People-to-people exchanges build understanding and trust between nations. The chill cast over them between the United States, Canada and China with detentions for alleged security violations has spread to Australia and its relations with its biggest trading partner and investor. Canberra has revoked the permanent residence of billionaire developer, China lobbyist and political donor Huang Xiangmo while he is abroad. The decision, reported to have been taken on security advice that he was “amenable to conducting acts of foreign interference”, and after political parties had been warned against accepting donations, is likely to deter investment and exchanges. Huang has described the decision as inconsistent with Australian freedom, democracy, rule of law and fairness, and denied any legal violation. There is no suggestion of illegality and major political parties see no need to take up Huang’s offer to accept the return of donations amounting to nearly A$3 million (US$2.13 million), which he says were made at their request before a recent overhaul of laws against foreign interference. There were also lavish gifts to universities and the founding of a China-Australia think tank. But Huang had long been under scrutiny over alleged links to Chinese Communist Party efforts to extend political influence abroad. The political and economic fallout will be measurable. But there is no accounting for the negative effect on people-to-people relations if Chinese and Australians are made to feel unwelcome in each other’s country. It will surely not be lost on Chinese investors and migrants. It is not clear that this is what Australia wants. After all, what Huang did may be seen as no more than what businessmen from other ethnic backgrounds have been encouraged to do – exercise their right to political participation in their new country. Chinese billionaire hits back at move to cancel Australian residency Any country has the right to decide who can enter its territory. Huang’s is no ordinary case, but his use of donations to gain access to influential politicians is an approach commonly adopted by businessmen trying to overcome obstacles. His lobbying for China was not illegal, even if it is usually the work of accredited diplomats. But media and public perceptions became more critical with the disclosure that one of his companies settled a legal debt for a Labor politician, who warned him his phone was likely to be tapped. Huang, who owns a family mansion in Sydney, may be able to challenge the ruling in the administrative appeals tribunal. The government is unlikely to elaborate publicly on a national security matter. That does not prevent a general explanation of interference activities seen to pose a security risk to alert people to them. Migrants, businesspeople and libertarians will be watchful for any erosion of the political and civil freedoms that encourage Chinese to invest and make new lives far from home.