What price has Australia paid to get Mr Albanese’s meeting with Xi Jinping?
Albanese visits Xi

Mr Albanese's Beijing visit is another waypoint in facing the China challenge - and that's about more than the bilateral relationship and Australian concessions.

Written by

Michael Shoebridge

The meeting between Anthony Albanese and Xi Jinping in Beijing this week is the culmination of the Albanese government’s efforts to show it has stabilised the bilateral relationship between Australia and China.

The stated goal expressed by Foreign Minister Penny Wong is ‘a stable, constructive relationship’, ‘based on mutual respect, equality, mutual benefit and navigating differences, in keeping with our Comprehensive Strategic Partnership.’

No doubt we will hear these words echoed on Mr Albanese’s visit.

But what has Australia had to give up to get this meeting and handshake?  Quite a lot, it turns out.

Since coming to power in May last year, the Albanese government has made 3 large concessions to Chinese interests at the expense of our own, and also changed its position substantially on a fourth.  Each of these compromises has wider effects than just on the Australia-China bilateral relationship and each shifts the balance of influence and power in the region in Beijing’s favour, against the interests of Australia, our partners and allies.

The first big concession was on the barley trade.  In April this year, Australia suspended and later ended our WTO case against the Chinese state over its blocking of Australian barley sales into China. This was the price for Beijing relenting on this trade weaponisation and agreeing to an internal review of the issues, which has since led to barley sales resuming. 

And in late October in the lead up to his visit, the prime minister announced Australia was suspending its other WTO case against Chinese government economic coercion – this one on wine exports.  Again, the promise from Beijing is an expedited review of its anti-trade measures, dangling hope for resumption of blocked Australian sales into China.

The concession is bigger than the gain from both these Australian government actions.  Australia was going to win formal WTO findings against the Chinese government in both cases, creating two solid international precedents finding that Beijing uses trade as a political weapon. 

If these formal findings had occurred, China would have been under growing pressure to end its coercion.  Australian producers were finding other, less coercive, markets.

More importantly, the WTO cases would have been the trade version of the Philippine Government’s successful case against China on the UN Law of the Sea, which the Philippines pushed to conclusion in 2016.  The Arbitral Tribunal finding in that case has been a cornerstone of the international position that China is acting wholly illegitimately in its territorial seizures and aggression in the South China Sea.  Without this case, the issues would all be much blurrier.

So on trade, both the barley and wine disputes are just bilateral disputes settled without any formal WTO findings – and with no precedents established for other countries to coalesce around and cite in their own trade problems with Beijing.

And Australia is doing its best to ignore Taiwan’s highly justified claim to join the trade agreement, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTTP).As a like-minded liberal democracy, Australia should back Taiwan’s request to join. Rest assured the Albanese government will do nothing for Taiwan – much to Beijing’s pleasure.

Beijing’s benefits outweigh Australia’s by a large margin when it comes to these decisions on trade policy.

The third Albanese government concession to create the path to the Xi-Albanese handshake is the outcome of the latest review of Chinese operation of the port of Darwin that leaves the lease in the hands of Chinese company Landbridge. 

This review conducted at the prime minister’s direction by his department took an extraordinarily narrow view of the issues around Chinese control of this critical northern port in our most strategic northern harbour, focusing solely on regulatory and compliance measures around the port.  By failing to confront the core issue – the constraints that this key port being in Chinese hands imposes on the accelerating military use of Darwin harbour – Mr Albanese created the path to walk away from his clear statements while in opposition that he strongly opposed the sale of the Port of Darwin to Chinese interests. The departmental statement also seems to open the door to less restricted Chinese investment into Australia – a continuing demand from Beijing.

Again, this concession affects not just Australia’s security, but will limit the use of the harbour by our allies and partners – notably the US and Japan – who will not use the Chinese operated port facilities for any sensitive military equipment.  They are too polite to make public statements, but be in no doubt these views will have been raised with Australian officials – perhaps even with Mr Albanese and senior ministers.

The last concession on the road to the handshake is a bigger one – silence. 

Before the May 2022 change of government, there was a growing pattern of Australian government reports of dangerous encounters between Australian Defence Force ships, aircraft and people with the PLA, with PLA ships and aircraft manoeuvring dangerously close and also using weapon targeting lasers on Australian naval ships and aircraft.  This was happening both while the RAN was working in the region with partners on exercises and closer to home.   The last publicly acknowledged incident was in February 2022, when a Chinese guided missile destroyer transiting through Australia’s Exclusive Economic Zone near Darwin used its laser to illuminate a P-8 maritime surveillance aircraft.  

Since the election, either there have been no further dangerous encounters with the PLA by Australian ships and aircraft or the Government has simply chosen not to notice them.  But the odd thing here is that the Chinese military has escalated the aggression and frequency of its close encounters with most other militaries operating in the region this year – including with the US military, the Philippines Coastguard and around Taiwan. And the ADF has been active in exercising in South East Asia and into North Asia.  So, it seems very unlikely the PLA has shown such unique restraint towards Australia. 

Indeed, there are media reports of continuing dangerous behaviour by the Chinese military towards Australia’s, but these are not being revealed or corroborated by Australian officials, apparently because of new ‘operational security reasons’. No doubt the government’s silence is welcome in Beijing, because this normalises Chinese behaviour and reduces united international opposition to it.

Silence on China has also rendered Australian defence policy incoherent. Remember the Government’s Defence Strategic Review, prompted by a major deterioration of regional security? Beijing was and remains the main driver of the deterioration. Our government gets tongue-tied trying to explain regional security without mentioning the “C” word.

And the much hinted at increase to defence spending has been abandoned – justified no doubt in some Canberra circles because our relationship with China is “stabilised.”

The return Australia has from these concessions looks meagre.  One positive is Xi’s release of Australian journalist Cheng Lei after 3 years of unlawful detention in conditions of isolation and abuse.  That leaves two other Australian citizens still being used as political hostages by the Chinese state: the writer and democracy advocate Yang Henjun, who is seriously ill and being denied medical treatment by Chinese authorities, and former Waverly College student, Gordon Ng, who’s been imprisoned by Chinese authorities in Hong Kong since 2021 under Beijing’s repressive ‘National Security Law’, with Australian officials denied consular access to him.

Australian barley farmers and wine companies seem keen to re-establish sales into the China market, accepting the now even higher risk than before that Beijing might again intervene in the trade to punish Australia for any positions of decisions it doesn’t like.  Lobster fishermen are queuing up hoping to restart their own exposure to the China market again. 

The bigger picture here is that our major developed economy partners are moving to lessen their economic dependence on China through ‘de-risking’ – it seems Australia is lonely in trying to move in the opposite direction and re-risk our economy by getting back dependencies we were forced to end by Chinese actions.

There’s one other benefit that Mr Albanese will harvest from his time with Xi Jinping: a place in the Australian Labor Party firmament. The prime minister’s speeches continually evoke past Labor greats – he attributes the US alliance to Curtin, huge strides in industry policy to Chifley, honours Paul Keating even now and often praises Gough Whitlam’s wisdom in establishing diplomatic relations with Mao’s China 50 years ago. 

His visit 50 years on seems to be more significant to him because of this timing.  From a party to party perspective, there’s some logic here: 50 years ago, Gough Whitlam, the leader of the ALP, met with the then Chairman of the Chinese Communist Party Mao Zedong. Now the current leader of the ALP is to meet with the strongest Chinese Communist Party leader since Mao, who appears to be taking the same approach to governing China as Mao did – Xi Jinping.  

From an Australian national interests perspective, though, Mr Albanese has to manage his personal interaction – and even that handshake – quite carefully.  He’s fortunate in having a masterclass of how not to go to Beijing from the recent visit of Californian governor Gavin Newsom.  Governor Newsom, seemingly unburdened by any knowledge of foreign policy, national security or even basic political dynamics involving China, visited as a wide-eyed small town mayor might go to New York.  He looked with awe at the person of Emperor Xi and marvelled at the wonders and history of modern China under the Chinese Communist Party. 

That’s surprising but forgivable in a sub-national leader, but would be a symbolic humiliation if we saw anything like this from our prime minister – as he is no doubt aware. US Secretary of State Blinken’s handshake protocol shows how to keep self-respect and avoid being portrayed as the supplicant when dealing with Chinese counterparts.

The pattern of China policy under Mr Albanese and Penny Wong revealed by government decisions like those on the WTO cases and Darwin Port is that Australia finds ways we can give concessions to China and looks hard to avoid making choices that will anger the leaders in Beijing, including where our national interests are damaged.  We concede where we can and differ only when we absolutely must – as with continuing AUKUS and the US alliance.

This is the working outcome of Mr Albanese’s slogan about managing the China relationship ‘where the principle that I bring to it is to cooperate where we can, disagree where we must, but engage in our national interest.’

The core problem with our government’s goal here – to have a stable, constructive relationship with Xi’s government in Beijing – is that there can be no lasting stable relationship because China is a destabilising power.  That’s what Joe Biden meant when he echoed Ronald Reagan’s characterisation of the Soviets during the height of the Cold War suggesting Mr Albanese ‘trust but verify’ anything out of his visit with Mr Xi.

Mr Albanese’s time in Beijing is only the next waystation in facing the China challenge. Unlike 5 years ago when Australia acted first to ban Huawei from our national telecommunications infrastructure, Australia now has much larger and more aligned company on this challenge. We will need all of this in coming years.

A version of this article was first published by Sky Digital.