Ukraine resistance may spark China rethink on trade: Robert Gottliebsen

Russian President Vladimir Putin and Chinese President Xi Jinping pose for a photograph during their meeting in Beijing in February. Picture: Alexei Druzhinin / Sputnik / AFP

Russian President Vladimir Putin is cornered in Ukraine. Cornered dictators are always dangerous.

Almost certainly the Ukraine mess will trigger serious debate in China between those who want to pursue the exciting possibilities of a rail line linking the Pacific with the Atlantic and those who want to follow the current tough line eventually leading to an invasion of Taiwan.

Just as Russia has discovered that invading a well-armed hostile small country like Ukraine is extremely hazardous for a major power, so China has discovered that its policy of bashing small countries with trade bans can also backfire.

As China prepares for the 20th National Congress of the Communist Party later this year, there is a real chance that after the Australian federal election the Chinese will look closely at watering down some of the trade bans they placed on Australia.

China has discovered that when a major country launches a trade attack on a small country, it can backfire dramatically. Last February when the small Baltic country, Lithuania, accorded a qualified recognition of Taiwan, the Lithuanians suddenly found their country was no longer listed by China Customs. This meant they could not clear cargoes destined for China. China had earlier implemented a similar practice on Australia. Europe’s reaction was savage and China could see its hopes for a rail line from the Atlantic to the Pacific being destroyed. So it retreated.

In Australia’s case, the adverse repercussions took longer to eventuate. Understandably China had no respect for our country because they watched a series of inexperienced and second grade defence ministers combined with public servants of poor calibre invest billions in useless defence expenditure. There was a commitment to pour more money down the drain. China saw Australia as a regional joke in defence equipment with no mandate to lecture them on colonial style.

But the trade bans on Australia might never have backfired but for an event no one could have predicted – the revelation by Brittany Higgins of alleged sexual assault landed on the defence minister’s desk.

That led Prime Minister Scott Morrison to appoint one of his best ministers, Peter Dutton, into the defence portfolio. Dutton brought a new approach to Australia’s defence and mobilised Foreign Affairs Minister Marise Payne (who was defence Minister in 2016 when the French conned Australia into the submarine contract) plus, of course, the Prime Minister. They formed one of the most effective small country diplomatic forces in the world. We not only put together the Quad arrangement but cancelled the disastrous French submarine contract and replaced it with a nuclear submarine alliance with the UK and the US. China was furious with the strategies but there was now respect.

We are now going to see an election campaign where the parties will outdo each other in being tough on China. That’s not a terribly good idea, but China has only itself to blame.

And of course ironically the trade bans did not greatly impact Australia because for the most part, other countries filled the China supply gap and we exported to their previous markets. Only wine has been hard hit.

Meanwhile China itself suffered blackouts and freezing temperatures while Australian coal was marooned off the coast of China.

China’s new ambassador to Australia, Xiao Qian has offered an olive branch saying the two countries should “meet each other halfway” and “look into the future”.

He said China attached “great importance” to the relationship and was willing to “actively develop friendship and co-operation with Australia”.

For China, it will be a lot easier to settle the matter if the ALP wins the election because the previous government can be blamed. But even if Morrison wins, many of the issues that were the subject of Australian “lectures” to China have moved on. Hong Kong is now part of China. The Muslims in western China will be an issue that China will need to settle with Europe (which has a strong Muslim population) as part of the Pacific to Atlantic rail line which passes through the Muslim areas of China.

Depending on the Chinese strategic conferences in advance of the Twentieth Congress, Taiwan is now less likely to be invaded by China given the Russia experience in Ukraine. That leaves the straits of China as the major dividing issue, but again it is a regional issue not just an Australian matter.

Clearly it is possible that China will become even more aggressive in the light of events in Ukraine but there is clearly a chance of a break-though given the intense desire of President Xi Jinping to make the link between the Pacific and the Atlantic oceans via a fast train line part of his legacy.

Meanwhile in Ukraine, the world is facing a very dangerous situation with a cornered dictator that has nuclear weapons.

But if the invasion ends up with a puppet Ukraine ruler, plus constant guerrilla warfare, then the rail project will be dead. President Xi will need to confess that to the 20th National Congress of China. For world stability and stock markets, we have to hope that the Chinese forces favouring trade over military pressure win the debate. There are no certainties.