Blowing in the wind: Australia's China policy is all over the shop

While the drift in most areas of public policy is becoming alarming, perhaps our so-called China policy is among the most concerning.

Our positions on China virtually blow in the wind. It seems we simply hope to muddle through, rather than to develop and respond in terms of a well thought out and defined longer-term strategy on our relations with China.

Blowing in the wind ... our China policy lacks long-term focus. Illustration: Matt DavidsonCredit:

This, in itself, undermines our credibility in Chinese eyes, a nation that thinks, plans and operates in terms of generations. Why should the Chinese take us seriously when we seem to have little concept of our national interest. We are reactive rather than proactive, simply responding, and often inconsistently, as matters arise.

One day we are in the Pacific islands, all bolshie about beating the Chinese in regional infrastructure projects. On others, we are prepared to let some Chinese state-owned enterprises buy one of our ports, or a power distribution network, but not participate in the development of our 5G network. Then there was the embarrassing lack of transparency about the recent visit to Sydney by Chinese naval vessels, followed by our mealy-mouthed position on the protests in Hong Kong against the proposed extradition bill.

While we drift, China creeps. It moves patiently, step by step, towards its end game. We’ve seen it in its territorial gains in the South China Sea. While the world bitched and lamented, control of the islands was seized, then military and rocket-launching capacity was established, even raising doubts about fly-over and navigation rights.

Similarly, while we dawdled, neglecting what successive governments have designated as “our first line of foreign policy responsibility”, the Chinese have poured in cheap loans and peddled influence across the Pacific. I am concerned that our governments, federal and state, have yet to recognise or concede just how far behind we have fallen in this process. As a minor, anecdotal, example, I was recently informed by a friend who maintains a residence in Vanuatu that the Chinese have built over 100 large warehouses there, all still sitting empty. To what purpose?

China was a late entrant to a mature world trade and investment system, and has a vested interest in not being too disruptive, although many question the full impact of its Belt and Road infrastructure initiative. Although the reality is that China will soon be the world’s largest economy, this has been a peaceful rise, certainly not a threat, and a very real opportunity for us.

Of course, many argue we will ultimately be forced to make a necessarily awkward choice between emerging China and our alliance with the US. But surely we don’t need to choose. We can think and act in our national interest, while capitalising on, and enriching, the relationships with both.

We should avoid getting lost in the sense of threats, and think more in terms of opportunities. China is clearly our major economic partner. The US has been assumed to provide a security guarantee. It is  yet to be proven and it has cost us already, dragging us into conflicts such as Vietnam, Iraq and Afghanistan, none obviously in our national interest.

Chinese President Xi Jinping makes his speech at the Belt and Road Forum at the Great Hall of the People in Beijing in April. Credit: AP

My personal experience in China now spans almost 30 years, across politics, in business (ranging from innumerable negotiations and successes to having a world-class plant stolen with zero compensation by a state-owned enterprise), academic relationships, attending many conferences, the Beijing Olympics, and so on.

In my view, China will respect us if we clearly know, define and act in accordance with our national interest. This may involve us clearly defining, and sticking with, certain “no go” areas. For example, we may wish to preserve our sovereignty over key infrastructure, certain nationally significant assets, migration and student numbers, and that we will speak out against, and vigorously oppose, what we consider to be unacceptable domestic, regional and international Chinese practices and initiatives, such as human rights breaches, organ tourism and animal cruelty.

In 1990, having strongly supported Bob Hawke’s decision, post-Tiananmen Square, to offer visas to Chinese students then in Australia, I was concerned about his additional intention to pull back on, even terminate, our diplomatic relations with China. I thought it important to maintain a dialogue, while registering our strongest objections to what had been indefensible breaches of human rights.

I therefore led a delegation of opposition leaders and shadow ministers to Beijing, not as a media event but to clearly make the point that, as China then wished to join the World Trade Organisation  and to build significance influence in global institutions such as the International Monetary Fund, it would be expected to move to adopt Western standards of human rights and governance.

As one of the first Western political leaders to visit Beijing post-Tiananmen, I was afforded meetings with Communist Party chief and soon-to-be president Jiang Zemin, premier Li Peng and other senior ministers. I was even invited to attend as their special guest the first major regional or international sporting event that China had hosted, the Asian Games, but I graciously declined to avoid being the focus of propaganda.

The warmth of the initial introductions faded as the meetings proceeded, to the point where, at the last formal banquet, a 13-course meal was served in about 12 minutes. Clearly, we had made our point, but in a most respectful way.

In a sense, we need to get more definitive, even smarter, in response to China. For example, in response to Chinese "debt-trap diplomacy” – focused on infrastructure projects in our near-Asian and Pacific neighbours – perhaps we should promote some mechanism or institution to help these neighbours with their foreign debt, even by way of limited guarantees. Perhaps we could do this with the support of the likes of the Asian Development Bank and World Bank, on the condition that they don’t borrow more from the Chinese.

This would be a much more effective break on Chinese influence than us attempting to outdo them with such projects, country by country.

We could also make it clear that we see the so-called One China policy as being for its domestic purposes, not something it can use, as it has been doing, to dictate its global behaviour. We will also pursue trading, investment, educational, cultural, and other relationships with Hong Kong and Taiwan. I made this point in 1990 by leading the first Australian trade mission of shadow ministers and business leaders to Taiwan, after that Beijing visit.

While foreign policy hasn't received much attention in our election campaigns, the challenge of a clearly defined China policy should be top of mind to the new Morrison government.

John Hewson is a professor at the Crawford School of Public Policy, ANU, and a former Liberal opposition leader.