A long-distance relationship

This week, Australian Prime Minister John Howard arrives in Beijing for a visit that includes a meeting with President Hu Jintao next Tuesday. Top of the list for discussion will be the results of a study jointly prepared by Chinese and Australian officials, which is likely to pave the way for the start of talks on a free-trade agreement.

But, no doubt, Mr Howard will want to lobby the Chinese to ensure that Australia gets a berth at the first East Asia Summit to be held in Kuala Lumpur later this year. And then there is the issue of rising tensions between China and Japan - a potentially difficult issue for Australia, given its 50 years of strong economic and strategic ties with Tokyo.

Australia's desire to move quickly to cement a free-trade deal with Beijing is built on the idea that China will be bombarded with bilateral trade requests over the next decade and it is in Australia's interests to try to be at the head of the queue.

The study that Mr Hu and Mr Howard will utilise as a basis for pushing talks forward is said to indicate that a free-trade pact would boost the Australian economy by A$3 billion ($18 billion).

As the Australian Financial Review noted last week, for the Chinese, such a deal is a 'form of treaty-level insurance of its long-term future supply of Australian resources to feed its hungry economic machine'. Australia is the biggest exporter of coal and aluminium in the world, the second-largest supplier of nickel and iron ore, and the third-largest producer of gold.

There are difficult political issues for both sides. From the Chinese perspective, Australia's strong agricultural export base may make the farming sector nervous. And Australian manufacturers, particularly of textiles, are a powerful lobby group that perceives a significant erosion of market share from Chinese imports.

And where does Australia fit within the nascent East Asian grouping of the 10 Asean countries plus China, Japan and South Korea? This group is meeting in Kuala Lumpur late this year, and a meeting in the Philippines this week will determine who gets invited to this historic conference.

There is no doubt that one of the aims of the East Asia Summit is to try to forge closer economic and security ties in Asia. The potential for a free-trade area in Asia is on the table, and Australia cannot afford to be left out of such a scenario.

So far, the views on Australia being invited are mixed, with Indonesia pledging its support, but Malaysia indicating that the Australian government's refusal to sign the Association of Southeast Asian Nations' Treaty of Amity that precludes any member from taking pre-emptive action against another, is a stumbling block to an invitation. Mr Howard will be hoping that Mr Hu can help on this matter. China might be able to use its leverage and power to lobby Asean members to rectify that situation.

But the fact that Japan agrees Australia should get an invitation will probably not impress Mr Howard's Chinese hosts. China and Japan's current squabbles over valuable energy resources that lie underneath the Diaoyu Islands, China's opposition to Japan's bid for a permanent seat on the UN Security Council, and Japanese suspicion over China's strategic intentions in the Asian region, are all being watched with increasing angst by Australia.

It does not want to have to choose between two nations that it regards as important economic and strategic partners in the 21st century.

There is much that binds Australia and Japan, but Mr Howard will be hoping this fact is not an obstacle to his country's desire to broaden its links with Asia's new superpower.

Greg Barns is a political commentator in Australia and a former Australian government adviser