Tensions over China need global solution: Morrison

Scott Morrison says the world is grappling with the rise of China and needs a new global architecture.

Prime Minister Scott Morrison shares a lighter moment with world leaders at the G7 in Biarritz, France on Monday. Picture: Adam Taylor

Scott Morrison says the world is grappling to deal with the rise of China and will need a new global architecture to avoid repeating the great conflicts of the past.

The Prime Minister has also backed US President Donald Trump’s pursuit of a “new deal”, claiming the current economic and strategic tensions between the two superpowers were an ­inevitable consequence of China’s success.

Speaking to The Australian following the close of the G7 summit in France, which was overshadowed by US-China trade tensions, Mr Morrison said the world was confronted with a “what next” ­moment in history.

“China needs to become part of the new global architecture and that’s what we are wrestling with,” Mr Morrison said. “Name a time in history where economic developments haven’t led to strategic tensions. That’s always why strategic tensions have emerged.”

However, Mr Morrison said those tensions did not need to end in conflict.

“That’s what has happened in the past. But I think this time around we are in a much better position to get a different outcome. We are at a point of gear change and at a pretty significant level. But if people are looking for some sort of malevolent intent in all of this then I think that can be a self-fulfilling (prophecy).

“So I’m not fatalist or pessimistic about it … The world has ­always been quite complex and has always had downside risk if you don’t resolve these issues.”

Describing the rise of China as the defining event of the modern age, Mr Morrison said Australia had been an instrumental part of the US post-war plan to deliver China out of poverty.

“That was what the plan was intended to deliver … the post-war reconstruction, peace and prosperity (and) a multilateral system designed to enable countries to rebuild after the Second World War.

“From when Nixon first went (to China) … the point was China would not remain poor; that it would become a success … And it has. And we should be pleased about it.

“But the ‘what next’ when they become a success is what we are now confronted with.”

Mr Morrison is a strong critic of China’s claim to developing nation status and that it allowed China to play by different rules, giving it an advantage in the expansion of global trade.

“My genuine view is that the President (Mr Trump) just wants to get a new deal … He doesn’t like the current one,” Mr Morrison said. “The President makes a fair ­observation as to how that’s all played out. And going forward he’d like it to look a bit different and I don’t think that’s unreasonable.

“(The tensions between the US and China are) a natural consequence of events … And then you have to overlay that with the digital technology revolution which has hyper-charged this. It manifests itself most significantly in the trade relationship with US and China.

“It means now we have to look at the challenges, not as a failure of the system or some sort of malevolent undercurrent … We now need a gear change to modify the system.”

Mr Trump and China’s President Xi Jinping yesterday agreed to resume talks on easing the trade war following an escalation last week that resulted in retaliatory tariff hikes. Mr Morrison was reserving judgment yesterday, claiming the two leaders had reached rapprochement before.

“It’s in everyone’s interest to work this out,” Mr Morrison said. “What did they think was going to happen? We need to restore some stability … It’s about establishing a new balance, a new equilibrium and that’s what we are seeing playing out.”

Mr Morrison said Australia’s place in the world was well established. “And I’m vigorously pursuing Australia’s interests, making sure we don’t get overwhelmed by these events,” he said.