22 May 2019
Morrison’s great China uncertainty
One of the curiosities of the Australian election was that foreign affairs received so little attention, despite it playing a vital part in Scott Morrison’s victory. Throughout the campaign, Morrison took every opportunity to highlight the rising tensions and escalating trade war between the United States and China. But he didn’t raise this to propose solutions or suggest an approach that might help Australia navigate it. Instead, he used it as background noise against which to present his core election message – that Bill Shorten posed a “big risk at a time of great uncertainty”. Well, Morrison won, and this great uncertainty is no longer a campaign tool.
China–US relations is one of Australia’s biggest challenges, threatening security and prosperity. It will also determine whether the returned prime minister can fulfil his two main promises: $158 billion worth of tax cuts and a budget surplus in 2020. Neither will be achieved if the trade war ends badly, or if China’s economy slows, or if Morrison mishandles relations with Beijing.
Morrison doesn’t have strong foreign policy credentials – but nor did most recent Australian prime ministers before they took office. So far, he has made two significant forays into international affairs. The first was his ill-fated plan to relocate the Australian embassy in Israel to Jerusalem – part of a bid to win a by-election in Wentworth, proposed without consultation, and eventually wound back when Indonesia and others protested. The second was his Pacific step up – an effort to bolster ties with Australia’s Pacific neighbours to counter fears of China’s growing influence. This has been well received in the Pacific, though stronger regional relations have been impeded by the Coalition’s lack of an effective climate change policy.
The prime minister doesn’t seem to have seriously grappled with the challenges posed by China, nor the difficulty of preserving Australia’s most important trade relationship with a country that is in fierce and intensifying competition with Australia’s closest ally. At times, he appears to think he can replicate the approach of his mentor, John Howard, who insisted Australia didn’t have to choose between these two great powers and that a commitment to the US alliance wouldn’t affect trade with China. But this strategy, forged a generation ago, is no longer feasible – not in this era of Huawei, the Belt and Road Initiative and the South China Sea patrols; a time when Canberra must explicitly back either Washington’s security demands or Beijing’s increasingly ambitious global ventures.
Morrison has also indicated that he may follow the approach of Tony Abbott by pursuing closer ties with Tokyo, to encourage a greater regional role for Japan that will potentially offset China’s clout. Japan and Australia have much to gain from championing free trade in the region and together led the push to keep the Trans-Pacific Partnership alive after Donald Trump withdrew America from it. But Japan has a fraught relationship with China, so Morrison should tread warily. Promoting Japan may be perceived by China as a slight, or as an attempt to contain it. Australia shouldn’t compromise its values or foreign partnerships to kowtow to China, but it should also aim to calm tensions in Asia rather than stoke them.
Earlier this week Xi Jinping, accompanied by his top trade negotiator Vice Premier Liu He, visited a monument that commemorates the Communist Party’s Long March eighty-five years ago, its wartime trek of around 10,000 kilometres to avoid attack. Xi’s visit signalled that he is settling in for a lengthy trade battle with the United States. Trump has indicated that he, too, is patient; he may even consider a prolonged stand-off with China as politically beneficial ahead of the 2020 presidential election. The fallout for Australia, and others, could be devastating. Morrison needs to prepare for the consequences – and to view these great uncertainties as a national priority, rather than a political weapon.