Business wants negotiation with China, not war: Innes Willox

The nation is facing a long-feared ‘day of reckoning’ between its security and economic relationships, Australian Industry Group chief executive Innes Willox says.

Innes Willox says “you will hear no talk of ‘drums of war’ from Australian business”. Picture: AAP

The nation’s peak industry association has urged the federal government to calm tensions with China through “negotiation, common sense and diplomacy”, but not at the expense of Australia’s national interests.

In a speech to Department of Foreign Affairs and Trade officials, Australian Industry Group chief executive Innes Willox warned the nation was facing a long-feared “day of reckoning” between its security and economic relationships.

He said tensions could escalate, and called for an end to inflammatory language, such as that used by Home Affairs Secretary Michael Pezzullo, who warned “the drums of war” were beating.

“On the security front, of course, the reality is things could also get worse, far worse, before they get better, but that would only happen after negotiation, common sense and diplomacy fundamentally fail,” he said last Thursday. “Let us all work and use our links to ensure it does not come to that. You will hear no talk of ‘drums of war’ from Australian business.”

Mr Willox’s comments were backed by other prominent corporate figures, including Warwick Smith, the former Liberal MP who now runs the Business Council’s international engagement efforts.

Warwick Smith. Picture: Aaron Francis

“Some actions of our government might have been dealt with more nuance. Some of the commentators have really accelerated the issues,” Mr Smith said.

“The cumulative impact for an oversensitive China has not played well for Australia.

“The government has a tough job and we understand that and we are trying to understand it far more deeply. But we want them to understand us,” he said.

“There’s a mutuality between business and government on how we deal with this. I’ve been in and out of China for many, many years and it shouldn’t be as bad as it is.”

Elizabeth Gaines, the chief executive of Fortescue Metals, told The Australian in a statement that the company supported Scott Morrison’s “call for a reset in the relationship” with China.

Mr Willox, a former diplomat, told DFAT officials that the nation’s security challenges were a key issue for business.

He said it appeared China was seeking to drive a wedge between Australia and New Zealand, with state-run media reporting New Zealand imports could replace Australian dairy, beef and wine.

Chinese Foreign Ministry spokeswoman Hua Chunying. Picture: AP

“Business would obviously prefer the differences be patched up but not at the cost of Australia giving up or forgoing our national interests. We have been advising our members that this dispute has some way to run and will for a long time yet impact our interests in China, its territories, its spheres of influence, its markets,” he said.

His comments came as China questioned the United States’ preparedness to stand up for Australia ahead of its own interests, after Secretary of State Antony Blinken declared the Biden administration would “not leave Australia alone” to face Chinese coercion.

“That’s what allies do,” Mr Blinken said at a joint press conference in Washington with Foreign Minister Marise Payne.

“We have each other’s backs, so we can face threats and challenges from a position of collective strength,” he said.

But Chinese Foreign Ministry spokeswoman Hua Chunying suggested Americans wanted their government to look after their own interest, not those of other countries.

“Does (Secretary Blinken) believe Australia’s interests are more important and come before US interests?” Ms Hu said.

“If that’s the case, I wonder since when has the US policy shifted from ‘America First’ to ‘Australia First’?”

Foreign Minister Marise Payne with US Secretary Antony Blinken in Washington over the weekend. Picture: AFP