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Australia makes move to fend off infra ‘sabotage’

The country is creating a new body to mitigate security risks for its strategic infrastructure, including electricity, water and port assets.

The Australian government is launching a new entity to manage the “complex and evolving national security risks” that could impact Australia’s critical infrastructure, according to Treasurer Scott Morrison and Attorney-General George Brandis. 

The two officials said that “with increased privatisation, supply chain arrangements being outsourced and offshored, and the shift in the international investment profile, Australia’s national critical infrastructure is more exposed than ever to sabotage, espionage and coercion”.

The new Critical Infrastructure Centre will be tasked with carrying out national security risk assessments and providing advice to help mitigate said risks. It will initially focus on assets deemed strategic in the electricity, water and port sectors, and will release a discussion paper as a first step. 

The initiative follows a number of recent controversial foreign investment rulings in Australia. Last August, the federal government blocked bids by Hong Kong’s Cheung Kong Infrastructure and China’s State Grid to acquire Ausgrid, the country’s largest grid operator, citing national security concerns. The asset was later won by an ‘all-Australian’ consortium led by IFM Investors and AustraliaSuper for A$16.2 billion ($12.3 billion; €11.4 billion) after these submitted an unsolicited offer.

The government has since imposed foreign investment restrictions on the upcoming sale of Endeavour Energy, the third and last grid to be privatised in New South Wales. Local reports said no single foreign investor is allowed to buy more than 25 percent of the 50.4 percent stake, valued at over A$3 billion, that is being put on the block. 

Australia’s Foreign Investment Review Board is currently reviewing an A$7.4 billion proposal by a CKI-led consortium to take over utility operator DUET Group, which owns Western Australia’s Dampier Bunbury Pipeline, Victoria’s Multinet Gas and electricity distributor United Energy.