Australia’s decision to ban a well-connected Chinese businessman for his political activity is being seen as a potential watershed moment, the start of pushback against Beijing’s long-running operations to buy influence overseas.

In less than a decade, Huang Xiangmo went from a new arrival in Australia to hosting swanky waterside parties with political elites, to finally being kicked out of the country and declared persona non grata — as a result of his alleged links to China’s Communist Party.

Huang Xiangmo
Huang Xiangmo. Photo: YouTube screenshot.

The 49-year-old Guangdong native is currently believed to be in Hong Kong, after the same officials he long courted and bankrolled revoked his residency, denied him citizenship and prevented him from returning to his multi-million-dollar Sydney mansion.

Experts say his case — which has prompted a furore in Australia over foreign donations to political parties — is a signal that Canberra is ready to curb China’s ambitious operations to influence foreign political elites.

“It’s a very significant thing,” said Michael Shoebridge, former deputy director of Australia’s defence and signals intelligence agencies, pointing to Huang’s links to the Chinese Communist Party.

While the 2016 US presidential election shone a fierce spotlight on Russian intelligence agencies’ “active measures” to influence and subvert events abroad, less focus has fallen on China’s operations in the same area.

According to Shoebridge, these are often led by the United Front Work Department, an agency of the Communist Party, and offshoot groups set up around the globe, like the Australian Council for the Promotion of the Peaceful Reunification of China.

Australian Parliament, Canberra
Australian Parliament, Canberra. Photo: Tom Grundy/HKFP.

While the United Front Work Department operates in China with close ties to party leaders, the reunification councils have been established in countries from New Zealand to the United States.

The lack of a formal link between the groups abroad and the Chinese state allows “deniability”, according to Shoebridge. “But they certainly implement the policy directions of the Chinese state.”

Their work also focuses on shaping public opinion and policy on contentious issues like China’s claims on Taiwan, the South China Sea, Tibet and on internal issues like the treatment of ethnic Uighurs.

In a sign of their importance, President Xi Jinping met Huang in Sydney in November 2014 during a state visit.

Xi Jinping
Xi Jinping. File photo: S.Africa Gov’t.

It was Huang’s political influence and his links to the United Front Work Department that reportedly set off alarm bells for the Australian Security Intelligence Organisation, the country’s main spy agency.

“Huang was very active in promoting United Front Work and in getting close to politicians,” said Gerry Groot, a China expert at the University of Adelaide.

His interests included the 2015 Australia-China free trade agreement and a contentious bilateral extradition treaty, according to local media reports.

In 2017, one-time opposition Labor powerbroker Sam Dastyari was forced to quit politics amid allegations that he informed Huang about monitoring by western intelligence agencies and that his office took cash from the billionaire to pay legal bills.

Millions more went to Australian political parties of all stripes.

Fallout or buildup 

Australia’s foreign minister, Marise Payne, played down the significance of Huang’s de facto expulsion for the broader China-Australia relationship.

“I don’t expect it to be the subject of a bilateral discussion. These are matters that occur from time to time,” she said.

The Chinese authorities have yet to react to news of the ban.

Beijing has often dismissed claims of meddling as hysteria and paranoia, but experts expect a muted Chinese response, so as to avoid negative publicity or draw further attention to United Front work.

“Any individual is disposable,” said Shoebridge.

But officials across the Pacific will be looking to see whether it is a precursor to further expulsions or even prosecutions.

Australia’s decision to ban Huang from the country “sets a precedent”, said Groot, adding it is something of a test case. “It will allow the Australian government to find out how Beijing will respond.”

Last year Australia passed sweeping national security reforms via the Espionage and Foreign Interference Act, which broadens the range of activities that would be treated as spying.

So far that legislation has not been used for prosecutions.

“Beijing has been surprised that it has got away with the kind of influence operations it has been running for so long, and have been so effective,” said Shoebridge.

“Australian policymakers have woken up late to these activities, but this is a sign that the rhetoric now has substance. Another big sign of that will be the first prosecution.”

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