Still, it's hard to see how Australia, which is committed to globalization and free trade, can reject a second foreign takeover. Spurning the SingTel offer would send a signal to investors that Australia is no longer open to business. SingTel has stressed that Australian jobs won't be lost. It's hoping to avoid antagonizing the xenophobic, anti-Asian One Nation party, which is picking up support among jobless Australians who have been disenfranchised by globalization. Most of Optus' operations are based in Sydney, a booming city that has benefited from the globalization trend.
Jobs are a fragile commodity there.
Local politicians seeking reelection in Woodside's home state pressured Canberra to stare down the Shell bid. And though free trade in Southeast Asia is still a long way off, Australia and Singapore don't want to be left behind. The outcome of the SingTel deal lies in the ongoing free-trade negotiations. Australia is pushing a reluctant Singapore to open its info-tech and communications sector. In the smoky backrooms where the discussions are being conducted, such issues could be thrashed out with a quid pro quo such as guarantee of a SingTel approval by Canberra.