New world order needed for China, Morrison warns

Scott Morrison has said world trade rules are ‘no longer fit for purpose’ because of the rise of China and new technologies.

Scott Morrison with Donald Trump at the Pratt Industries plant in Wapakoneta, Ohio on Monday. Picture: AFP

Scott Morrison has said world trade rules are “no longer fit for purpose” because of the rise of China and new technologies, arguing they must be adapted to a new global economic order.

On Monday, the Prime Minister endorsed US President Donald Trump’s view that world trade laws must change, but also welcomed Chinese economic growth and urged Beijing to accept the responsibilities and obligations of a “newly developed nation”.

Speaking in Chicago after visiting Mr Trump for three days in Washington and Ohio, Mr Morrison said there was a “strenuous endeavour” to maintain the “great alliance” with the US.

In his major foreign policy speech of the 10-day US tour to the Chicago Institute for Global Affairs, Mr Morrison said that Australia, the US and the Indo-Pacific region had to find ways to reduce trade tensions.

However, while calling on China to adopt attitudes to trade, the environment, smaller nations and economic transparency in keeping with its “newly developed” status, Mr Morrison did not use any of the harsh rhetoric Mr Trump has in recent days. “China’s economic growth is welcomed by Australia and we recognise the economic maturity that it has now realised as a newly developed economy,’’ the Prime Minister said. “This was the point of the world’s economic ­engagement with China.

“Having achieved this status, it is important that China’s trade ­arrangements, participation in addressin­g important global envir­onmental challenges, with transparency in their partnerships and support for developing ­nations­­, reflect this new status and the responsibilities that go with it as a world power.”

Mr Morrison said the role for Australia in helping ease trade and security tensions was to help the US bear the unfair burden it has had while welcoming and helping China’s economic prosperity and growth.

“The world’s global institutions must adjust their settings for China, in recognition of this new status. That means more will be expected, as has always been the case for nations like the United States,” Mr Morrison said.

Mr Trump insists any settle­ment of the trade war will requir­e changes to China’s ­approach to intelle­ctual property and forced technology transfer, which will help the US and Australia.

China has used its status as a “developing nation” to limit international environmental demands, has been found in breach of WTO rules and to have acted illegally with territorial claims in the South China Sea which deny freedom of navigation.

Mr Morrison repeated what he has said earlier on the US visit — that China’s economic growth was assisted by security in the region, which was assured by the US, along with its entry into the World Trade Organisation.

“It is also true … China’s econo­mic expansion was made possible by the stability underwritten by US strategic engagement and the international community who built the global trading system and welcomed China’s accession to the WTO,” he said.

Mr Morrison said Australia would not take advantage of the long, strong US alliance and would contribute to lifting the unfair burden­ America bears and was expandi­ng Australia’s role in the “southwest Pacific”.

“We are committed to working with the US internationally because­ we agree it has borne too many burdens on its own. Australia will continue to pull its weight. We do not shrink from strife.

“Our alliance has never been stronger. It’s also how we approach our alliance relationships, how we build a strong economy and secure nation, how we provide for our families and enable them to contribute to their communities.”

The region, Australia and the US were facing “a changing econo­mic order and transformative technological change”, which needed to be faced with “confid­ence, resolve and clearly articulated principles”.

“That is the central focus of my government in the Indo-Pacific. It is the region where we live. It’s the region that will continue to shape our prosperity, security and destiny­ and, increasingly, the globa­l balance of power,” he said.

Mr Morrison said he agreed with the US President’s assessment that the global economic system served the world’s interests but was in need of reform.

The day before, Mr Trump — opening the Australian-owned, $US500m ($738.6m) Pratt Industries paper plant in Ohio — praised Mr Morrison for understanding that “fair and reciprocal trade” was necessary for inter­national prosperity.

In Chicago, Mr Morrison said the engagement with the Indo-­Pacific would be based on the principles of commitment to open markets and the free flow of trade based on rules, not coercion, respect­ for sovereignty of nations and international law, and the peaceful resolution of disputes.