Australia blocks Chinese grid purchase

The Australian government has stepped in to halt the sale of the country’s largest electricity network amid fears about national security.

China’s State Grid Corp and Hong Kong’s Cheung Kong Infrastructure Holdings (CKI) were attempting to buy a 50.4 per cent controlling stake in Ausgrid, which is New South Wales’s electricity distribution network.
Chinese and Australian flags
Australian Treasurer Scott Morrison has said the foreign investment proposals from Chinese and Hong Kong bidders “were contrary to the national interest.”

Morrison added that during the review process, national security issues were identified in critical power and communications services that Ausgrid provides to business and governments.

In a statement responding to the decision, CKI said: “We believe that the Australian Government must have reasons beyond the obvious which led them to make today’s announcement. The issue is unrelated to CKI.”

The preliminary decision reflects public and political unease over the scale of Chinese investment in critical infrastructure and farm land in Australia ࢀ” echoed around the globe ࢀ” that has intensified following the recent election.

The power grid sale, which is reportedly worth around $7.5bn (à‚£5.8bn), would have allowed the Chinese and Hong Kong bidders to acquire the controlling stake in Ausgrid for 99 years.

Mr Morisson said the bidders need to address the government’s concerns, and that they have until the 18th of August to submit their proposals to him, at which time a final decision will be made on the project.

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