China infiltrating Australia -The Quadrant identified Malcolm Turnbull as the problem a year ago,and there is the matter of Keshik Capital
Wang Chunming, 91, with grandaughter Isla Turnbull, born in May. Isla is the daughter of Alex Turnbull and Yvonne Wang, and granddaughter of Prime Minister Malcolm Turnbull Photo: Supplied
Malcolm Turnbull leading the charge against Chinese influence?
In a confidential briefing paper shared with Quadrant Online and prepared by people whose business it is to keep tabs on the Middle Kingdom's alliances and ambitions, Malcolm Turnbull's sanguine attitude toward Beijing is described as being of grave concern
Is Prime Minister Malcolm Turnbull pivoting to China and away from the US alliance? It may seem silly to ask, except that he’s been sending subtle signals to that effect for years. Other signals are not so subtle. They include last month’s decision to buy French submarines, despite their non-compatibility with US and Japanese needs in China-contested waters, and last year’s passivity over the Northern territory’s award of a 99-year lease on the strategic Port of Darwin to a Chinese entity.
During the Abbott era, Turnbull showed enthusiasm for Chinese communications giant Huawei to bid for roles in the National Broadband Project. Abbott scotched that proposal, which had flown in the face of security warnings from intelligence agencies. An anonymous background paper has compiled evidence of Turnbull’s Sinophilia.
I do not know who the report’s authors are or their specific roles. I am reliably informed they have worked extensively in Washington and other allied capitals and are well connected with the Australian business and national security communities. There is no classified material in these sources’ document. I have dealt with the authors through an intermediary, a retired senior federal bureaucrat I’ve known professionally for thirty years.
The paper concludes,
“A strong case can be made that the Turnbull Government is re-orienting Australia’s foreign and security policy away from the country’s traditional allies and closer to China. Key Americans and Japanese are not amused but Beijing appears to be delighted…Turnbull feels an affinity and deep respect for China and is comfortable spruiking Beijing’s views and wishes.”
While Turnbull has good economic knowledge about China, he is poorly informed and perhaps uninterested in Chinese security and defence developments and behavior, and he often makes errors of fact and serious errors of judgement, the authors say. Nevertheless, he appears undaunted, even arrogant, in his opinions. Never one to hide his light under a bushel, the authors’ perceive Turnbull as confident he has the complete and fully correct understanding of China, while Americans, Japanese and others with alternative views do not.
He persists in directing actions and inactions which cool Australia’s security relationship with the US and bolster ties with China. Major changes in Australian foreign and security policy are clearly under way through incremental steps. “It is notable, however, that Turnbull has not yet attempted to convince the Australian public that such a marked shift is warranted or desirable,” they say.
Consistent opinion polling suggests that the public would by a big majority be very uneasy about the shift in attitude. Lowy Institute for International Policy last year found 53% of those polled saw the US alliance as “very important” and 27% as “fairly important”. The 53% was 17 points higher than the lowest score, recorded in 2007, in the survey’s ten-year history.
Only 37% agreed that “the US is in decline relative to China, and so the alliance is of decreasing importance.” About 61% thought America’s global leadership would be maintained in the future.
The poll also found that 66% of Australians wanted Australia to do more to resist China’s military aggression in our region, even if this affects our economic relationship. A majority (56%) rejected the statement that ‘having China as an important global power makes the world more stable’.
Turnbull’s long-held views
The authors of the confidential paper maintain that, in a low-key way, the question of Turnbull’s links with China has been around for many years. Reviews of Turnbull’s speeches about China raise serious questions about his approach to security policy and future relations, particularly among well-informed Americans.
“The best and most realistic strategic outcome for East Asia must be one in which the powers (essentially China and the US) are in balance with each side effectively able to deny the domination of the other.”
This, the critics say, is a big departure from long-standing Australian policy of backing the US in retaining strategic predominance in the Indo-Pacific. As they put it,
“Turnbull appears to assume essential political and moral equivalence between China and the US, and that Australia’s and the region’s core interests would not be affected seriously by a major authoritarian state gaining strategic predominance in the Western Pacific. This view is shared by only a few – mostly academic – left wing individuals within Australia’s national security community.”
The Darwin port debacle
Late last year the Turnbull government acquiesced to the NT government entering a 99-year lease for the operation of the Port of Darwin with a Chinese company closely linked to the China Communist Party and People’s Liberation Army. Both federal and NT governments professed to see no security implications. Says the confidential paper:
“This development left most of our national security community incredulous, knowing that China for years had been seeking to acquire or manage port complexes across the Indo-Pacific region for strategic, intelligence and economic reasons.
“All major Australian, US and allied military operations to and from northern Australia rely heavily on access to the port, and will do so for many decades to come.
“The Turnbull government has made no apparent attempt to reverse the lease arrangement.”
The paper continues that Dennis Richardson, Defence Secretary, was called before a Parliamentary committee to explain his involvement. He again defended Defence’s failure to intervene and said the Chinese control of the port was of no strategic value. When asked if he had consulted relevant US authorities, he said that there was no requirement to consult the Americans as it was an Australian sovereign issue.
The paper’s authors add, “There is no evidence that Richardson was disciplined by the PM for his management of the Darwin Port decision. Indeed, all indications are that Turnbull endorsed the lease to the Chinese company.”
Deception at AUSMIN?
The paper claims the Australian government, a few weeks after Turnbull’s accession, misled its American counterparts at AUSMIN 2015 (annual Australia-US Ministerial Consultations) in Boston last October about the Darwin lease, adding to the American’s perplexity.
The paper says the AUSMIN conference had involved extensive discussions on the next stages of developing US military rotations and other activities in Northern Australia
“However, at no stage did the Australian party (Defence Minister Marise Payne, Foreign Affairs Minister Julie Bishop) inform the Americans about the lease of Darwin Port to a Chinese company.” The following day, as the US delegation was flying from Boston back to Washington, it received news of the port lease from an American journalist. The senior Americans felt they had been deceived. As one remarked privately, “This is not the way close allies are supposed to treat each other.”
President Obama raised the matter with Turnbull at APEC in Manila a month later. Turnbull’s was a flippant reply, joking “that the President needed to subscribe to the colourful tabloid, The NT News.” Former US Deputy Secretary of State Richard Armitage said he was “stunned” at Australia blindsiding the US by allowing a Chinese player with People’s Liberation Army links the 99-year lease. Unease was expressed much more widely, and bluntly, in private discussions in Washington. US officials became more assertive in asking: What’s going on?
The curious submarines decision
The decision last month to buy French submarines, rather than Japanese or German boats, rejected US strategic logic aimed at the improvement of regional security. This logic involved joint activities with Australia across our north and in the disputed South China Sea. While US officials would never tell Australia which submarine we had to choose, there was surprise in Washington that the French bid got up. Senior US officials thought we would put at the top of the selection criteria the key issue of regional security and ease of US technical involvement through the life of the boats. The Japanese boat would have scored very highly there. Defence and national security officials in the US and in other allied countries (including Japan and some European countries) are seriously querying the approach of the Turnbull government to defence issues.
Most Australian and US observers’ concerns include
The French boat, which will need to be extensively re-worked and converted from nuclear propulsion to copnventional deisel-electric drive, has not even been designed yet
Little weight appears to have been accorded to the broader strategic benefits of working closely with Japan
Little weight appears to have been given to the critical importance of inter-operability with US and allied forces. The French solution is the weakest in those respects.
Senior Americans had indicated that while respecting Australia’s right to choose, they favored the Japanese subs. Some also indicated privately that they would experience security and other practical difficulties in working with the French in this sensitive area. Yet the Australian government had indicated from the outset that no matter which design was selected, the combat data system (essentially the computers linking the sensors to the command displays and, thence, to the weapons and combat systems), the weapons and certain other systems would all be sourced from the US. For this ambitious project to succeed, the Americans need to be fully comfortable working within a French-designed and largely French-built sub. Given the limited trust that many relevant Americans express about the French, the sub program may well be headed for very troubled waters.
The poor track record of on-time and on-cost delivery of European defence systems in recent years. Particularly poor cases have included the Armed Reconnaissance Helicopters and the Air Warfare Destroyers.
Turnbull on the South China Sea
The confidential paper also objects to Turnbull’s soft stance on China’s expansions in the South China Sea.
“That behavior has involved serious breaches of international law and signaled China’s firm intention to gradually turn this major maritime zone into something akin to an internal sea. The response of the US, Japan and the maritime members of ASEAN has been deep concern and significantly expanded security and defence activity.
The Turnbull government has been pressed by allied governments to increase Australia’s military operations in the region and in particular to undertake frequent freedom of navigation patrols close to China’s newly-established islands and military outposts. The Turnbull government has so far declined to make significant changes to its long-standing pattern of military operations in the region.”
Chinese cyber warfare
The paper adverts to China’s intense and growing intelligence and cyber operations against Australia. The recently retired Director-General of Security, David Irvine, stated publicly at the National Press Club in August, 2014: “I can say that we are seeing growth in espionage and foreign interference against Australia, through both cyber and traditional methods.”
“Espionage and clandestine foreign interference activity against Australian interests is extensive…..Foreign interference in Australia by foreign powers is pervasive. It spans community groups, business and social associations and is directed against all levels of Australian Government and the community … In 2014–15, Australian Government and private sector systems experienced an increase in the range, scale and sophistication of hostile cyber activity by foreign state actors.”
Turnbull’s critics say in their paper,
“While the US government has strongly decried such Chinese activities and even brought formal charges against some relevant PLA officers and officials, the Turnbull government has not made any statements about this Chinese activity, nor has it taken any substantive steps to confront the Chinese leadership on these matters.”
Following last November’s Paris terrorist attacks, Turnbull delivered a national security statement to Parliament. It said our special forces are authorized by our government to help Iraq’s counter-terrorism service in the field at headquarters level only, not “outside the wire” on ground combat.
Turnbull said, “The government of Iraq believes that large scale Western troop operations in its country would be counter-productive…The consensus of the leaders I met at the G20, at APEC and at the East Asia Summit is that there is no support currently for a large US-led Western army to attempt to conquer and hold ISIL-controlled areas.”
The anonymous paper says, disparagingly, that Turnbull was setting up a straw man (“Western army”) and knocking it down, while dodging the substantive issue:
“At the time no senior official in the US or Australia was seriously considering the deployment of a large US-led Western army to Iraq and Syria. What had been under discussion for some time was the possible joint deployment of enhanced intelligence and special force elements to probe ISIL weaknesses and leadership systems and then target them for air and other attacks. The total allied force proposed was to number some 400-1000 with Australia possibly contributing 100-150 special force personnel. Washington was keen for ADF personnel to play a core role. There was a little doubt that the Iraqi government would have endorsed such operations if approached accordingly by Washington and Canberra.”
Turnbull’s straw-man talk was considered very strange by US officials and analysts. “Its effect,” the confidential paper notes, was to distance Australia from the central leadership, planning and conduct of the counter-ISIL campaign, led by the US. Turnbull appeared intent on the ADF continuing to make a modest and low risk contribution to counter-ISIL operations but did not wish to be especially close to the leaders and strategists working to actually defeat ISIL.”
Family Chinese relationships
As a merchant banker/consultant in the 1990s and early 2000s, Turnbull’s biggest funding successes were in China, such as a zinc mine launch in Hubei Province. In that phase he made some enduring relationships with senior Chinese officials and Communist Party members. Turnbull’s son, Alex, is a Mandarin-speaking Sinophile with a long history of personal ties with Chinese peers of his age group, from teenage days to his Chinese wife from 2012, Yvonne Wang (Wang Yi Wen). He studied in Beijing and has been to China many times.
In conversation with intimates, Alex has expressed strong scepticism about US attitudes towards China. These opinions largely echo those of his father, not least concerning what they perceive to be strong anti-China biases in US and other allied policy positions and intelligence assessments.
In business, Alex followed his father into Goldman Sachs and from 2004-15 worked mainly on investment, equity and distressed credit in Asian companies, including Chinese entities. For several years he was based in Hong Kong developing good relations with senior Chinese business, government and party members. His wife, Yvonne Wang, is a Chinese citizen and public relations adviser for Trip Adviser. The paper says,
“The Turnbulls have always been highly sensitive that Alex was married to a Chinese national who comes from parents with CCP (Chinese Communist Party) and military ties. Speculation amongst the Turnbull’s friends had historically been that Wang’s family is exceptionally wealthy and has close PLA ties. This speculation remains.”
The first public reference to such ties was in the AFR (September 17, 2015) after Turnbull won the leadership battle. This article (paywalled) also referenced the historical animus between Turnbull and Australian and US intelligence agencies.
Wang’s father, Wang Chunming, worked for the Chinese Academy of Social Sciences as an expert in international relations, was a member of the CCP, and was reportedly a close friend of former president Jiang Zemin. In unpublished remarks, Alex told a reporter that Wang’s father served on the Chinese equivalent of the National Security Council in an academic capacity.
Yvonne Wang in a 2014 interview with Sassy Singapore magazine (no longer online), said she had lived in Hong Kong, Auckland, Beijing, Vancouver, Washington DC, Boston and London. “I’ve moved every few years for the last two decades,” she said. This “implies that notwithstanding the allegedly modest professional positions held by her father, her family lived around the world during her upbringing,” according to the anonymous paper.
Like his son, Malcolm Turnbull has deep knowledge and affection for many aspects of China and its people, including some senior officials and CCP leaders. Observes the report:
“He frequently expounds Chinese government views and effectively argues Beijing’s case, especially on economic issues. At the same time Turnbull has long expressed scepticism towards more hawkish US and Australian analyses of China and the agendas of intelligence agencies, albeit significantly adjusting his rhetoric when within the line-of-sight of US observers.
“The assumption of many that his pro-China views would evolve materially after he assumed the prime ministership appears to have been proven wrong. As one example, he has privately stated several times following his April 2016 trip to Beijing that ‘the US does not get China’.”
He said twice, incorrectly, that China has no interest in exporting its ideology or system of government to other countries. In fact China has been propagating its “China model” to countries in Africa, Southeast Asia, the Middle East and elsewhere: “Indeed it has frequently backed such efforts with economic and military aid,” the report notes, adding
“Turnbull states that China’s rise has not been matched by any expansionist tendencies beyond reuniting Taiwan. This is revealing on several fronts. First, it implies no interest in assisting the survival of the 23m people in the liberal democracy on Taiwan. Second, it takes no account of China’s highly assertive island-creation and sovereignty expansion in the South China Sea – and assertion of national sovereignty over more than 80% of this extensive international waterway. Third, it ignores China’s claims and highly assertive actions over the Senkaku Islands in the East China Sea. Fourth, it fails to acknowledge the extensive studies undertaken by the PLA into potential future military assaults into parts of East and Southeast Asia.”
Turnbull also erroneously said that Australia’s 2009 Defence White Paper was based on the contingency of a naval war with China in the South China Sea. “In fact, the Paper says no such thing. It states very clearly, (p58) that the primary driver for defence force development should be “to deter and defeat attacks on Australia.”
“Zhong guo ren min zanqilai le: ‘The Chinese people have stood up.’ And so they have – and we are now all taking notice.
The speech prescribed for Australian policy-makers a formula that
The scale and speed of China’s rise implies that it would be futile for Australia to attempt to shape or significantly influence China’s further development
China is a different type of society but it behaves rationally, is largely benign and is unlikely to cause Australia serious problems in coming decades
The central role of trade in China’s prosperity suggests that the country’s rise will be peaceful. Turnbull seems unaware that trade between the UK and Germany was larger in relative terms in the period before WW1, and unaware of the well-studied weak correlation between trade and conflict dissuasion.
In key passages of the speech, Turnbull says, “It makes no sense for America or its allies to base long-term strategic policy on the contentious proposition that we are on an inevitable collision course with a militarily aggressive China.” In fact, the critics say, virtually no-one in Western intelligence believes we are “on an inevitable collision course” with China. In any event, Turnbull seems to be saying we can neither try to deter nor effectively defend against such an eventuality. The most he envisages is some vague actions to ‘hedge against adverse and unlikely contingencies’.
Turnbull’s speech lauded the historical inevitability of China’s global re-emergence and the futility of seeking to contain or in any way shape China’s future actions.
The anonymity of the authors of the paper shared with me and quoted above is for obvious reasons. Judge for yourself if its argument stacks up.
 The poll also found that most Australians (61%) in 2015 believed that “China’s aim is to dominate Asia” but a larger majority (67%) agreed with the more benign view that “China’s aim is to create a better life for the Chinese people”. Nearly 40% thought it likely that China would be a military threat to us in the next 20 years. In the event of a military conflict between China and Japan, 84% thought Australia should be neutral, 11% wanted to support Japan, and 3% supported China.
 The AFR reported: “Mr Richardson hit back at suggestions the deal was not properly considered by his department, and suggested the US Embassy in Canberra should have been paying more attention to developments around the port’s privatisation”.
 In advance Julie Bishop described the meeting thus: The Alliance is the bedrock of our foreign and defence policy and we look forward to further developing and deepening our shared regional and global strategic and economic interests.”