Research & Analysis

Australia-China feud and its implications

Introduction

Australia-China ties have steadily deteriorated during the midst of the coronavirus pandemic. The main cause for increased tensions between both countries is Australia’s demand for an inquiry into the origins of the coronavirus pandemic (even before the outbreak of the pandemic, significant cracks had begun to emerge in the bilateral relationship, as a result of divergences on strategic issues).

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A number of countries have echoed Australia’s views without being as vocal. The World Health Organisation accepted a resolution, at the recent World Health Assembly held virtually, which sought an impartial probe into the global handling of the pandemic. Both China and the US accepted this resolution, sponsored by the European Union (EU) on behalf of more than 100 members of the WHO. Beijing has repeatedly accused Australia of acting as an appendage of the US in recent weeks. The Global Times used especially harsh language for Australia in an opinion piece, published on May 19, 2020 dubbing Australia as ‘… giant kangaroo that serves as a dog of the US’

It would be pertinent to point out, that  Chinese officials as well as the country’s media have stated that the thrust of the resolution accepted by the WHO is totally different, from the inquiry which Australia has sought. This was in response to Australia claiming that WHO’s acceptance of the EU sponsored resolution was a vindication of Australia’s demand.

Victoria’s economic links with China

As Beijing and Canberra ties deteriorate, one issue which has been in the news is the province of Victoria’s dealings with China, especially with regard to the Australian province being part of the Belt and Road Initiative (in 2018, Victoria had signed an MOU for  being part of BRI during the visit of the Australian Premier Daniel Andrews, and in October 2019 a ‘framework’ agreement was signed to deepen involvement). Victoria’s decision to be part of BRI has drawn flak both domestically and from the US. Before discussing this, it would be important to examine some of the other reasons why this is significant.

First, US states, Australian provinces, Canadian Provinces, and in recent years even Indian states have been playing an important role, in fostering economic ties with China. In recent years, Beijing has been using its provinces to push forward the project in BRI in Africa, South Asia and South East Asia.

Second, federal governments and sub-national governments are not always on the same page on foreign policy issues. It would be pertinent to point out, that in February 2020, US Secretary of State, Mike Pompeo, while addressing governors of US, made the point, that Beijing was keen to explore frictions between Washington DC and US states, and the latter should be careful vis-à-vis economic exchanges. Said Pompeo during his speech:

“What China does in Topeka and Sacramento reverberates in Washington and Beijing and far beyond.”

It would be useful to point out, that even during the midst of the China-US Trade wars, a number of US states have been seeking to strengthen economic ties with Chinese Provinces in the past two years, both officially and through Chambers of Commerce, and have also been scathing in their criticism of President Donald Trump’s decision, to impose tariffs arguing that US interests are being hit. US Chambers of Commerce have also been highlighting the damage Trump’s imposition of tariffs has caused to the economies of US states, and impacted certain lobbies.

While US-China ties hit rock bottom in the midst of the coronavirus pandemic, China provided medical relief materials and this gesture was hailed by the New York Governor Andrew Cuomo

“This is a big deal, and it’s going to make a significant difference for us”

Australia-China bilateral ties

China-Australia tensions in recent weeks have worsened in recent weeks as has been discussed earlier.  Australia’s repeated calls for a probe into the origins of the coronavirus have resulted in Beijing taking some harsh economic steps. China was quick to impose a ban on imports of beef from Australia’s four largest abattoirs, while also imposing tariffs, of over 80%, on Barley Imports from Australia. China happens to be Australia’s largest trading partner (Australia had a surplus of over 58.45 Billion USD in 2019) and there have been calls for a nuanced approach vis-à-vis China by retired policy makers, sections of the business community as well as the media.

Chinese Ambassador to Australia, Cheng Jingye in a media interview last month had also warned Australia, that if it continued to take an aggressive stand vis-à-vis China, the latter would be compelled to explore harsh measures such as boycott of Australian goods, as well as on education and tourism (Australia is a preferred destination for higher education for many Chinese students).

US criticism of Victoria’s agreements with China

What is interesting is US Secretary of State Mike Pompeo’s statement, that the US could simply ‘disconnect’ from Australia, if Victoria went ahead with the BRI. The US Ambassador to Australia downplayed Pompeo’s remarks, saying that Australia was a trusted ally and that the US trusted Canberra’s judgment on matters pertaining to security. It would be important to point out, that the Australian federal government has been critical of Victoria’s decision arguing, that Victoria did not consult the country’s Department of Foreign Affairs and Trade while signing the agreement in 2019. Victoria has been arguing that this deal is in its economic interests, while a number of strategic analysts as well as Australian politicians have stated that Victoria needs to carefully examine the security implications of closer engagement with China, especially in the context of BRI.

Conclusion

In conclusion, ties with China are likely to face numerous changes, but it remains to be seen how business lobbies and sub-national lobbies in countries that have close economic ties with China will adapt to such a situation. The relationship between federal and provincial governments which has been debated in the midst of the coronavirus pandemic, is also likely to be important in a post corona world in countries like US, Australia, Canada and India, in the context of crucial foreign policy issues, such as economic linkages with China.

 

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Consulting Editor, Geopolitics with The DispatchTridivesh Singh Maini is a New Delhi-based Policy Analyst. He is associated with The Jindal School of International Affairs, OP Jindal Global University, Sonepat, Haryana. He is a former SAV Visiting Fellow (Winter 2016) with the Stimson Centre, Washington DC. Mr Maini was also an Asia Society India-Pakistan Regional Young Leaders Initiative (IPRYLI) Fellow (2013-14), and a Public Policy Scholar with The Hindu Centre for Politics and Public Policy, Chennai (November 2013-March 2014). His research interests include; the role of Punjab in India-Pakistan ties, the Belt and Road Initiative (BRI) and the changing nature of Indian federalism. He is a contributor for a number of publications including; The Hindu, The Diplomat, Modern Diplomacy and The Geopolitics.

 

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About the author

Tridivesh Singh Maini

Consulting Editor, Geopolitics with The Dispatch, Tridivesh Singh Maini is a New Delhi-based Policy Analyst. He is associated with The Jindal School of International Affairs, OP Jindal Global University, Sonepat, Haryana. He is a former SAV Visiting Fellow (Winter 2016) with the Stimson Centre, Washington DC. Mr Maini was also an Asia Society India-Pakistan Regional Young Leaders Initiative (IPRYLI) Fellow (2013-14), and a Public Policy Scholar with The Hindu Centre for Politics and Public Policy, Chennai (November 2013-March 2014). His research interests include; the role of Punjab in India-Pakistan ties, the Belt and Road Initiative (BRI) and the changing nature of Indian federalism. He is a contributor for a number of publications including; The Hindu, The Diplomat, Modern Diplomacy and The Geopolitics.