China may buy into ASIS web of secrets By Craig Skehan, Foreign Affairs Correspondent June 8 2002 A Chinese company with close links to the Peoples' Liberation Army could end up with the contract for the communications network used by Australian diplomats and the Australian Security Intelligence Service. This includes encrypted messages with the highest security classifications - "Ultra" and "Oyster". The prospect of a Chinese company owning or part-owning the communications lines for Australia's secrets and information provided by allied intelligence agencies such as the CIA is not without irony. In 1995 the Herald revealed that Australian intelligence operatives - in a joint operation with the US - had installed fibre-optic bugging devices during construction of the Chinese Embassy in Canberra. A Foreign Affairs Department spokeswoman yesterday acknowledged that China Netcom was one of several companies interested in buying into Asia Global Crossing, which has already been contracted to provide the Australian communications system. AGC is 58 per cent owned by its United States-based parent, Global Crossing, which faces restructuring because it is over $12 billion in debt. Communications industry trade publications have reported that China Netcom is planning to take over AGC. The Foreign Affairs Department said last night it would not "lose control" of its telecommunications network through changes in ownership. As well as encryption, the Department had "contingency plans to maintain our network coverage in the unlikely event of any links being disrupted by an AGC restructure". A departmental spokeswoman maintained that potential investors would have no interest in undermining any investment in AGC by "compromising the integrity of the network". "We were aware of the financial situation of both AGC and its parent, Global Crossing," she said. "We looked very closely at the implications of this and structured a contract with AGC which protects us from the consequences of a change in its ownership." This is a reference to what the department claims are escape clauses in the current confidential contract. However, the Federal Opposition's foreign affairs spokesman, Kevin Rudd, himself a former Australian diplomat who served in China, said last night that the Government needed to explain exactly what checks it had made before signing the contract with AGC last month. He noted that the contract had been entered into despite the debt problems and planned restructure of the parent company. "They did not appear to be aware of the possible sale of AGC until it was revealed in the media," Mr Rudd said. In August 1999, China Netcom was founded by entities affiliated with the Chinese Government. They included the Chinese Academy of Sciences, which is very closed linked with the general armaments division of the People's Liberation Army. China Telecom already has some commercial relationship with AGC, including its recent acquisition of communications links between Hong Kong and Los Angeles. END http://www.smh.com.au/articles/2002/06/08/1022982773279.html The PM was today congratulating Labor for being first in to China,(pre Nixon)