20,240 --> 00:07:22,200 Speaker 1: like you've pointed out, China will do what is best 131 00:07:22,240 --> 00:07:25,320 Speaker 1: for China and Australia should do what is best for Australia. 132 00:07:25,760 --> 00:07:27,840 Speaker 1: I mean, do you think though a forcing of the 133 00:07:27,880 --> 00:07:31,880 Speaker 1: sale would cause diplomatic tensions or concerns with China? 134 00:07:32,920 --> 00:07:36,000 Speaker 2: Look, I think it will cause tensions. And you know, 135 00:07:36,040 --> 00:07:40,160 Speaker 2: there's no doubt that Beijing, in my mind, does not 136 00:07:40,400 --> 00:07:42,640 Speaker 2: want this to occur, and not just because of the 137 00:07:42,640 --> 00:07:44,800 Speaker 2: port of Darwin, but as I was saying before, because 138 00:07:44,840 --> 00:07:48,080 Speaker 2: what message would this send globally if Australia was the 139 00:07:48,120 --> 00:07:51,640 Speaker 2: first country to say, you know what, we're okay with 140 00:07:51,800 --> 00:07:55,760 Speaker 2: China investing in our coal mines, We're okay with them 141 00:07:55,800 --> 00:07:59,360 Speaker 2: investing in iron ore mining, but we're not okay with 142 00:07:59,400 --> 00:08:03,080 Speaker 2: them owning so certain pieces of strategic infrastructure, and other 143 00:08:03,120 --> 00:08:05,680 Speaker 2: countries would as they've done in the past, as they 144 00:08:05,720 --> 00:08:09,400 Speaker 2: did with Huawei infrastructure. They would sit there and look 145 00:08:09,440 --> 00:08:12,280 Speaker 2: at those decisions and go through that process themselves. So 146 00:08:12,360 --> 00:08:15,200 Speaker 2: you know, Beijing doesn't want that to occur. But the 147 00:08:15,240 --> 00:08:19,280 Speaker 2: other thing about international relations is that they do ebb 148 00:08:19,280 --> 00:08:22,320 Speaker 2: and flow. So you know, it may cause a bump 149 00:08:22,320 --> 00:08:26,040 Speaker 2: in the road for the relationship between China and Australia, 150 00:08:26,200 --> 00:08:29,520 Speaker 2: but we shouldn't also paint it in a very binary way. 151 00:08:29,600 --> 00:08:33,120 Speaker 2: So we're not saying that China can't do business in Australia. 152 00:08:33,520 --> 00:08:35,800 Speaker 2: We're quite the opposite. You know, we're happy to do 153 00:08:35,840 --> 00:08:37,760 Speaker 2: business with them in a whole range of areas that 154 00:08:37,920 --> 00:08:42,720 Speaker 2: don't impact on our sovereignty, national security, and that's iron ore, 155 00:08:42,880 --> 00:08:45,680 Speaker 2: that's coal. We're happy with that. But we're saying in 156 00:08:45,720 --> 00:08:49,800 Speaker 2: this specific spot, place and space that that is not 157 00:08:49,880 --> 00:08:50,319 Speaker 2: the case. 158 00:08:51,320 --> 00:08:54,760 Speaker 1: Now, looking at this from the other perspective and looking 159 00:08:54,760 --> 00:08:56,760 Speaker 1: at the fact that you know that we could see 160 00:08:56,760 --> 00:09:01,920 Speaker 1: the port change hands to a US base firm, I mean, 161 00:09:01,960 --> 00:09:05,680 Speaker 1: what do you think that US investment would mean or 162 00:09:05,720 --> 00:09:07,760 Speaker 1: why do you think they want the port? Obviously I'm 163 00:09:07,800 --> 00:09:10,320 Speaker 1: assuming because it is so important, but what do you 164 00:09:10,360 --> 00:09:10,880 Speaker 1: make of that? 165 00:09:11,640 --> 00:09:16,120 Speaker 2: Look, it's always difficult in when you're talking about when 166 00:09:16,120 --> 00:09:19,640 Speaker 2: you talk about funds like Service going through and making offers. 167 00:09:19,880 --> 00:09:22,520 Speaker 2: I think my understanding is that there has been no 168 00:09:22,720 --> 00:09:25,760 Speaker 2: formal statement from them in relation to an offer, and 169 00:09:25,800 --> 00:09:29,559 Speaker 2: that it is an ongoing perhaps it's not even ongoing discussion, 170 00:09:30,520 --> 00:09:33,760 Speaker 2: it's a statement at the moment or speculation. What I'd 171 00:09:33,800 --> 00:09:37,320 Speaker 2: say is Service has a history of investing in pieces 172 00:09:37,320 --> 00:09:42,040 Speaker 2: of infrastructure that have a national security lens for the US. 173 00:09:42,240 --> 00:09:45,960 Speaker 2: So they were involved in buying back Subic Bay in 174 00:09:46,000 --> 00:09:50,280 Speaker 2: the Philippines and redeveloping it both as an investment with 175 00:09:50,400 --> 00:09:53,600 Speaker 2: long term patient capitals. So what I mean by that 176 00:09:53,720 --> 00:09:56,520 Speaker 2: is they weren't looking to take an immediate profit. They 177 00:09:56,559 --> 00:09:58,520 Speaker 2: were looking at the long term and they saw it 178 00:09:58,520 --> 00:10:01,840 Speaker 2: as a wise investment in the inter of US national security. 179 00:10:01,880 --> 00:10:04,200 Speaker 2: So they do have that sort of history, you know. 180 00:10:04,360 --> 00:10:07,160 Speaker 2: For my money, you know, I would love, I would 181 00:10:07,200 --> 00:10:12,839 Speaker 2: love for an Australian superannuation fund to come along and 182 00:10:13,400 --> 00:10:16,160 Speaker 2: look at this as a patient capital activity and invest 183 00:10:16,200 --> 00:10:20,199 Speaker 2: in the long term economic development of Australia. So and 184 00:10:20,360 --> 00:10:26,199 Speaker 2: certainly that's a much better optics than moving from an 185 00:10:26,280 --> 00:10:29,520 Speaker 2: owner that's linked to the Chinese Communist party to an 186 00:10:29,520 --> 00:10:33,480 Speaker 2: owner that has strong ties the US government, so it'll 187 00:10:33,520 --> 00:10:36,520 Speaker 2: be much better to have an Australian superannuation fund or 188 00:10:36,520 --> 00:10:38,760 Speaker 2: hedge fund invest in that sort of infrastructure. 189 00:10:39,559 --> 00:10:42,920 Speaker 1: Well, Dr John Coyn, it is always interesting to catch 190 00:10:43,000 --> 00:10:46,079 Speaker 1: up with you. I always appreciate your insight. Thank you 191 00:10:46,280 --> 00:10:48,040 Speaker 1: very much for having a chat with us this morning 192 00:10:48,080 --> 00:10:50,960 Speaker 1: about the Darwin Port, and no doubt we'll be talking 193 00:10:51,040 --> 00:10:51,920 Speaker 1: to you again soon. 194 00:10:52,760 --> 00:10:54,320 Speaker 2: No, I thank Cardie. I look forward to it. 195 00:10:54,400 --> 00:10:55,760 Speaker 1: Thank you, thank you so much.