Australia/China Trade Dispute Turns Into a Diplomatic Brawl

Relations between Australia and its biggest trading partner, China, have rapidly deteriorated as Canberra has recently taken a more muscular approach to Beijing’s increasingly assertive foreign policies.

On Anzac Day, when Australia and New Zealand honor their war dead, Peter Dutton, Australia’s newly appointed defense minister, told the Sydney Morning Herald that Australia was “already under attack” in the cyber domain and warned that Chinese bullying of Taiwan could lead to a regionwide conflict. Home Affairs secretary Michael Pezzullo shockingly added that free nations were hearing the “drums of war” beating again.

Australian Prime Minister Scott Morrison announced a dramatic increase in military spending just before several newspapers published a confidential briefing by a former top general in the Australian Defence Force. He warned that Australia must prepare for the “high likelihood” of actual conflict because China was already engaged in gray zone warfare—aggressive state behavior that is often covert or deniable, and that falls short of acts of war, but includes political interference, cyber intrusions and economic coercion.

Is war conceivable?

The idea of Australia on its own fighting a war against China appears preposterous. Australia is a nation of a mere 25 million people. With no nuclear weapons and a small navy, it would face a nuclear-armed China of 1.4 billion people, with a military budget estimated to be 10 times larger than Australia’s. China has a shipbuilding program that outpaces any other country in history and a navy recently transformed into one of the world’s premier blue-water navies.

Yet Australian attitudes have nonetheless been hardened by Beijing’s heavy-handed approach.

A war of words

As China, now celebrating the 100th anniversary of the Chinese Communist Party, has grown into a powerful and increasingly coercive regional hegemon, diplomatic relations between the two countries have plummeted to an all-time low, and the tone has become more strident.

Conflicts inevitably begin with inflammatory language, and there has been no shortage of incendiary words in the press of both nations. The Chinese Communist Party’s mouthpiece tabloid, the Global Times, has struck a bellicose tone, warning that Australia will face “unbearable consequences” as it becomes the “poor white trash of Asia” and the “gum stuck on the soles of China’s shoes.”

Diplomats or agitators?

While the media can be expected to focus on the sensational, the diplomatic front may be even more challenging. China’s diplomats are openly mocking the racial strife, decaying infrastructure, mass shootings and coronavirus death toll in Western nations, and preaching a message that prosperity lies in China’s future, not with the West.

“China’s ‘diplomacy,’” according to Australian Senator Rex Patrick, “is now little more than abuse” as their diplomats are “not working to build good relations—quite the contrary.”

Australia has been under constant barrage from China’s newly empowered “wolf warrior” diplomats. As one pillar of President Xi Jinping’s goal for a China that stands “tall and firm” in the world, these “wolf warrior” diplomats—a phrase that comes from a Chinese film franchise about a Rambo-like soldier who battles American-led mercenary groups—make diplomacy more difficult with their confrontational rhetoric designed to sow chaos and deflect blame.

One of these wolf warriors, Foreign Ministry spokesperson Zhao Lijian, a known provocateur, says aloud what many Chinese officials say or think in private—that Beijing has too long been subservient to Western countries and too unwilling to hit back at their criticism.

He has joined a chorus of state-run media criticizing Australia’s human rights record on refugees and Indigenous Australians. But when he put out a fabricated Twitter image depicting an Australian soldier with a knife to the throat of a child, angry Australians, including the country’s most-read columnist, Andrew Bolt, declared the doctored picture “another act of war.”

Evolving power and attitudes

Resource-rich Australia has been a vital depot of the commodities that have fueled China’s spectacular growth over the last half century. It is the world’s largest producer of iron ore—the vital component in the production of steel—and 80 percent of it goes to the world’s largest producer and user of steel, China.

Australian attitudes toward Beijing, according to former Australian Prime Minister Tony Abbott, have always distilled down to “fear and greed.” Australia has reaped incredible benefits selling China everything from iron ore and coal to liquefied natural gas and beef.

Until COVID-19 struck, Australia had dazzled the world by surviving the 2008 financial crisis better than virtually any other nation and had a spectacular 29-year run without a single recession as it sent its signature goods to the world’s voracious No. 2 economy.

The relationship turns sour

Recently, Australia has positioned itself at the front of a global effort to stand up to China. In August 2018 Australia infuriated China when it became the first country to effectively ban Chinese tech giant Huawei’s next-generation 5G telecommunications network on national security grounds. Then it persuaded others to follow suit.

Australia publicly detailed the human rights abuses in Hong Kong and provided chilling details of forced labor in Xinjiang, where a million Uighurs have been interned. Canberra was the first to call for an international inquiry into the origins of COVID-19—a turning point for China and one that had to be responded to.

Few countries have prospered from China’s growth as much as Australia, so in the eyes of China’s government, Australia is violating the most basic rule of China’s rise: If you get wealthy with our support, stay silent and grateful.

Diplomacy by other means

Beijing lashed out angrily, wielding its economic power as a political weapon by imposing crippling trade sanctions on Australia.Beijing lashed out angrily, wielding its economic power as a political weapon by imposing crippling trade sanctions on Australia. China struck at Australia’s weak point: its lucrative exports to China.

Beijing either limited imports of or slapped punitive tariffs on critical Australian exports, such as coal, barley, wheat, wine and sheep. The punishment is beginning to bite, as Chinese investment in Australia plummeted 61 percent in 2020, on top of a 47 percent drop in 2019, and there is now concern that Australia’s economy will never return to its pre-COVID path.

An example and a warning

China’s economic offensive against Australia is partly designed to warn other countries against vocally opposing Beijing’s interests. Beijing intends the attacks on Australia to deter others, like Canada, the European Union and Japan, from joining a U.S.-led campaign to counter China’s rise.

“It’s kind of like the canary in the coal mine,” said Heino Klinck, who was the U.S. deputy assistant secretary of defense for East Asia until January. “The Chinese have made it clear that they are going to pull out all of the stops to try and put Australia in a box. It’s not just about Australia. It’s just that the Chinese have decided if they can put the Aussies back into a box, that sends a message to everyone else” (quoted in Foreign Policy, May 4, 2021).

The Australian spine stiffens

Australia has not retreated in the face of Beijing’s ire. If anything, the bullying tactics have strengthened hardened attitudes. According to the last annual poll by the Lowy Institute, trust in China has halved in the past two years, and an overwhelming 94 percent of Australians say the government should find other markets to reduce Australia’s economic dependence on China.

Some Chinese investment projects have been canceled, and more than 1,000 other proposed deals have now been put under government security review. These include Belt and Road agreements with the state of Victoria and a potential deal for the port of Darwin.

Wealth or security?

Australia has been involved in every major American conflict over the past century, but in recent decades Canberra has sought to balance sheltering under an American-led security umbrella and enjoying Chinese-derived wealth. Like Japan, Australia now wants to increase defense spending, but ironically is reliant on a successful economic partnership with China to be able to afford it.

China has long sought to intimidate and pry Australia away from the embrace of the United States, and Australia has been cautious not to provoke its greatest trading partner. According to the Global Times, China sees Australia as “a close collaborator of the U.S. in its anti-China strategy at the expense of China-Australia relations” and a force multiplier for the United States in the western Pacific and South China Sea.

China has amassed a huge arsenal of ballistic missiles and is rapidly building new aircraft carriers. Further, its ambitious Belt and Road Initiative is escalating Beijing’s economic strength—and potential military bases—in the southwest Pacific or Indian Ocean, which could easily threaten Australian shipping routes.

China’s actions prompted Prime Minister Morrison to openly reach out to what he terms “like-minded countries” to form a unified front against what his government considers Chinese aggression. That has meant a newfound focus for the “Five Eyes” intelligence-sharing network that also includes the U.S., U.K., Canada and New Zealand. It is also focusing on the long-moribund “Quad,” or Quadrilateral Security Dialogue—a loose security alliance with the U.S., Japan and India—that is being revived to form what some are calling an “Asian NATO.”

Taiwan in the crosshairs

While the current tit-for-tat clash may settle down, China is determined to displace the U.S. as the dominant power in Asia.While the current tit-for-tat clash may settle down, China is determined to displace the U.S. as the dominant power in Asia. Washington’s alliance partners, like Australia, are inevitably going to take positions that Beijing rejects.

The most dangerous potential flashpoint in the region is the possibility of a Chinese invasion of Taiwan—a conflict that could ultimately involve the entire Asian region and even the U.S.

China considers Taiwan part of its sovereign territory and has vowed to “reunify”—if necessary by force. It is increasing military pressure on Taiwan with regular amphibious assault exercises and menacing military overflights of Taiwan’s airspace.

Beijing lusts after the numerous high-tech companies based in Taiwan. Foremost among them is TSMC (Taiwan Semiconductor Manufacturing Company), arguably the world’s most important company, which designs and builds cutting-edge semiconductor chips generations ahead of American-made chips.

Beijing (and the rest of world) craves these chips that provide the brains to not only computers, but also missiles, artificial intelligence, advanced telecommunications and robotics.

Incredible blessings

Since Australia’s founding in the late 18th century, it has been shaped by unquestioned dependence on an alliance with a distant and dominant power. Britain did that job until 1942, with its mighty fleet possessing the strategically crucial seaports of Singapore and Hong Kong.

The United States has done it since, with its powerful navy guarding the trade-heavy sea lanes of Southeast Asia, including the vital Strait of Malacca, which Australia depends on.

Control of those vital maritime trade routes, or the virtually unlimited mineral wealth that Australia possesses, didn’t happen by chance, however. These blessings were promised to them thousands of years ago—not because of physical greatness, military might or racial superiority, but because of the obedience that one of their nation’s forefathers showed.

History in advance

In the book of Genesis, we learn about two peoples who would become world-leading nations in the decades leading up to Christ’s return. They are the modern-day descendants of Ephraim and Manasseh (Genesis 48:19-22; 49:22-26). Ephraim’s descendants would become a “multitude of nations” (Britain, Canada, South Africa, Australia and New Zealand), and Manasseh’s descendants would become a single “great” nation (the United States).

Scriptures detail that the physical blessings bestowed upon Abraham’s descendants would include bountiful population, abundant natural resources, military power and even control of strategic choke points of commerce (Genesis 12:2-3; 22:17; 49:24-26).

Bible prophecies not only reveal the reason these peoples—including the people of Australia—rose together historically, but also how, at the end of the present age, they will decline and fall together. It will be because they will continue to turn away from the God who blessed them (Ezekiel 5:1-7).

The modern-day nations of Israel will suffer the same punishments and sudden downfall (Deuteronomy 28:20; Isaiah 9:13-14; 30:10-13) as ancient Israel suffered if they do not acknowledge and repent—both individually and nationally—of their sins.

These present-day Israelites have been magnificently blessed because of Abraham’s obedience. Eventually they and the rest of humanity will understand that blessings come from obeying God, and that punishments accrue to those who turn away from Him.

The sure word of prophecy shows that disobedience to God’s law brings its own returns (Ezekiel 6:7-10), so the children of Israel were admonished—as we are today—to “choose life” so that God can continue to share His blessings with us (Deuteronomy 30:19-20).