Australian Prime Minister’s Visit to China: A New Turning Point in Bilateral Cooperation?

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Australian Prime Minister Anthony Albanese has expressed optimism about the state of relations with China, citing remarkable progress after discussions with President Xi Jinping in Beijing. He reached there on November 4, 2023. This visit, marking the first by an Australian leader since 2016, holds significance as a pivotal moment in thawing tensions amid recent trade and security disagreements. The primary focus of the four-day state visit is centered on trade issues, with Mr. Albanese advocating for the elimination of Chinese tariffs on Australian goods. President Xi, on the other hand, was anticipated to seek increased access to key sectors in Australia. Both leaders have committed to working in the mutual interests of their respective countries, signaling a shift from years of strained relations. During the welcome ceremony at the Great Hall of the People, President Xi emphasized the potential for China and Australia to evolve into trusted partners and praised their progress in enhancing and developing relations. Addressing reporters before the talks, Mr. Albanese emphasized the need for collaboration with China where possible while acknowledging disagreements when necessary, emphasizing national interest. He noted positive signs, citing the removal of certain trade impediments and a substantial increase in trade between the two nations. Responding to questions about trust, Mr. Albanese highlighted positive and constructive engagements with President Xi in the past, despite recognizing differences in political systems, values, and histories. Acknowledging previous disputes, this visit can be tagged as a turning point, opening new avenues for cooperation and marking a positive shift in bilateral relations.

The visit comes in the aftermath of a prolonged diplomatic chill triggered, in part, by Australia’s insistence on probing the origins of Covid-19. This freeze was further intensified by economic sanctions imposed by Beijing on critical Australian exports like beef, wine, and barley. Notably, his trip aligns with the commemoration of the 50th anniversary of Gough Whitlam’s historic journey to China in 1973. This event stands as the inaugural visit by an Australian prime minister following the establishment of diplomatic relations, adding a layer of historical significance to the current diplomatic engagement. However, recent strains in the relationship led to a trade dispute, resulting in China imposing bans on various Australian exports such as barley, wine, coal, and lobsters. This trade impasse resulted in a substantial economic setback for Australia, amounting to AUD $24 billion. Despite these challenges, there are ongoing efforts to mend the relationship, evidenced by the agreement reached between Beijing and Canberra to address trade disputes related to wine and wind towers. China’s Ministry of Commerce officially announced this resolution on October 22, signaling a potential thaw in trade tensions between the two nations.

Against this backdrop, both China and Australia acknowledge the mutual reliance they share in terms of trade and regional stability. Recent developments from both nations underscore this acknowledgment. China is particularly keen on delineating a distinct separation between security considerations and economic engagements. Australia on the other hand tries to engage more in the economic domain changing its focus from the security domain. This analysis will delve into the rationale behind the recognition of their shared significance and the strategies employed to foster this connection. All these will indicate that the current visit is the starting point of the new understanding.

China holds a pivotal role as Australia’s foremost bilateral trade partner in both goods and services, constituting a significant share of approximately 32.2 percent in Australia’s global trade. The trade flow between the two nations saw notable growth of 6.3 percent in 2020-21, reaching $267 billion, despite a 5.0 percent dip in Australia’s overall global trade during the same period. Australia’s exports to China in 2020-21 totaled $178 billion, reflecting a 6.2 percent increase compared to the previous year. This upswing was primarily propelled by a robust 10.8 percent growth in goods exports, although service exports faced a 3.16 percent downturn, largely attributed to the impacts of the COVID-19 pandemic. Besides, the establishment of the China–Australia Free Trade Agreement (ChAFTA) on December 20, 2015, played a crucial role in enhancing Australia’s competitive edge in the Chinese market, fostering economic growth and generating employment opportunities. Both nations are also participants in the Regional Comprehensive Economic Partnership Agreement (RCEP). China holds the position of Australia’s sixth-largest foreign direct investor, while Australia’s foreign direct investment in China amounted to $9.1 billion in 2021. The positive trajectory of China-Australia relations is expected to receive a boost from the recent visit, fostering opportunities for enhanced collaboration and cooperation between the two nations.

In various aspects, Australian Prime Minister (PM) Anthony Albanese’s visit to China can be viewed as a positive development in certain bilateral spheres. His distinction as the first Australian PM to visit China in seven years marks a notable breakthrough in China-Australia relations. The lengthy hiatus in high-level visits, despite the significant bilateral trade volume, underscores the significance of Albanese’s visit as a pivotal moment, indicating the initiation of a new phase in the relationship.

Leading up to Albanese’s visit, China and Australia engaged in cordial discussions addressing WTO disputes related to wine and wind towers throughout the year, ultimately reaching an agreement to resolve these issues. Additionally, Canberra’s approval of the continued operation of the Port of Darwin by a Chinese company, following a security assessment that found no risks, further contributed to the positive ambiance surrounding the visit.

Albanese’s strategic sequencing of visits, starting with the US and followed by China, along with the pre-announcement of his China visit before his US trip, reflects a deliberate effort to mitigate uncertainties from the US visit affecting the China trip. This conscious diplomatic balancing act in managing relations with both China and the US highlights Albanese’s diplomatic acumen. In response to US President Joe Biden’s cautious remarks on dealings with China, Albanese underscored the thoughtful and intentional nature of the decision to re-establish relations with China.

As per Chinese Foreign Ministry spokesperson Wang Wenbin, China aims to capitalize on the visit to enhance cooperation with Australia, emphasizing principles of mutual respect, mutual benefit, and a search for common ground while acknowledging differences. Australia’s endeavors to uphold regional harmony and cultivate productive economic ties with China while addressing security concerns demonstrate its commitment to striking a delicate equilibrium. Similarly, China’s nuanced approach seeks to compartmentalize security issues, safeguarding economic interests to foster mutual benefits. By fostering a positive relationship with Australia, China seeks to reinforce regional stability amid heightened tensions with the US, potentially laying the groundwork for collaborative measures and diplomatic resolutions.

Therefore, Australian Prime Minister Anthony Albanese’s recent visit to China signifies a pivotal moment in bilateral relations, marking progress amid trade and security disputes. The first visit by an Australian leader since 2016, it reflects a shift from years of strained ties. Focused on trade, with calls to eliminate Chinese tariffs on Australian goods, the visit underscores a positive turning point. China and Australia acknowledge their interdependence, navigating a delicate balance between economic collaboration and addressing security concerns. The diplomatic endeavor follows a diplomatic chill, coinciding with historical significance and a changing economic focus toward China. Despite recent challenges, both nations seek to mend ties, presenting opportunities for regional stability and diplomatic resolutions. Though initially perceived as security competitors, the recent visit has transformed the narrative into a collaborative stance. Expectations are high for an upswing in bilateral collaboration, marking a significant turning point in their relationship.

In spite of existing hostilities, the visit of the Australian Prime Minister to China conveys a constructive message to the international community, highlighting that diplomatic efforts have the potential to restore positivity. This underscores the significance of the visit in the context of global affairs.

– Syed Raiyan Amir is a Research Associate at the KRF Center for Bangladesh and Global Affairs (CBGA).

Published in Modern Diplomacy [Link]