China weighs into election with deeper coal ban

Via The Australian:

Chinese state-owned power stations are specifically requesting coal from Indonesia, rather than Australia, as they put out tenders for new coal supplies, according to S&P Global Platts’ Asian thermal coal expert, Michael Cooper.

“The state-owned power stations are not buying Australian thermal coal and the traders say there is a political dimension to it,” Mr Cooper said in an interview with The Australian over the weekend.

“They are saying ‘this is a political thing and the state-owned enterprises (SOEs) are following a government direction’.

Let’s call it what it is: electoral pressure. China is opening the opportunity for either side of politics to break ranks and do a deal. The election may or may not be specifically part of the strategy but it’s obvious nonetheless.

Via the AFR on the weekend:

Fast-forward two years to the first official day of the current election campaign and the lack of consensus about China that exists behind the official bipartisan veil was obvious on Thursday night. The occasion was a debate on Australia and China at the Centre for Independent Studies (CIS), a conservative Sydney-based think tank. John Lee, a onetime adviser to former Coalition government foreign minister Julie Bishop, and now a non-residential Senior Fellow at the Hudson Institute in Washington, told an attentive audience that after the election, China “will offer a reset” in relations with Australia, irrespective of which party forms a government.

However, this “reset” will be restricted to the policies the Chinese “don’t like,” Lee said. Examples of these post-election “reset” targets could include the Turnbull government’s tough foreign interference laws, which were introduced into Parliament at the end of 2017, and the banning of the Chinese company Huawei from bidding for work in the proposed Australian 5G network.

…On the other hand, Professor James Laurenceson, deputy head of the UTS-linked Australia-China Relations Institute (ACRI), took a more benign view. He told the CIS audience “the rhetoric got way out of kilter” in Australia’s relations with China. While “ideas” about government and the control of a society would continue to differ between democratic Australia and China’s one-party state, the common interests between the two countries “will coincide more”.

Laurenceson’s ACRI counterpoint only exists in this debate owing to the donation of exiled and alleged Chinese agent of influence Huang Xiangmo. In other words, we’re being set up.

Australia should do no such deal. Neither side of politics needs any kind of “reset” for coal or anything else that sells out our sovereignty or ANZUS. So far, so good, via Domain:

The Australian government says it will be standing by its ban on Huawei’s participation in the rollout of ultra-fast 5G technology, rebuffing a Chinese complaint to the World Trade Organisation.

The complaint, made at a WTO meeting in Geneva on Friday, does not mention the telecommunications company by name but refers to Australia’s “discriminatory market access prohibition on 5G equipment”, according to the meeting’s agenda seen by The Sydney Morning Herald and The Age.

…Trade Minister Simon Birmingham said in a statement on Sunday that the government “stands by its decision in relation to 5G, which was not targeted at any one country or telecommunications company”.

What we need to be doing is preparing ourselves for more of this nationalist trade war by diversifying the economy urgently:

  • halving immigration;
  • forcing universities to heal on Chinese influence;
  • enforcing bans on Chinese foreign investment, including in housing;
  • increasing competitiveness via tax reforms like the removal of negative gearing and many other productivity lifters.

This is only the tip of the spear both in terms of China’s future economic pressure and our national defense. We need to get ahead of it or the spear will sink deeper and the key decisions made about the next century of Australian democracy will be made before we know why.

David Llewellyn-Smith

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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      • DingwallMEMBER

        Keep an eye on them rolling out Huawei 5G networks and this cool new social credit score system………………

      • the only thing that stands in the way is South China Sea dispute. If they agree on that China will probably take Indonesian gas and coal at our expense. I see this as risk for Australia. Time will tell.

    • DingwallMEMBER

      Or suggest to China they can buy our iron ore on the proviso they take a tonne of coal for each tonne of iron ore. See them start back tracking once their iron ore blood supply is constricted……

  1. Meanwhile … the Courier Mail (plumbing new journalistic depths) today says that “millions” of Indian Australians are pleading with anti-Adani activists to allow children in India access to electricity via coal mined from the controversial project.

    Do it for the chilluns! (sniff, sniff)