China and Australia may bicker, but they will never actually divorce

John Power says even as Canberra sounds the alarm over Chinese interference, exchanges of goods, tourists and students are increasing unabated. It’s therefore no surprise that Australia wants nothing to do with the US trade war

PUBLISHED : Wednesday, 15 August, 2018, 2:00am
UPDATED : Wednesday, 15 August, 2018, 7:56am

Australian-China relations are going through something of a rocky patch. Ever since Australian Prime Minister Malcolm Turnbull proposed new laws targeting foreign interference, the two countries have stumbled from one public spat to another. 

When Turnbull singled out alleged Chinese meddling in domestic affairs as a justification for the legislation late last year, Beijing accused Australia, a key ally of the United States, of harbouring a “cold war mentality” and summoned its ambassador in protest. Then came reports that Beijing had started refusing visas to Australian ministers in retaliation.

Although Turnbull sought to play down claims of a deep freeze in relations, commentary in some Chinese state-run media suggested otherwise. In a pugnacious editorial published in May, The Global Times went as far as describing China’s relations with Australia as “among the worst of all Western nations”.

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Even as Australia and China have attempted to mend fences by ramping up diplomacy in recent weeks, new tensions have emerged. Last month, Australian Foreign Minister Julie Bishop expressed concern that massive lending by China to small South Pacific island nations could leave them burdened with unsustainable debt, threatening their sovereignty.

Bishop made it clear that Australia, which recently agreed to fund most of the cost of an undersea internet cable to the Solomon Islands specifically to prevent Chinese involvement, saw itself as the natural partner of countries in the region.

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China’s foreign ministry fired back at the “wrong remarks of the Australian side”, insisting it was assisting the economic development of independent nations in accordance with their wishes.

With all this bickering lately, it might seem like Australia and China, which have had formal diplomatic ties since 1972, are on the verge of becoming outright enemies, if they aren’t already.

Although the headlines make it easy to forget, the fact remains that the two countries are trading goods and services, carrying out people-to-people exchanges and cooperating on a scale never seen before.

If this is a couple that fights a lot, it’s one that doesn’t seem likely to sign divorce papers any time soon.

China and Australia need each other. Just look at the economic numbers. Australia’s exports to China amounted to A$110 billion (US$79.9 billion) in 2016-2017, an astonishing 30 per cent of the total.

Although they are engaged in a war of words, the value of China’s imports from Australia, mostly resources, actually grew 37 per cent last year. And despite a drop-off resulting from a tightening of foreign investment rules, Chinese investors spent more than A$15 billion on property in Australia, more than twice the amount splashed by Canadians, the second-biggest spenders.

People flows tell a similar tale. A record 1.36 million Chinese visited Australia last year. Meanwhile, more than 170,000 Chinese enrolled in Australian educational institutes in the first half of 2017 – more than double the number of Indians, the next biggest cohort of international students.

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As a result of Australia’s large migration programme, no fewer than 1.2 million Australians now claim Chinese descent.

There is considerable debate in Australia about whether it will eventually have to choose between China and the US, two crucially important partners that increasingly appear to be in direct competition.

So far, Australia’s approach has been not to choose at all, reaping the respective security and economic benefits of close relations with both Washington and Beijing. There’s little indication that Canberra has any intention of upsetting this balance any time soon.

And why would it? It has worked well for the country so far. Tellingly, Australia has shown no interest in joining Donald Trump’s trade war with Beijing, despite echoing Washington’s policy line on issues such as the South China Sea.

As prime minister, Tony Abbot once memorably summed up Australia’s relationship with China as characterised by “fear and greed”.

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It’s easy to imagine that Chinese officials, in their more candid moments, might admit to harbouring similarly ambivalent sentiments about their antipodean partners.

Such tepid feelings aren’t quite the foundation for a warm friendship. They are, however, likely to be more than sufficient to prevent the two countries from ever truly falling out.

Like the constantly quarrelling couple that everyone knows is in it for the long haul, they need each other.

John Power is an Australia-based journalist