Who benefits the most as Australia-China ties warm up?

By Riyaz ul Khaliq

ISTANBUL (AA) – Looking satisfied after his four-day visit to China, Australian Prime Minister Anthony Albanese acknowledged that the relationship with Beijing “strengthen our economy, supports jobs and business.”

Albanese’s trip to China earlier this month was the first by any Australian leader in seven years, marking what experts see as the start of a possible overhaul of bilateral relations.

Critically, analysts say, this reorientation under the Albanese government is being pursued without Australian giving into any of China’s core demands.

John Lee, director at East West Futures Consulting, told Anadolu that Australia’s basic strategic settings with regards to China “have not changed.”

“It is not evident that the Australian government has made any significant concessions to China, despite this being claimed by certain Australian commentators,” Lee said.

The primary tweak, he explained, has been that “the messaging has been adjusted to be less antagonistic to China.”

Australian businesses felt the heat when relations went off the bilateral track under former Prime Minister Scott Morrison, losing at least $13 billion every year due to trade restrictions imposed by Beijing.

Now, the policies of the Labor government led by Albanese, combined with the “failure of Chinese trade restrictions on Australian exports to achieve the desired effect and China’s desire for Australian cooperation on certain issues such as TPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) accession, is what has produced the thaw,” according to Lee.

- Security or economy?

Australia is part of the US-led Quad alongside Japan and India, while also having signed the AUKUS trilateral pact with Washington and the UK to procure nuclear-powered submarines.

China has used all opportunities to condemn AUKUS, which has been described by its allies like Sri Lankan President Ranil Wickremesinghe as “a military alliance formed against China.”

Einar Tangen, a Beijing-based political commentator, said the AUKUS agreement “angered” China.

However, he said the Albanese government has “taken a more pragmatic view of trade with China, while balancing its security ties with Washington,” marking a “departure from Morrison’s ideological adherence to America’s policies.”

He said the US has “a constant presence in Australia,” which it masks with a “values” rhetoric.

“But the reality is Canberra identifies more with its colonial past than its geographical setting,” said Einar.

David Andrews, a senior policy adviser at Australian National University, pointed out that Australia is “still opposed to Chinese militarization of maritime features in the South China Sea (and) is still wary of China’s attempts to build favor and political influence in the South Pacific.”

That is what is driving Canberra’s “concerted effort to apply a greater degree of statecraft and diplomacy to Australia’s foreign policy,” he explained.

For policymakers in Australia, Canberra’s ties with Beijing have two primary factors: security and trade.

“(There is) fear of geopolitical rivalry and/or threat, interposed with the greed that comes from great economic potential,” said Andrews.

For Australia, Andrews said, managing these tensions “has been a constant diplomatic challenge for over a decade now.”

Australia’s alignment with the US is “not surprising,” he said, pointing out that the country has “historically managed its security alongside a great power ally, specifically the dominant global maritime power.”

“As an island continent, geographically isolated from its friends and partners, this is part of Australia’s ‘strategic psyche.’ For the first time in many years, there is a perceived threat to Australia emanating from within its region,” he said.

“That has translated to a greater focus on defense and security policy, and attempts to improve domestic political and societal resilience.”

- Why relations derailed

Analysts attribute the downturn in bilateral ties to a range of factors, from Australian pushback against Chinese actions in the South China Sea, AUKUS and other military deals, and Canberra’s call in 2020 for an international investigation in the origins of COVID-19.

Andrews said the policy toward China under Scott Morrison was “not an unreasonable choice,” as Australia gave priority to security over economics and diplomacy due to regional geopolitical tensions.

Now, though, both sides realize that the economic relationship “is of great significance” for either side, he added.

China has been Australia’s largest trading partner since 2009 and its largest market for supplies such as iron ore, natural gas, gold, copper, coal, wheat and wool.

The world's second largest economy is also Australia’s largest source of imports, primarily in manufactured goods and technology.

As Einar explained, it was the demand from the Chinese market “during the 2008-09 financial crisis that spared Australia from the global recession that followed.”

He said a primary issue in China-Australia ties has been “the US WWI-era containment strategy, of which Australia is now part of.”

“The US has pushed a false narrative that China seeks to change the world, rather than the truth, which is China has been the driving force of global growth since the early 2000s. A reality that has seen Australia prosper,” he said.

Building on that point, Andrews stressed that China’s centrality to Australia’s recent economic success makes their bilateral economic ties “an important part of Australia’s domestic political conversation.”

On the flip side, Australia has also played a “crucial role in China’s economic growth,” he added.

Following the downturn in relations, China imposed “informal economic sanctions on Australia across several market sectors, including barley, wine, coal, lobster, and timber,” Andrews said, using former Australian Prime Minister Tony Abbott’s description of relations with China being “governed by fear and greed.”

“This, unsurprisingly, had a profound impact on the Australian political discourse and led to questions over the government’s handling of the bilateral relationship,” he said.

- ‘Negative coverage around China’

A multicultural country with a long history of migration from all across the globe, 28% of Australia’s population is made up of people who were born overseas.

According to a 2021 census, 48% of its people have at least one parent who was born overseas.

In that, those with Chinese ancestry form the largest group, followed by the UK.

Australia saw its largest period of migration in the 1970s, while Chinese migrants have been coming to the country since the 19th century.

According to Lee, the East West Futures director, the ethnic Chinese community “generally has not had major issues with wider Australian society” since the 1970s onward.

“But the amount of negative media coverage around China for the past decade has raised concerns for many in the community, and there has been a rise in abusive behavior towards people of Chinese (or East Asian) appearance, especially since the COVID-19 pandemic,” he said.