The Regional Comprehensive Economic Partnership agreement sounded a rare positive note in deteriorating China-Australia relations. Both countries signed up for the world’s biggest free-trade area at a time when they could not agree on much else. But hopes of an early settlement of their escalating bilateral trade and political disputes were soon dashed. Australian media claims a document leaked by the Chinese embassy accuses Canberra of “poisoning bilateral relations” and lists 14 disputes, ranging from trying to torpedo the state of Victoria’s Belt and Road deal with Beijing to funding anti-China research. Separately, a Chinese foreign ministry spokesman also listed political issues behind the souring of ties including Australia’s criticism of China’s human rights record in Hong Kong and Xinjiang, its banning of Chinese companies from its 5G network and allegations of Chinese interference in domestic affairs. Australian Prime Minister Scott Morrison responded that Australia acted in its own interests and would not compromise its values or policies on issues such as investment, 5G and foreign interference. If there is a geopolitical factor that could prompt Canberra and Beijing to mend their relationship it could be change in Washington, with Joe Biden having signalled a foreign policy reset that could shore up certainty and stability in global affairs. That should be Canberra’s cue to reflect on current policy towards China and whether allowing the dispute to continue simmering serves the country’s best interests. Australia looks to China for trade and economic growth and to the United States for security. There is a failure by its politicians to reconcile geopolitical realities and strike a better balance. China cites litany of grievances with Australia, shirks blame for spat The 15-nation regional trade deal aimed at further liberalising trade in the Asia-Pacific, along with Biden’s election, does provide an avenue for improved relations. Australia’s economic well-being demands a reset to avoid wasting this opportunity. Soaring iron ore prices as China sought to reinflate its economy have softened the economic impact of the dispute on Australia. But it should not be lulled into complacency by volatile trade flows. The future shape of US power remains uncertain. Canberra needs to work harder to resolve and reconcile its internal conflicts over relations with China, and to improve understanding with Beijing.