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Foreign Policy

China-Australia Turnaround: Real?

Feb 07, 2023
  • Guo Chunmei

    Associate Researcher, Institute of Southeast Asian and Oceanian Studies, CICIR

Since the new Labor government came to power in May 2022, Australia seems to have changed its previous anti-China attitude and has demonstrated cooperative goodwill.

The new Albanese government has actively repaired relations with China, Australia’s largest trading partner, in response to public opinion and to boost the economy. With efforts on both sides,, China-Australia relations have improved significantly in just nine months.

Political dialogue has gradually restarted. China and Australia have engaged in a series of constructive talks, including a meeting between their leaders in Bali, a visit to China by the Australian foreign minister and the resumption of the long-discontinued China-Australia Diplomatic and Strategic Dialogue. Both sides reaffirmed the importance of the relationship and said they are ready to promote the comprehensive strategic partnership based on the principles of mutual respect, seeking common ground while reserving differences and mutual benefit. All this points the direction and clarifies the path for the development of the bilateral relationship.

Economic and trade cooperation is expected to be normalized. With the good political atmosphere, the Australian business community is looking forward to tapping the Chinese market. Australian coal shares rose in response to the news that China may resume Australian coal imports. A recent venture involved bids for Western Australia lithium developer Essential Metals by Chinese lithium giant Tianqi Lithium and Australian miner IGO. If successful, the bids will greatly boost confidence in Chinese investment in Australia.

Australian Minister for Trade and Tourism Don Farrell had planned a video meeting with Chinese Commerce Minister Wang Wentao to discuss ways to normalize trade.

People-to-people exchanges are poised for growth. After the COVID-19 pandemic and some ups and downs in relations, the two countries have made it clear that they will support their people-to-people exchanges, including track 1.5 dialogues and mutual visits of business delegations. With the easing of bilateral relations and the opening of borders, people-to-people exchanges are expected to be revitalized and bring huge benefits for the Australian education and tourism industries. 

Long way to go 

Since the Labor government took office, China-Australia relations have gotten off to a good start, but given the structural challenges facing Australia, continued stability and permanently improved relations are still a long way off.

Externally, Australia has been tied to the U.S. chariot as America’s ally. Militarily, the U.S. intends to make Australia a defense hub and forward base in the Indo-Pacific region, as well as continuing to expand its military presence in Australia’s northern region and arming Australia with nuclear capabilities. Economically, the U.S. is attempting to take advantage of Australia’s resources and location and work with it to build a supply and industrial chain at the expense of China.

As for regional mechanisms, the U.S. uses the AUKUS alignment, the Quad and the Five Eyes alliance to keep Australia in lockstep, while including it in a joint effort to contain China. As the China-U.S. rivalry becomes more long-term and complex, the Sino-Australian relationship will be tested.

Internally, in a now populist Australia, there is still a market for various versions of the “China threat,” and right-wing conservative forces are still on guard against any possible China-friendly initiatives by the Labor government, which could be labeled as appeasement. For this reason, the Labor government has to be careful and cautious in promoting cooperation with China. As Australian scholars say, the Labor government’s current goal is more to stabilize than to reset China-Australia relations. It is difficult to return to the old relationship. 

Test has just begun 

Based on the above difficulties and disruptions, after the successful promotion of constructive dialogue to set the tone for the resumption of cooperation between the two countries, the next phase of China-Australia relations is likely to be challenging. How can they translate the declaration of cooperation into practical action and concrete results? How can they uphold the original intention of establishing diplomatic relations and managing differences while continuing to move closer to each other? All this will become a common test for both countries.

Economic and trade exchanges are the anchor of China-Australia relations, and undoubtedly the touchstone. In the context of America’s unilateralist bullying practices, which undermine the rules-based international trading system, will Australia choose to act as a vassal and dance with the U.S. to interfere with and undermine trade cooperation with China? Or will it choose to work with China to maintain the stability of global industrial and supply chains as a supporter of free trade? This will greatly affect the process of normalizing trade relations between China and Australia.

In Asia, the Albanese government has made clear that it intends to return to Labor’s diplomatic tradition, emphasizing that Australian diplomacy should be diverse and integrated into Asia, rather than limited to the Anglosphere. In practice, however, it remains to be seen whether it can develop a balanced relationship with the United States and its Asian neighbors, and take practical steps to maintain regional peace and stability.

In the South Pacific, China has a long history of interaction with Pacific Island countries, and in recent years, as its overseas interests have expanded, it has become a natural process for China to increase cooperation with the island nations. Whether Australia can abandon its hegemonic mindset, accept and adapt to a greater Chinese presence and explore the path of win-win cooperation with China and Pacific Island countries will be an inescapable theme in Sino-Australian relations for a long time to come.

At present, China-Australia relations are setting sail once again in a stormy international environment, and the future is not straightforward. However, it is certain that more economic relations, people-to-people exchanges and regional cooperation based on mutual trust will enhance the stability and durability of the two countries’ relationship and help the boat of China-Australia friendship to break the waves.

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