Gas Infrastructure

The Hon. F. PANGALLO (14:51): I seek leave to make a brief explanation before asking a question of the Treasurer, as Leader of the Government, about the state's gas pipelines.

Leave granted.

The Hon. F. PANGALLO: The Treasurer and others in this place would be aware of the proposed $13 billion takeover of the APA Group, Australia's largest pipeline operator, by a consortium led by Hong Kong-based CK Infrastructure, also known as CKI. My diligent colleague in federal parliament, Centre Alliance Senator Rex Patrick, has serious national security concerns about the takeover bid on the grounds it would further expand Chinese control of Australia's vital energy infrastructure. He has written to the federal Treasurer, Scott Morrison, calling on him and the Foreign Investment Review Board to intervene.

If successful, the takeover would see the CKI-led consortium own $22 billion of energy infrastructure assets, stretching through every mainland state, including the substantial assets in South Australia of South Australia Power Networks (the former ETSA) and Australian Gas Infrastructure Group (the former Envestra).

My question to the Treasurer is: does the Treasurer and the Premier share the same concerns as me and my federal colleague Senator Rex Patrick in believing the potential sale of the APA Group to the CKI-led consortium could be prejudicial to our national security interests? Has the Treasurer and the Premier written to the federal government outlining concerns, requesting it to intervene in the process and block the bid, and, if not, why not?

The Hon. R.I. LUCAS (Treasurer) (14:53): I cannot speak on behalf of the Premier. I have not discussed the issue with the Premier, but in relation to my personal view, no, I do not share the view of the Hon. Mr Pangallo. I am comfortable in leaving these sorts of issues to the bodies and authorities that are given the power and the authority and the capacity to make judgements about these things, and that is the Foreign Investment Review Board.

We are not in a position in South Australia as a government or, indeed, as a parliament to make judgements about national security issues. Clearly, there are appropriate federal agencies that advise appropriate federal authorities, I assume, including the Foreign Investment Review Board. I am not sure exactly what the interrelationship is between the Foreign Investment Review Board and appropriate authorities at the national level, but there are obviously ways of accessing information that the Investment Review Board has, and they report to various federal ministers as well. It is at that level, in my view, that appropriate judgements can be made.

I have to say I don't—and I am not suggesting the honourable member does—start off with, as some in the community might have, a xenophobic view against Chinese investment. I am someone who was born not too far from China, in Japan. I don't start off with a view opposed to Asian investment, whether it be Chinese, Japanese or indeed any other country from Asia.

I think there have been concerns about companies which might be owned by or controlled by the Chinese government, and I won't mention any names but they have been commonly referred to. There have been issues raised at the national level in relation to their investment in certain strategic assets. Again, the appropriate authorities that have access to that sort of information are indeed the authorities at the national level.

But I don't start off with a default position which says that Chinese investment is bad. In fact, from South Australia's viewpoint, under the former Labor government, there was much encouragement. There was a conga line of ministers that went to China to encourage Chinese investment in industries in South Australia—and not just ministers but senior public servants, ministerial advisers and others.

Sensible, rational engagement with China as a trading partner, in the absence of any evidence to the contrary, is something that I personally support. I, however, accept that there will be occasions when the appropriate national authorities will say this is not in the national interest, whether it be for national security or for other reasons, as to why we shouldn't invest.

But I will not as a minister start off with a kneejerk, xenophobic response which says anything that has China or a Chinese company or a Chinese investment associated with it, in and of itself should be ruled out before somebody has made the appropriate decision at the national level in relation to whether there are issues of evidence in relation to national security. If that's the case, there are appropriate bodies to make those decisions and I will happily accept those particular decisions, but I am not going to rush to judgement as an individual minister in this government in relation to the issues the honourable member has raised.