Commentary on Political Economy

Monday, 30 November 2020


US has interest in helping Canberra resist Beijing’s extortion

Australia will not be ‘defined by a foreign government’

Illustration: Johannes Leak.
Illustration: Johannes Leak.
  • An hour ago 

Wine has now joined beef, barley, coal and timber among the Australian exports that China’s Communist Party is threatening to quash as part of its intimidation campaign against Canberra.

China announced arbitrary tariffs between 107 per cent and 212 per cent on Australian wines Friday, citing antidumping rules. Perhaps this didn’t elicit the response Beijing had hoped, because on Sunday a Foreign Ministry spokesman sparked another diplomatic row by posting a fake image depicting an Australian soldier slitting the throat of an Afghan child.

The image is apparently a reference to an Australian Defence Force report, released publicly this month, on unlawful killings in the Afghanistan war. Unlike in China, Australia’s government and military are accountable to the public, the press and the courts. Beijing has sought to torment Australia since the country called for an independent inquiry into the origins of the coronavirus pandemic in April.

China now treating Australia as a 'rich political target'

Australia’s relationship with China has hit an all-time low following a Twitter post by China containing a doctored image of an ADF soldier holding a knife to the throat of a child, according to The Australian’s Political Reporter Richard Ferguson.

Yet economic warfare is a greater threat than taunts from China’s “wolf-warrior” diplomats. China has more than 50 times Australia’s population and accounts for nearly 40 per cent of its exports. With tariffs and trade harassment, Beijing wants to signal that it can inflict economic ruin if Australia doesn’t bend the knee on issues like Hong Kong, Xinjiang and Huawei.

Shanghai customs officials recently blocked the import of 20 tons of Australian rock lobster for days. The next target might be Australian iron ore, though so far that has proven too valuable to Chinese industry.

Then US Vice President Joe Biden with Xi Jinping in 2011.
Then US Vice President Joe Biden with Xi Jinping in 2011.
Scott Morrison meets with Xi Jinping during the G20 in Osaka, Japan last year. Picture: Adam Taylor Adam Taylor/PMO.
Scott Morrison meets with Xi Jinping during the G20 in Osaka, Japan last year. Picture: Adam Taylor Adam Taylor/PMO.

As the Asia scholars Charles Edel and John Lee have noted, the U.S. and Australia face different problems from China’s mercantilism. The U.S. has been hit by China’s technology theft, whereas Australia depends more on China’s consumption of raw materials.

Yet the US shares an interest in helping Canberra resist Beijing’s extortion. China is trying to rewrite the rules of economic development in the Pacific. It wants to condition access to its economy on submission to China’s increasingly authoritarian political system, including limits on criticism from abroad.

If Australia can demand trade and diplomatic relationships based on equality, then so can nations like the Philippines and Indonesia. If it can’t, then China will draw more nations closer to its orbit, and the Pacific balance of power will drift away from the U.S.

Joe Biden and his team have emphasised the importance of alliances to US interests. One major question is if by this they mostly mean reverting to Obama-era relationships with Germany and the European Union, or if they also will do what is needed to balance China in its neighbourhood. Australia is a key partner in the region, though Biden envoy John Kerry may see it as a climate delinquent.

In Australia, moderate views on China have diminished quickly, even among business interests, as Beijing’s bullying grows more brazen. The same is happening in the US, and the trend will continue if China doesn’t change course.

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