China and the West: signs of a relationship in decline
https://dailyfriend.co.za/2020/12/19/china-and-the-west-signs-of-a-relationship-in-decline/
Australia may be the bellwether of China’s foreign relations with Western nations – and their relationship is on the decline.
As reported by the Daily Friend, a senior spokesman in China’s Ministry of foreign affairs, Zhao Lijian, tweeted a doctored picture of an Australian soldier holding a knife to the neck of an Afghan boy. The picture outraged the Australian government, with Prime Minister Scott Morrison criticising it harshly and calling on China to apologise. This is nothing new in the deterioration of relations between the two countries, but Australia’s more hawkish stance on China says a lot about how democratic nations might deal with China in the future.
Australia – a wealthy, developed economy – has seen remarkable economic growth. Despite being a developed country with high GDP per capita, Australia has not had a recession since 1991. While the rest of the world struggled through the 1997 Asian financial crisis, the Dot-com bubble and the Great Recession of 2009, Australia’s economy has powered on without ever experiencing more than two consecutive quarters of GDP decline. It took government-mandated lockdowns and a global pandemic to finally knock the Aussie economy into recession (along with the rest of the world).
Australia is the 8th largest country in world, but is home to just 25.7 million people. The vast Australian Outback is sparsely inhabited, but highly rich in natural resources such as oil and industrial metals. Australia is the world’s top producer of iron ore and bauxite, the second largest producer of gold and the third largest producer of uranium and cobalt.
Such vast reserves of natural resources, coupled with its location in the region, mean Australia is in a prime position to sell to rapidly emerging markets in East Asia. Of these, none has been so voracious a consumer as China.
It is perhaps no surprise, then, that the 28 years in which Australia steamed ahead without a recession coincided with China’s most rapid economic growth rates of the 1990s and 2000s. China is by far Australia’s largest trading partner. In fact, China trades more with Australia that Australia trades with its next eight largest trading partners combined. Indeed, the extent to which the Australian economy is invested in China is quite staggering. In 2019, China purchased 32.7% of the value of all Australian exports.
With statistics like these, it’s easy to see how any economic decoupling or trade war between the two would bring great harm to Australia’s economy – which is why the recent decline in diplomatic relations between Canberra and Beijing is notable.
Trump’s rhetoric and actions
It’s hard to say where it all began with Australia, but no doubt Donald Trump’s rhetoric and actions on China have had a large influence. In late 2018, Huawei was banned from Australia’s 5G network. In 2019, the Hong Kong protests erupted, galvanising a great deal of anti-CCP rhetoric from governments around the world, with American lawmakers arguably taking the lead in passing the Hong Kong Human Rights and Democracy Act. In November 2020, Australia signed the Reciprocal Access Agreement (RAA) with Japan which would allow shared military training and operations between the two nations’ armies. Again, this angered China.
Australia, however, does not seem to be backing down. In a move that perhaps angered China the most, Australia led a coalition of 62 countries in calling for an independent enquiry into the outbreak of the Covid-19 pandemic. Though the statement did not mention China by name, it was received particularly badly in China, where state-run media lashed out at the Morrison government for the move.
A mini-trade war might even seem to be on the horizon following China’s imposing heavy tariffs on Australian agricultural products. Tariffs have since been levied on barley, beef, and, just recently, Australian wine, in this case a massive tariff of up to 212%. Though agricultural products do not account for the bulk of Australia’s exports to China, the tariffs hit home for Morrison, as a lot of his voter base is in rural Australia.
This recent tweet from Zhao Lijian elicited an angry response from the Australian government, with Morrison labelling the image ‘repugnant’ and calling for an apology. Criticism was levelled across the board by the Australian government.
China is not a democracy. It is a run by a one-party authoritarian government, it has a poor record on human rights and its citizens’ civil liberties are curtailed – especially with regard to criticism of the government. This has often earned criticism from liberal democratic governments around the world, but particularly in the West. As China’s economy grows, however, so does its power and influence on the world. Should any country criticise China on political grounds, economic retaliation such as tariffs or other trade restrictions could have a devastating effect on it. One might say that the economic cost of having a bad diplomatic relationship with China increases as China’s economy grows.
Louder political message
Australia is hugely economically invested in China and thus its willingness to risk economic hardship through diplomatic incidents projects a much louder political message.
Though Australia is a Western-style liberal democracy, it has for a long time pursued a more amicable relationship with China. That began to change in the 2010s, but the relationship has taken a massive dive since 2018. Given the great economic costs to Australia if a trade war were to ensue, what should this teach political analysts? The willingness of the Morrison government to contemplate such a risk shows how priorities have shifted of late.
If anything, it shows the extent to which political issues involving China are now becoming so dire as to be worth the risk of economic decoupling. Though the United States, Canada and the EU all trade a great deal with China, none compares to Australia.
An Australian decoupling from China would be momentous – it would signal the point at which political priorities outstrip economic benefit. With diplomatic tensions mounting, Australia has an enormous amount to lose – economically that is. Politically, more conflict with China will simply add Australia to the list of democratic nations already unafraid to criticise China and bear the economic consequences. One should therefore take note of the recent spat between the governments of the two countries, as it shows a significant change in their relationship.
A recent article in China’s state-run newspaper Global Times had the following to say about the relationship’s deterioration:
‘Canberra is treading a hazardous path that has no prospects for a U-turn during the Covid-19 pandemic, and likely for a long time afterward.’
Canberra is in all likelihood fully aware of this. The fact it is pressing on is not a sign that the China-Australia relationship is insignificant, but that the political costs of staying silent on China are becoming too much to bear. If even Australia can no longer keep its mouth shut, what can be expected from other democratic nations?
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