On February 11, Chinese Ministry of Foreign Affairs spokesperson Zhao Lijian was asked to comment on Australian media reports that Chinese spies sought “to fund candidates for Australia’s opposition Labor Party in an upcoming federal election.”
Mike Burgess, director-general of the Australian Security Intelligence Organization (ASIO), the country’s counter-espionage agency, had said on February 9 that his agency thwarted a foreign interference plot led by a wealthy businessman with deep connections with a foreign power.
“I’ll call this person ‘the puppeteer’,” he said, without naming the individual, country behind the plot or which election was targeted.
Unnamed security sources not authorized to speak publicly confirmed to Australian media that China’s intelligence service was behind the plot.
According to reports by The Australian Broadcasting Corp (ABC), The Sydney Morning Herald (SMH) and The Age, the plot aimed to bankroll Labor Party candidates from the state of New South Wales in the federal election set for May.
On February 11, Zhao dismissed the Australian media reports as “not worth refuting at all.”
“China has no interest in and has never interfered in Australia’s internal affairs,” he said.
That is false.
In fact, for years there have been reports alleging that China conducted malign influence activities aimed at manipulating Australian politics and civil society.
These have included political donations linked to the Chinese Communist Party (CCP) and used to buy access and influence in major Australian political parties, as well as CCP-linked efforts to co-opt and control Chinese-language media and the Chinese diaspora in Australia.
Evidence shows China attempted to shape discussion and silence criticism on Australian university campuses, and exploited Australian-funded scientific research to support the modernization of its People’s Liberation Army (PLA).
“Australia is the canary in the coal mine of Chinese Communist Party interference,” wrote John Garnaut, former senior adviser to Australian Prime Minister Malcolm Turnbull.
In June 2017, a joint investigation by ABC and Fairfax Media revealed that ASIO identified billionaire property developers Huang Xiangmo and Chau Chak Wing, two of Australia’s biggest political donors and both of Chinese descent, as suspected agents of CCP interference in Australian politics.
According to the joint investigation, in 2015, then-ASIO chief Duncan Lewis secretly warned top officials of Australia’s major political parties against accepting donations from the two men.
ASIO believed the two developers had deep connections to the Chinese Communist Party, and that their political cash “might come with strings attached,” the report said.
Chau is an Australian citizen. Huang, a Chinese national, acquired permanent residency in Australia and applied for Australian citizenship.
The two men, directly or through associated entities, donated approximately 6.7 million Australian dollars over a decade, the joint investigation revealed. The donations were often made in the lead up to federal or state election campaigns.
Among the ABC-Fairfax report’s most notorious disclosures involved a 400,000 Australian-dollar donation that Huang promised to the Labor Party in the lead up to the 2016 federal election.
Huang reportedly threatened to rescind the offer after Labor leadership condemned China’s island building in the South China Sea and voiced support for freedom-of-navigation operations.
The day after Labor leadership condemned Beijing, Sen. Sam Dastyari, then a rising politician and Labor Party deputy whip, stood alongside Huang at a Chinese media conference in Sydney and parroted Beijing’s South China Sea talking points.
According to the ABC-Fairfax report, there was no evidence Dastyari knew about Huang’s threat to cancel the donation. Dastyari initially denied making pro-China remarks, but leaked audio proved that he did. Dastyari reportedly also gave counter-surveillance advice to Huang in 2016, allegedly warning him that ASIO might have tapped his phone.
Following those revelations, Dastyari resigned in December 2017.
Earlier, media alleged that Huang and another CCP-linked ethnic Chinese donor had paid for Dastyari’s personal legal and travel bills, and that Dastyari had repeatedly contacted Australian immigration authorities personally to check on Huang’s citizenship application.
Huang contributed millions to Australian universities, including 1.8 million Australian dollars to University of Technology Sydney to establish the Australian-China Relations Institute.
The institute’s first director, Bob Carr, a former Australian foreign minister, described the think tank as holding an “unabashedly positive and optimistic view of the Australia-China relationship.”
Huang also came under scrutiny for his links with the United Front Work Department (UFWD), a CCP lobbying entity accused of buying political influence abroad. He chaired the UFWD-linked Australian Council for the Promotion of Peaceful Reunification of China (ACPPRC).
“Although the ACPPRC claims to be an independent civic organization, its leadership selection and activities are closely guided by the Chinese embassy in Canberra and local Chinese consulates,” wrote Amy Searight, senior associate for Asia at the Center for Strategic and International Studies (CSIS), in Washington, D.C.
“China’s efforts to influence and shape public discourse and political outcomes beyond its borders go well beyond the legitimate public diplomacy that all governments engage in,” Searight added. “The CCP uses unofficial channels in ways that are opaque, deceptive, and manipulative to influence foreign governments and citizens – leaving the realm of legitimate public diplomacy far behind.”
In 2019, Huang was stranded in Beijing after Australian authorities declared him unfit to hold Australian citizenship and stripped his permanent residency status.
That decision was based on “a range of reasons, including character grounds,” the SMH reported, citing senior government sources. “They were also concerned about the reliability of his answers in interviews and correspondence with authorities including ASIO.”
Huang criticized the Australian authorities’ decision.
“It is profoundly disappointing to be treated in such a grotesquely unfair manner. The decision to cancel my visa was based on unfounded speculations that are prejudiced and groundless,” Huang told the Australian Financial Review.
On February 14, Labor Party Sen. Kimberley Kitching identified Chau Chak Wing as the “puppeteer” the ASIO chief had accused of seeking to buy election candidates at the behest of a foreign power, Agence France-Presse reported.
Chau denied Kitching’s allegation, calling it “baseless and reckless.”
Australian parliamentarians and media have repeatedly accused Chau of covertly pushing the CCP’s interests. Chau has steadfastly denied the allegations and successfully sued local media for defamation, AFP reported.
Chau’s real estate company, Kingold Group, is based in the southern Chinese city of Guangzhou. He bought into a local newspaper in a joint venture with the Yangcheng Evening News Group, which is run by the provincial government’s propaganda department, the SMH reported in 2009. He is also a member of a provincial body that advises the CCP, according to The New York Times.
In 2019, Chinese President Xi Jinping greeted Chau during a gathering of former global leaders in Beijing. China’s vice president, Wang Qishan, gave a keynote speech at an event Chau organized at a resort he owned in Guangzhou, the Australian Financial Review reported.
Australia was among the roughly one-third of the world’s countries that permitted foreign political donations. The United States, Canada, Britain and several European countries ban such donations.
The Times wrote in 2017 that Australia’s then “largely unregulated” campaign financing system had led to what critics said was “a culture of soft corruption that Chinese donors have learned to exploit alongside other corporate interests.”
In December 2017, then Australian Prime Minister Turnbull raised concerns about sophisticated political interference by foreign powers, specifically citing “disturbing reports about Chinese influence,” and announced that the country would ban foreign political donations.
The ban was passed into law in 2018.
That year, amid anxiety about Chinese influence, Australia also approved sweeping national security legislation. It criminalized any covert activity on behalf of a foreign government that aims to influence Australian politics and required foreign lobbyists to register on a public list.
In June 2020, Australian police raided the homes of New South Wales state lawmaker Shaoquett Moselmane and his political adviser, John Shi Sheng Zhang. The warrants alleged that Zhang, Chinese-born Australian citizen, engaged with Moselmane “through a private social media chat group and other fora ... to advance the interests and policy goals of a foreign principal,” the Chinese government, the Associated Press reported.
The raids became "the first police investigation to grab public attention since the foreign interference laws came into force in 2018," noted AP.
In May 2021, Zhang lost his challenge in Australia’s highest court over the validity of the search warrants executed by the police for the raid.
In November 2020, former Liberal Party member Di Sanh Duong, an Australian citizen of Vietnamese-Chinese heritage who served on the boards of several Chinese-Australian community groups, became the first person to be arrested under the new law. He was charged in Melbourne with “preparing for a foreign interference offense” and granted bail.
China has denied all the allegations of its influence activities in Australia, stating that it does not interfere in other countries’ affairs. It has also suggested that Australian’s new laws against such interference are motivated by xenophobia and racism.