One Belt, One Road: Australian 'strategic' concerns over Beijing's bid for global trade dominance

One Belt, One Road: Australian 'strategic' concerns over Beijing's bid for global trade dominance

One Belt, One Road: Australian 'strategic' concerns over Beijing's bid for global trade dominance

Updated 23 October 2017, 7:40 AEDT

China's controversial push to dominate global trade is being resisted by senior national security figures, who warned the Government of "negative strategic consequences" if Australia signed up.

A controversial trillion-dollar push by China to dominate global trade is being resisted by senior national security figures who warn of serious "strategic" consequences if Australia formally signs up.

Key points:

  • China wants to revive an ancient network of land and ocean silk trade routes
  • 68 countries including New Zealand have signed up to project
  • Numerous senior figures in Australia's national security community opposed

The ABC has confirmed the heads of the immigration and defence departments were among those opposed to Beijing's ambitious "One Belt, One Road" initiative, firmly advising the Turnbull Government earlier this year not to join it.

Several government sources have told the ABC the Chinese plan also provoked a schism inside the Department of Foreign Affairs and Trade, with trade bureaucrats broadly in favour of joining while the diplomatic corps was reticent.

So far, 68 countries including New Zealand have signed up to the signature project of Chinese President Xi Jinping, which marks his nation's plans to expand its power in the region and beyond.

"The economic case for Australia formally joining simply wasn't made," a senior government figure has told the ABC.

"We saw very little in additional economic benefit for signing up, but a lot of negative strategic consequences if we accepted Beijing's offer."

Under the massive plan first unveiled in 2013, China wants to revive an ancient network of land and ocean silk trade routes and has already spent billions of dollars on new infrastructure projects for roads, railways, ports and maritime corridors.

The land-based projects are the "belt" while the "road" is made up of maritime routes that will connect China's southern provinces to South-East Asia and the east coast of Africa with ports and railways.

During last week's 19th Party Congress the Chinese President continued to push the Belt Road Initiative and expressed his hope more nations would soon join.

"An opening-up economy will improve while a closed one will lag behind," Mr Xi said in a speech in Beijing's Great Hall of the People during the opening ceremony of the Congress.

Immigration and defence bosses warned against project

At the start of this year federal ministers closely examined and rejected a Chinese investment proposal which linked the Government's plans for northern Australia to the Belt and Road Initiative.

Several Government sources have confirmed Immigration Department secretary Mike Pezzullo and then Defence Department boss Dennis Richardson warned against Australia joining the project because of "strategic" concerns.

Their advice came as Federal Cabinet met to formalise Australia's response to Mr Xi's One Belt, One Road strategy.

Mr Richardson retired in May.

The ABC understands numerous other senior figures in Australia's national security community were also opposed to the idea, believing it unwise to deepen Australia's dependence on China.

China expert Nick Bisley from La Trobe University said he believed Australia's public position on the Belt Road Initiative has so far been muddled and confused.

"The challenge is to say how do we show a little bit of scepticism and caution without necessarily saying, 'Everything you do, China, must be seen as a threat to our national security'," Dr Bisley said.

Last month, shadow treasurer Chris Bowen said Labor would keep an "open mind" on how Australia and China might best collaborate on the Belt and Road Initiative, keeping a "clear-eyed approach to our respective national interests".

Mr Bowen said cooperation would be assessed on a case-by-case basis and could include the use of the $5 billion Northern Australia Infrastructure Facility, which offers concessional loans for economic infrastructure.