Poor logic in Australia's move to block grid bid

Australia has been a favorite destination for Chinese investors because of its abundant resources and geographic proximity to China. But since the mid-2000s Australia has rejected a number of Chinese investments - some because of procedural rules, others on national security grounds. In response, Chinese companies have been studying their potential targets in detail to avoid a clash of interests with the host government.

In the latest such move, Australia's Federal Treasurer Scott Morrison said the government would veto, again on national security grounds, two Chinese companies' $7.7 billion bid to buy the controlling stake in the country's biggest energy grid, AusGrid. Morrison's decision was applauded by politicians in Australia as well as the United States, even though the US is unlikely to ratify any time soon the Trans-Pacific Partnership that was signed in February and benefit from the move.

Later, Reuters quoted Australia's foreign investment review board chairman Brian Wilson as saying that blocking the grid sale was "not a politically influenced decision. It is a result of a confluence of events".