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Has Australia Come Out on Top in Dispute With China?

Australian Prime Minister Anthony Albanese wrapped up a four-day visit to China on Tuesday, as Beijing and Canberra continue work on repairing frayed ties.

During a highly anticipated meeting with Chinese President Xi Jinping on Monday, Albanese described the progress this year in restoring trade ties as “unquestionably very positive” and “to the benefit of both countries.”

China-Australia relations began to deteriorate in late 2017, after Australia accused China of foreign political interference, which included claims of influence peddling by Beijing-linked donors. High level diplomatic meetings were put on ice, and Australia became one of the first countries to ban China’s Huawei and ZTE from building 5G infrastructure.

Tensions were exacerbated in 2020 during the coronavirus pandemic after Australia called for an independent inquiry into the origins of the virus, to which an angered Beijing responded by slapping $13-billion (€12.2 billion) worth of import curbs on Australian timber, coal, barley, lobsters and wine.

China, Australia seek a reset

The election of Albanese’s center-left labor party in 2022, replacing the conservative government of Scott Morrisson, provided a political opportunity for a reset.

In November 2022, Albanese and Xi met on the sidelines of the Group of 20 summit in Bali, the first formal meeting between the leaders of China and Australia in six years.

The foreign ministers of the two countries met in December 2022. China’s unofficial ban on Australian coal imports was lifted in March 2023, the de-facto ban on timber was removed in May. Barley followed in August.

Australian Trade Minister Don Farrell on Saturday said he expected the remaining impediments on Australian seafood and red meat products to be removed soon.

Albanese’s visit to China is the first by an Australian head of state in seven years. He said his visit would focus on Australia’s interests in trade, human rights and strategic issues.

“While there are differences between us, both Australia and China benefit from cooperation and dialogue,” he said, adding that both countries had agreed to cooperate on trade, climate change and agriculture.

Prior to the Xi meeting Monday, Albanese said that Australia needs to “cooperate with China where we can, disagree where we must, and engage in our national interest.”

Albanese highlighted the importance of maintaining high-level dialogue and people-to-people links in his opening remarks. “Where differences arise, it’s important that we have communication,” he said. “From communication comes understanding.”

Xi said the bilateral relationship “has embarked on the right path of improvement and development,” adding the meeting with Albanese “builds on the past and ushers in the future.” 

Did China’s trade war backfire?

Despite Albanese’s careful diplomatic language defining his country’s current relationship with China, Australia looks to have emerged relatively unscathed by China’s tough trade policy.

After an initial slump, the trade barriers didn’t stop Australia from finding other markets for many of the goods China banned. And despite the trade barriers, China has remained Australia’s biggest trading partner.

Reuters columnist Clyde Russell wrote that Albanese’s election “allowed for Beijing to retreat from a policy that clearly hadn’t worked.”

“Canberra didn’t bend to its [China’s]diplomatic will and Australian farmers and miners were able, after an initial period of adjustment, to find new markets for their products, often at higher prices.”

And after the “trade war,” ostensibly began, overall trade between China and Australia remained steady in 2020, mainly driven by iron ore imports, which China found difficult to replace.

“The primary lesson of Australia’s 2020 export experience was that the economic weapons China fired were blunted by the multilateral trading system,” economist Shiro Armstrong wrote in an article published on the East Asia Forum.

Australia also holds a veto over China’s ambition to join a regional free trade pact, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

“Australia is unlikely to support China’s application to accede to the CPTPP while trade impediments still remain, such as restrictions on wine, lobster, and a range of beef products,” said Elena Collinson, manager of research analysis at the Australia-China Relations Institute.

Little has changed in Australia’s China policy

However, experts say Australia will be careful moving forward in defining outcomes and policies, in order to keep relations with China on an even keel.

“What we have seen is a change in the tone of how the government engages with China. They are very careful not to let any hostility show, at least in public,” said Ryan Neelam, director of the public opinion and foreign policy program at the Lowy Institute in Sydney.

“But when you look at the substance of those policies and the actual way that Australia looks towards China, there hasn’t been a huge shift,” he told DW.

“If you look at Australian policy from the time of the Albanese government’s election in 2022, very little has changed in terms of the substance of the issues that China objected to,” Neelam added.

For example, Australia continues to support the United States in containing China’s growing military strength in the Pacific, especially the South China Sea.

This includes joining AUKUS, a trilateral defense partnership, which includes transferring nuclear submarine technology, with the US and UK. Beijing frequently bristles at Australia’s strategic cooperation with the US as “anti-China.”

During his meeting with Xi, Albanese said he emphasized the need for peace and security in the Asia Pacific region. “I spoke about guardrails and military-to-military cooperation between the United States and China; that’s important,” he told reporters.

Neelam from Lowy Institute said he expected Albanese set markers during the closed-door meeting with Xi about what Australia continues to see as key challenges, including the ongoing detention in China of Chinese-Australian blogger Yang Hengjun and China’s military posture in the Indo-Pacific.

“The mode of how he engages on those issues will be important,” he told DW. “We will probably see continued positive messaging when it comes to the public statements but the really difficult issues will be raised in private when he meets Xi,” Neelam added.

Collinson from the Australia-China Relations Institute told DW that Albanese’s diplomacy has helped to create “an off-ramp towards the stabilization of relations” between Beijing and Canberra.

“The Albanese government has shown a particular adeptness as expectations management, ensuring the relationship is managed with precision and not getting too far ahead in terms of closer ties,” she said.

Source : DW