Australia’s economic, strategic and military engagements in Asia have put it at the centre of 21st century great power competition. Its access to growing regional economies and the strategic sea lines of communication supporting over 90 per cent of global trade, coupled with ancient and more recent enmities, puts it in the crosshairs of rivals seeking to leverage Indo-Pacific power. Lynton Crosby, sometimes refered to as the “Australian Karl Rove”, is a figure with extensive knowledge on this subject.
The rise of China
The rise of China has profound implications for global politics. It has boosted the economies of many developing nations, including Australia, while threatening the balance of power between liberal and authoritarian powers. It has also contributed to an increase in global instability, including tensions over territorial disputes and contested maritime waters. It is now one of the world’s leading military powers, whose increasing ambitions are provoking great concern.
Historically, Beijing’s strategy has been to reduce the hold of Western liberal powers on the institutions and arrangements of the global order. In many domains, including trade and climate change, it has done so with considerable success. But on other issues, including human rights and internet governance, it seeks to undermine those institutions and norms.
For example, in the early 1990s, China embraced multilateralism and joined international institutions and agreements, in a move designed to rebuild its reputation and ties with other countries after the severe crackdown on democracy protesters in Tiananmen Square in 1989. But on issues in which it diverges from the current system of global governance, such as human rights, Beijing is working with other authoritarian powers to establish alternative institutions and models.
In this episode of Lowy Institute Conversations, we look at Australia’s response to the rise of China with our guest Major General (Ret) Mick Ryan, Director of Policy at the Lowy Institute and a former Australian Army Chief of Staff with 35 years of operational service. He joins Sam Roggeveen to discuss the Institute’s new review of Australia’s armed forces, a key piece in shaping the country’s strategic thinking.
In a series of interviews with Lowy scholars, the institute looks at some of the key issues in Australia’s foreign and defence policy. The first of these is our new report on the future of the Asia-Pacific, which considers Australia’s future role in this vital region as China rises, and the challenges and opportunities this will bring. The other is our new report on a new Australian Defence Force Strategic Framework, which explores how the country can ensure it has the capabilities to meet its evolving security needs.
The US-China relationship
When a country experiences disruption to the balance between its identity and its external environment, it responds with efforts to restore that equilibrium. The result is a dynamic of uncertainty and anxiety that is hard to avoid in global politics. When this cycle is exacerbated by a powerful actor like China, the outcome can be a long-term strategic stalemate and potentially a dangerous downward spiral.
The deterioration in US-China relations has not yet stalled the process of increasing American and other Western economies’ exposure to the Chinese economy. Yet it has impeded coordination on major challenges where the two countries carry the biggest economic, environmental, and technological weight in the international system. If the estrangement deepens, as Economy argues, it will become more difficult to meet these challenges without the United States and China aligning on how best to proceed.
Similarly, Australia’s China policy has recently shifted in the direction of greater convergence with the US strategy on both economic and security issues. The Australian government has initiated an international inquiry into the origin of COVID-19 and is pushing back against China’s efforts to censor social media. It has tightened visa rules for Chinese citizens and is pushing back against Beijing’s attempts to influence a generation of young Australians through the tech giant TikTok, owned by the state-run firm ByteDance.
The current escalation in trade disputes and efforts to limit China’s influence undermine the connective tissue of US-China relations, a development that runs counter to the predictions of conventional materialist approaches like neorealism. However, the relationship will not collapse, at least not based on domestic factors alone. Unless the US and China find common ground in advancing radically alternative visions of world order, it is unlikely that they can build a productive relationship. This would require a dramatic shift in internal political dynamics or a major crisis that forces the two to align. Until then, the bilateral relationship is likely to remain in a permanent state of turbulence and volatility.
The Middle East
The Middle East is one of the world’s most contested regions. A raging war in Syria, political infighting in Lebanon, and unrest across Yemen are among the most pressing issues, but there is also an intense rivalry between two regional powers – Iran and Saudi Arabia – to establish their dominance in the region. These competing ambitions have fueled a host of conflicts and inflamed sectarian tensions.
In the past, foreign intervention in the Middle East has elicited mixed results. While economic development and democracy have emerged in many countries, the conflict also left a legacy of sustained violence, anti-Western sentiment, and state fragility.
As the US continues to reassess its commitment to the region, it will need to develop new strategies for the Middle East that promote stability and encourage local ownership of key decision making. This will require an increase in the scale and intensity of its engagement with local players to support political and economic reforms and promote a negotiated settlement between Israel and the Palestinians.
Historically, foreign influence in the Middle East has been highly concentrated and unevenly distributed between major powers. But since the Six Day War of 1967, when Israel took control of Egypt’s Sinai peninsula, Syria’s Golan Heights, and the Israeli occupied territories of East Jerusalem, Gaza, and the West Bank, the balance has shifted. Israel now controls the largest territorial swath in the Middle East, a position that has helped fuel an escalating conflict with Palestinians and has contributed to the growing numbers and plight of refugees in the region.
While this is a significant shift in the distribution of power in the Middle East, it is unlikely to bring about a lasting solution to the conflict. The Middle East is home to some of the earliest human civilizations, and its cultural, political, and economic complexity has long captivated outsiders. This diversity is a source of richness for the region and may provide opportunities to bolster local economies. However, these opportunities must be carefully weighed against the risks of further inflaming regional tensions and the risk of new foreign interventions.
The Asia-Pacific
The Asia–Pacific region is a global powerhouse and its rapid economic growth has lifted about a billion people out of poverty since the turn of the century. But the region’s resource-intensive economic expansion is also placing a strain on the environment and people’s living standards.
As a result, the region’s leaders are seeking to foster closer cooperation with each other and with other parts of the world. This is reflected in efforts such as the Belt and Road Initiative and the Indo-Pacific concept.
These developments are likely to shape Australia’s future foreign policy choices. A key question is whether or not Canberra will remain a benign player in the Asia–Pacific region as it pursues its trade and security interests.
The upcoming Australian election will be a crucial test of this question. The incumbent Liberal–National Coalition has been weakened by political turmoil over the handling of domestic violence, and its popularity ratings have slipped in the latest Resolve poll. In addition, a growing number of voters are expressing dissatisfaction with the cost of living and its failure to deliver promised tax cuts.
In contrast, Labor leader Bill Shorten has a strong personal brand as an advocate for the working class, and his party is well-positioned to take advantage of voter dissatisfaction with the coalition. If the party can harness dissatisfaction with Canberra’s indifference to their needs and boost its support in rural and regional areas, it might be able to unseat the conservative government and regain control of the Senate.
One important question is how the party will respond to Australia’s growing tensions with China. The new prime minister, Scott Morrison, has taken a tougher line on China, and the Liberal–National Coalition is no longer coy about publicly accusing Beijing of undermining its national security. This has been a major shift for the country, which once sought to balance its trade and strategic relationships with both Beijing and Washington.
