The Broken Ties Between China and Australia Might Get Repaired
It took six years for the Chinese and Australian leaders to meet again. The two leaders shook hands at the G20 summit on November 15, sparking an effort to renew bilateral relations between the two countries. There are several reasons why the relationship between China and Australia took a turn for the worse. It all started in 2017 when Australian MPs – from both the major parties – opposed the Australia-China extradition treaty citing poor human rights conditions in China. And then came the Huawei issue. Like the US, the Australian government too refused to use hardware supplied by Huawei to build and expand the country’s 5G infrastructure.
The Australian government has tightened foreign investment laws as well. Chinese investments now pass through a harsh filter of scrutiny. Back in June, two Chinese investments in the Australian mining sector were blocked by the Foreign Investment Review Board. Australia stepped up its measures to fight Chinese political influence. And lastly, Australia supported the call for an international investigation in China over the origins of the Covid-19 virus.
All these developments negatively impacted the relationship between the two nations. The situation came to the lowest of lows when China imposed a whopping 116% to 218% export duty on various Australian wines leading to a 92% reduction in wine exports from Australia to China. Likewise, Australian barley exports were subjected to an 80% export duty. The country wanted to take a tough stance against Australia to warn the world about the repercussions that any country would face if it tried to follow Australia’s path.
Both the National Coalition before May 2022 and the Labour Party after the federal election in May 2022 refused to surrender to the arm-twisting tactic of China. The country presented 14 grievances that they demanded the Australian government address. However, the Labour Party is in no mood to entertain such demands.
Australia is in a comfortable position because –
- It has found newer markets for Australian exports that can be used to replace the Chinese market.
- Australian exports of coal, Iron and Natural Gas to China remain high because of the simple fact that China can’t easily replace this source with another one.
Why Such a Shift in Tone?
Why does China appear to take a soft stance despite Australia not entertaining its demands? There are three reasons-
First, Xi Jinping has successfully silenced its rivals in domestic politics and has filled the Politburo with his yes-men. Now that he has been ‘re-elected’ with no one to rival his clout, he can experiment with soft diplomacy with other countries without the fear of being termed as a weak leader in his turf.
Secondly, China’s aggressive diplomacy did more harm than good. It united the West against the PRC. The newly formed submarine partnership – AUKUS – between Australia, the United States and the U.K is a testament to this. Interestingly, the nation’s aggression also united the opposing political parties in Australia. This hard stance earned China a bad reputation on the world stage.
Thirdly, there’s this aspect of guilty by association. Russia, one of the strongest allies of China, has been cornered by the world because of its aggression against Ukraine. This close relationship with Russia is harming the internal perception towards China. If it wants to be taken seriously, it needs to present itself as a stable bilateral or multilateral partner. The country has no choice but to tone its aggressive stance down.
After these tumultuous years of relationship, it needs to be seen how much both countries can trust each other.