Chinalco lost Rio bid to Australian paranoia

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By Antonio Castillo (China Daily)
Updated: 2009-06-19 07:46

Chinalco's failed bid to increase its interest in the Australian mining company, Rio Tinto, should be probed not only from a financial point of view but also from another perspective: the culture of paranoia and fear entrenched in the Australian psyche. This is especially the case when it comes to Asia, and in particular to China.

Paranoia and fear framed Chinalco's bid. "It is the Chinese Communist Party that wants to buy a big chunk of Australia's resource heritage," read a hysterical letter to the Sydney Morning Herald. This was a view echoed by the Opposition Leader Malcolm Turnbull who said the deal was against national interest because Chinalco was controlled by the Chinese Communist Party.

The Australian media - a magnifier of Australian paranoia - ran an endless stream of negative stories, and most of them were preceded by the word "controversial". Paid advertisements advocating that the government reject the deal were run prominently in The Australian and The Sydney Morning Herald.

In a recent article, respected journalist and author David Marr wrote about Australia's concern and nervousness when it comes to China. Australia is worried, he wrote, that "China might come to control our resources". Australians are "haunted by a fear of invasion that stretches back more than 150 years, to boats full of Chinese bound for the goldfields turning up in Port Phillip Bay", he wrote.

This is the way the failed Chinalco bid was constructed. It was not a boat full of Chinalco's officials bound for the mining fields of Australia. Rather it was the "yellow peril" revisited. According to an opinion poll, six out of 10 Australians opposed Chinalco's bid. It is most likely that the opposition was not based on financial analysis. It was a muddle of paranoia and fear.

It was in this toxic environment that Chinalco's bid was played out and reached hysterical levels. Tony Abbot, one of the acolytes of former prime minister John Howard, a well-known anti-Asian Australian leader, accused Beijing of deploying in Australia a vast network of spies.

And, the media jumped into the paranoia bandwagon reporting Australian government officials - including Prime Minister Kevin Rudd and his former defense minister Joel Fitzgibbon - as being "caught up" in "undisclosed" meetings with "high ranking-Chinese". It's hardly secretive when you have a highly visible convoy of Chinese dignitaries heading to Canberra, the Australian capital.

China is Australia's largest overall trading partner. It is the second largest export market for goods, and the third largest market for services. It is also the largest source of international students enriching the university coffers. Let's say a lot of Australia's prosperity is thanks to China's need for natural resources. But this doesn't soothe Australia's paranoia about China.

The Australian paranoia has reached preposterous levels. Even speaking Mandarin can be seen as a contributing cause. Prime Minister Rudd is fluent in Mandarin and this has become a liability. More frequently than not, the media has referred to him as "our Mandarin-speaking Prime Minister". And it has not been a laudatory tone.

Prime Minister Rudd doesn't like to be seen as "Australia's most China-friendly prime minister ever", as described by Andrew Fraser, a journalist at Rupert Murdoch's newspaper, The Australian. This "too close to China" narrative is making Prime Minister Rudd uncomfortable.

Paranoia is not new and has always occupied center-stage in the collective psyche of white Australia, wrote Prof Ghassan Hage in his Against Paranoid Nationalism: Searching for Hope in a Shrinking Society in 2003. Hage, one of the most respected Australian intellectuals, observed that white Australians are obsessed with paranoid fantasies about foreigners seizing control of the country.

And, while the Australian paranoia is usually against the foreigner - the non-white, of course - its native habitants have also experienced it. It was not long ago that the landmark 1993 Mabo decision - whereby indigenous Australians' pre-existing land was recognized - was described by Hugh Morgan, then president of the Western Mining Corporation, as a factor that would leave Australia open to "external threats".

By the way, Western Mining Corporation was bought in 2005 by BHP Billiton, the company that Rio Tinto is proposing as a joint venture partner after turning its back on Chinalco. It is fair to say that in this Australian toxic paranoia, the Chinalco bid never had any chance of succeeding.

The author is a journalist and an academic at the University of Sydney.

(China Daily 06/19/2009 page9)