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The decision by the Australian government not to cancel the 99-year lease of the Port of Darwin to a Chinese company is a worrying development.

The Port of Darwin was leased to Landbridge Group by the Northern Territory government in 2015. The lease was priced at $506 million.

The awarding of the contract to Landbridge came just a few years after the United States posted the first of a rotating group of US Marines in Darwin. US presence in the Northern Territory has increased since then.

The Northern Territory, Darwin in particular, is a critical element in Australia’s defence.

As regional tensions rise, it will become more so.

The current government initiated a review of the lease following the 2022 election.

The Australian government has the power to end the lease, particularly as it was made by a Territory government.

The Department of the Prime Minister and Cabinet has finalised a review into the circumstances of the lease of the Port of Darwin.

The review concluded that there is a robust regulatory system in place to manage risks to critical infrastructure, including the Port of Darwin; existing monitoring mechanisms are sufficient and will be ongoing; and as a result, it was not necessary to vary or cancel the lease.

The Government announced this week that it has accepted that advice.

“Monitoring of security arrangements around the Port of Darwin will continue. Australians can have confidence that their safety will not be compromised, while ensuring that Australia remains a competitive destination for foreign investment,” said the Department of Prime Minister and Cabinet after consulting defence and security agencies.

The review considered the findings and outcomes of previous assessments, as well as whether risk management and mitigation arrangements are sufficient to protect Australia’s national security interests relating to the Port.

Critical Area

Darwin is the home to significant defence assets. It is Australia’s northern base for the navy, airforce and army.

Any threat to these facilities potentially compromises the security of Australia.

The security agencies have not disclosed what monitoring mechanisms are in place and how they will continue to oversee the situation.

How will they ensure that the port is not compromised or closed down in the case of conflict? How will they ensure that sensitive communications are not compromised?

Given that Chinese corporations are subject to the directions of the Chinese Communist Party, this decision risks Australia’s security.

It is well established that the CCP regards all assets as having dual civil and military uses.

The fact that this decision was released in the weeks before the Prime Minister visits Beijing raises legitimate questions.

Prior to the last election, Mr Albanese described the Turnbull government’s approval of the lease as “a grave error of judgment.”

The government should release more details about how it proposes to monitor and control the arrangements so that Australia’s security is not compromised.

We can only hope that the reassurances prove to be true.