An Australia that can say no
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Apr 8th 2017
IF THERE’S anything worse than running a huge trade deficit with China, it is, to judge by Australia’s incessant fretting, running a huge surplus. Australia’s was A$22bn ($17bn) last year—1.3% of GDP. China’s industrial revolution has long been fuelled by coal from Queensland and iron ore from Western Australia. But China wants ever more from Oz. Education, for instance: nearly 160,000 Chinese are studying in Australia. Food and drink is the next boom. Annual exports of beef will soon exceed A$1bn. Restaurants in Beijing and Shanghai can’t get enough Australian lobster. And sales of Australian wine to China were nearly A$500m in 2016, and growing by 50% a year.
So what are Australians worried about? Their country has escaped recession for an astonishing 25 years, thanks chiefly to Chinese demand. And Australia never had a big manufacturing sector to be hollowed out by Chinese competition. Yet nervousness is growing that Australia is somehow beholden to China, a feeling exacerbated by China’s testy reaction whenever Australia does anything that displeases it.
The testiness is especially acute when Australia appears to side with America, its closest ally since the second world war. Last July an international tribunal ruled against China’s sweeping territorial claims in the South China Sea. In response, Australia issued a bland statement emphasising the importance of a rules-based maritime order and expressing opposition to any action that might increase tensions. China reacted furiously. Global Times, a state newspaper, described Australia as an American toady “with an inglorious history”, not even a paper tiger but “a paper cat at best”. “Australia’s power,” it thundered, “means nothing compared to the security of China.” If Australia meddled, it would be “an ideal target for China to warn and strike”.
Some Australian commentators seem to think that the best response to such bluster would be to take even greater care to avoid riling China. When Australian officials make anodyne statements of support for America or mild criticisms of China, they sometimes still earn worried rebukes at home. When the foreign minister, Julie Bishop, called last month for America to remain “the indispensable strategic power” in the region, it was gentle stuff—a reiteration of seven decades of settled policy. Hardly controversial, either, were her remarks in favour of a liberal international order: “While non-democracies such as China can thrive when participating in the present system, an essential pillar of our preferred order is democratic community.” Yet Geoff Raby, a former ambassador to Beijing, condemned the speech as “peculiar” and “odd” coming just before a visit to Australia by China’s prime minister, Li Keqiang.
On occasion, the government itself seems equally eager not to offend. During Mr Li’s visit, authorities in China detained Feng Chongyi, a Chinese academic who lives in Australia and has criticised China’s persecution of human-rights lawyers. In public, at least, Mr Turnbull was shamefully silent over the case, even though the Australian media was in uproar. In fact, Mr Turnbull even tried to push ahead with a parliamentary vote to ratify an extradition treaty with China. A previous conservative government had concluded the treaty ten years ago. Chinese authorities had been piling on the pressure to ratify it. Ms Bishop kept defending the treaty doughtily, even as the predicament of Mr Feng drew attention to the glaring flaws in China’s legal system.
But even if the government was keen to ingratiate itself with China by ratifying the treaty, Australia’s parliament was having none of it. A loose alliance of opposition parties and rebellious MPs from the ruling coalition indicated they would vote it down, forcing the government to call off the vote days after Mr Li’s departure. That is not the only time Australia has tied itself in knots over its dealings with China. Every time a Chinese firm tries to buy a big Australian business, be it a power company or a cattle station, the government hums and haws over whether the purchase should be blocked, with little consistency.
China, of course, has few qualms about pushing Australia around. Some of those Chinese students, for instance, jump to the orders of the Chinese embassy when shows of patriotism are required. On university campuses they vociferously oppose anything deemed critical of the Communist Party. Rent-a-crowds materialise to denounce the Dalai Lama. Patriotic Chinese businesses have made donations to Australian politicians, apparently in the hope of securing a friendlier diplomatic stance. And China is not above using its commercial clout to punish countries that anger it, even if it rarely makes the threat explicit. South Korean firms doing business in China are currently suffering boycotts and bureaucratic persecution because their government had the cheek to allow the deployment of an American anti-missile system that the Chinese government is unhappy about.
Standing up to China is made all the harder by doubts about the strength of America’s commitment to Australia in particular and Asia more broadly: Donald Trump is both unpredictable and sceptical of alliances (and he famously hung up testily during a recent call with Mr Turnbull). More than at any time since at least the second world war, Australia feels vulnerable.
Yet just as it makes little sense any longer to subordinate Australian policy unquestioningly to America, it makes even less sense to fall in with all Chinese demands. Giving way to bullying, after all, only tends to encourage it. Allan Gyngell, a former intelligence chief and author of a new book on Australian foreign policy, “Fear of Abandonment”, does not think dealing with China needs to be “all that difficult”, so long as Australia is prepared to approach China “with clear eyes”. Wouldn’t it be nice, adds a former colleague of his, if Australia just said “no” to China from time to time, and made it clear that it was prepared to bear the cost?
