China-Australia ties face new hit as Canberra gets veto on foreign deals

Australian parliament votes in new law that allows foreign minister to scrap agreements between foreign nations and state and territory governments
Law is widely seen as aimed at deals involving Beijing, including Victoria’s controversial agreement to participate in the Belt and Road Initiative

China-Australia relations

John Power

Published: 1:43pm, 8 Dec 2020

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Australia’s parliament on Tuesday voted to grant Canberra new powers to tear up agreements signed with foreign countries, after Beijing warned the proposals were among a raft of issues “poisoning bilateral relations”.

Under the new law, Australia’s foreign minister will be able to scrap agreements between foreign nations and subnational bodies such as state and territory governments, local councils and universities where he or she believes they undermine foreign policy.

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Foreign Minister Marise Payne said the legislation would ensure agreements were consistent with Australia’s foreign policy in an “increasingly globalised world”.

“This increased engagement, and the growing strategic complexity of the 21st century, brings greater risks, requiring more consultation and due diligence to ensure states and territories are aligned with the Commonwealth’s foreign policy,” Payne said.

The passage of the legislation is likely to further aggravate Australia’s rocky relations with China after Beijing included it on a list of 14 grievances that it said were responsible for “poisoning” ties.

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The list, released last month through the Chinese embassy in Canberra, also included Canberra’s 2018 ban on Huawei’s involvement in 5G and “antagonistic” media reports about China.

On Thursday, the state-run Global Times published an op-ed decrying the likely passage of the legislation as reflecting Australia’s “abnormal state of political madness and paranoia”.

“It certainly is not going to help alleviate the current [fight] between the two governments but as Beijing has the right to decide the scope of China’s engagement with foreign countries, so does Canberra,” said Nathan Attrill, a researcher at the Australian Strategic Policy Institute, which is part-funded by the Australian, US and British governments.

“This is an issue of Australian federalism as much as a reshaping of foreign affairs.”

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Attrill said reports of research collaboration with institutions or scholars with links to the People’s Liberation Army had shown a “lack of due diligence – or perhaps wilful ignorance – on the part of these organisations that clearly needed to be addressed somehow”.

Sino-Australians relations have been in a downward spiral since April, when Canberra infuriated Beijing by proposing an independent international inquiry into the origins of the Covid-19 pandemic.

Beijing has in recent months slapped restrictions on billions of dollars of Australian exports, including beef, barley and wine, citing dumping and other trade violations that analysts widely view as pretexts to inflict economic retaliation.

The image posted on social media by Zhao Lijian. Photo: AAP Image

Ties soured further after Chinese Foreign Ministry spokesman Zhao Lijian last week posted a photo illustration on social media of an Australian soldier holding a knife to the throat of an Afghan child – a reference to a recent report detailing evidence of Australian war crimes in Afghanistan – drawing a furious response from Australian Prime Minister Scott Morrison.

Although Canberra has denied targeting any particular country with the foreign relations legislation, it is widely seen as aimed at deals involving Beijing, including the state of Victoria’s controversial agreement to participate in the Belt and Road Initiative. Australian government officials have declined to confirm if the state’s agreement on Beijing’s cross-continental infrastructure drive faces the chop, insisting all deals will be assessed through “proper processes”.

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The proposals had faced significant blowback from state politicians and industry figures, who warned the changes would damage business confidence and added needless bureaucracy to engagement.

The tertiary education sector also raised concerns, with university peak body Group of Eight this year warning the proposals “may not be proportionate to risk”.

Melissa Conley Tyler, a research fellow at the University of Melbourne-based Asia Institute, described the law as “profoundly misguided”.

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“When things are difficult at a political level is precisely when you need to maintain other connections,” Conley Tyler said. “Putting a Commonwealth veto over international arrangements by councils, state governments and universities means they can’t provide positive engagement to help ride out diplomatic storms. The new legislation creates a further trigger for worsening Australia-China relations. Its long-term legacy will be to intensify an atmosphere of suspicion.”

This article appeared in the South China Morning Post print edition as: Canberra wins foreign deals veto

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