Australia’s China awakening broadens

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Some good pieces today on China at Domainfax. The first is by Brendan Sargeant an honorary professor at the Strategic and Defence Studies Centre, Australian National University at the AFR:

This is a slow-moving crisis that will not be settled quickly because it involves the negotiation of the Indo-Pacific strategic order. We can expect more problems across the full spectrum of the relationship, as will other countries in our region. It would be surprising if this were not to be the case.

…China is a state with very different values to those we hold important. Part of our ability to make our best contribution to the larger Indo-Pacific community rests on the foundation of our sense of our Australian identity, and to be able to express this with confidence in word and action.

…With the rise of China and the emergence of an Indo-Pacific community, we are seeing the birth of a new strategic order. We are seeing experimentation by China in its regional relationships as it seeks to strengthen its position and perhaps set the terms by which this emerging order functions. The challenge for Australia is to understand how we can participate effectively in this community. We need to be very clear-eyed about who we are and what we stand for. We need to support our interests – and demonstrate that we wish to defend them, particularly through strengthened diplomacy and a robust defence capability.

Good stuff. Time to stop the kowtowing of the business and paid-up Beijing brigade. Why? More from Dr Andrew Foxall is director of the Russia and Eurasia Studies Centre at The Henry Jackson Society in London. Dr John Hemmings is director of the Asia Studies Centre, at Domainfax:

[China] uses a combination of diplomatic and political pressure, manipulation of its diaspora, illicit financing of political parties, and propaganda. According to some, Beijing spends up to US$10 billion ($13 billion) a year on its overseas operations. If this sounds familiar, it is because these are tactics taken straight from the KGB playbook Russia has followed for well over a decade.

Russia’s aim has been to portray itself as a great power on the world stage. Its tactics are often crude and short-term. China’s, by contrast, are slow-burning and systemic. Beijing’s ultimate ambition is to create a Sino-centric regional order, based around tianxia – an imperial concept that puts China at the centre of nations. This strategy is in full force in Australia.Add to shortlist

…China is playing a game of divide-and-rule between Western countries as well as inside Australia. Its aim is to weaken individual countries – and, in doing so, make them vulnerable to Beijing’s influence. But as a member of the Five Eyes intelligence-sharing alliance and a NATO partner, Australia should remember that it has powerful friends.

We need to do much more if we are protect the integrity of our democracy. China is not what we hoped it would become when we took the trade handshake a dozen years ago. It is not liberalising. It is going to other way, into dictatorship. Yet it is still growing in eminence and power projection, so we are forced to construct a new way to deal with it.

China sees its role in the world as manifest destiny with a total claim over the ethnic Chinese imagination without borders. It must therefore be dealt with equally comprehensively. Our response should have three dimensions to it. The astute among you will see that these three steps actually work hand-in-glove with one another.

First, our economy must seek balance. To achieve that we will need a raft of new policies that aim to improve Australian competitiveness and get us out from under the commodity dependence. This is necessary anyway as China slows and changes and wants less dirt. We must reform energy, banking, and real estate to lower the currency, boost productivity and move from urbanisation growth drivers to tradables.

Second, we must engage strategically and diplomatically across our entire region. ASEAN is a natural partner to hedge Chinese influence. The Quadrilateral is also useful in bringing together allies. The US alliance must be constantly tended and revitalised. The Pacific must be treated as the good friend and partner that it is with significant aid and bilateral economic exchange, not the usual afterthought.

Third, Australian politics and society must be prepared and shielded to contain excessive Chinese Communist Party influence. This can easily be achieved via bans on foreign (or all) donations to political parties and the introduction of a federal ICAC. Society, too, is easy enough to protect if we have the will. There is no need, nor desire, for discrimination. We simply cut the permanent migration intake in half. It needs to be done anyway to take pressure off the east coast crush-loading. We should eschew both the cultural chauvinists of the Coalition and the “Asianising” influences within Labor. We are a multicultural democracy with liberal Anglophone roots. Let’s accept and protect it.

Thus, the state of affairs between Australia and China as they are is naturally one of tension. That doesn’t mean we can’t be pragmatic and friendly trading partners. Of course we can. But the period of calm we’ve enjoyed for a decade was a paid-for illusion during which we took the bribe and pretended it wouldn’t come with costs. It does. It jeopardises our democracy. It is finished. Let’s not bring it back.

Instead, let’s deal with things as they are so we don’t wake in fright one day to find the myriad children of the Lucky Country are born into something altogether less young and free.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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