{"id":51530,"date":"2019-10-28T15:00:47","date_gmt":"2019-10-28T04:00:47","guid":{"rendered":"https:\/\/www.aspistrategist.ru\/?p=51530"},"modified":"2019-10-28T14:50:56","modified_gmt":"2019-10-28T03:50:56","slug":"australia-and-china-a-view-from-the-us","status":"publish","type":"post","link":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/","title":{"rendered":"Australia and China: a view from the US"},"content":{"rendered":"
<\/figure>\n

Three years ago, I created a minor diplomatic furore<\/a> when I opined, during a live interview broadcast on the ABC\u2019s Radio National Breakfast<\/em>, that the time was fast approaching when Australia might be required to choose between deepening its economic relationship with the People\u2019s Republic of China and its longstanding alliance with the United States. The fact that I had offered only my personal opinion and not an official position of the United States was lost in the storm of indignation that followed.<\/p>\n

I was the topic of a 10-minute briefing to US Secretary of Defense Ash Carter and heard from reliable sources that Prime Minister Malcolm Turnbull himself telephoned the US State Department to complain about me. To the intense displeasure of many observers, the incident had absolutely no impact on my career\u2014though for some reason I have since received a flood of Chinese-language spam emails and robo-calls.<\/p>\n

I did not mention Labor senator Sam Dastyari<\/a> during my interview. Nor did I refer to Clive Hamilton\u2019s research for what became his 2018 book Silent invasion: China\u2019s influence in Australia<\/em><\/a>. My opinion came from my own close study of Chinese military, economic and diplomatic activities in the South China Sea from 2012, including several months spent as a resident fellow at the Australian Strategic Policy Institute in Canberra.<\/p>\n

It seemed to me in 2016, and even more so today, that it might already be too late to protect Australia without some level of economic and social dislocation. From port facilities<\/a> to infant formula<\/a> to commercial real estate<\/a> to agriculture<\/a>, Chinese capital investment has continued to grow and totaled $64 billion in 2018. Much of this money originates from attempts by various Chinese state-owned enterprises to use the returns on foreign investment to recapitalise their own operating losses\u2014or, more insidiously, to acquire technology and experience in an industry or sector for the ultimate benefit of China\u2019s domestic market.<\/p>\n

In an effort to close the tax loophole, the Chinese government increased regulation<\/a> of state-owned enterprises investing abroad beginning in 2017, though notably it didn\u2019t prohibit such investments.<\/p>\n

Overseas investment is central to the realisation of president-for-life<\/a> Xi Jinping\u2019s Belt and Road Initiative. State-owned companies work hand in hand with China\u2019s Asian Infrastructure Investment Bank, now recognised as an explicit competitor<\/a> to the World Bank and the International Monetary Fund. That allows an aid recipient country to access more money with fewer restrictions than it could get from the World Bank or the IMF. In some cases, it appears that the Chinese government has made loans with the full expectation that the money won\u2019t be repaid.<\/p>\n

When the Sri Lankan government couldn\u2019t meet its obligation for loans it received in 2010 to develop a port at Hambantota, it ceded control<\/a> of the facility to China for 99 years (the same terms are included in the deal reached for the Port of Darwin, though it was negotiated under different circumstances). Hambantota is an exemplar of China\u2019s use of the AIIB to fund the BRI through \u2018debt-trap diplomacy<\/a>\u2019. Zambia offers another example\u2014the Chinese succeeded in securing imperialist concessions<\/a> that mirror those held by European powers from the Chinese emperors in the 19th century. At least eight<\/a> other nations are in sufficient debt distress to be vulnerable to Chinese assaults on their sovereignty.<\/p>\n

Of course, anything that\u2019s \u2018state owned\u2019 is by definition a part of the government of its home nation, and can be expected to operate as an adjunct of the government\u2019s domestic and international policy bureaucracies. When the home nation is China, however, and the home government is the Chinese Communist Party, enthusiasm for investment should be tempered by healthy caution. Last year, journalist Rob Schmitz published a lengthy summary<\/a> of the extent of the \u2018inform and influence\u2019 activities the CCP undertakes inside both Australia and New Zealand. Indeed, to read Schmitz\u2019s report (or Hamilton\u2019s book) is to gain a new understanding of the term \u2018fifth column\u2019. For how else can one describe official Chinese government activities than as the deliberate creation of a prepositioned corps of supporters who will act in accordance with Beijing\u2019s wishes whenever and wherever asked?<\/p>\n

Those who believe that the Chinese state under Xi poses no threat to Australia\u2019s sovereignty and independence, or who, like Hugh White<\/a>, have already surrendered, won\u2019t be swayed by these arguments. However, for readers who still have open minds, some recent examples from the region could be instructive.<\/p>\n

First and most obvious is Beijing\u2019s treatment of Hong Kong. The \u2018one country, two systems\u2019 promise appears to be on life support, and the \u2018freest city in Asia<\/a>\u2019 will ultimately be under the domination of a ruthlessly oppressive regime\u2014no doubt aided by technologies stolen from laboratories and industries around the world.<\/p>\n

Second is the recent shift in the Indo-Pacific region against Taiwan in favour of Beijing. Last month, Kiribati and Solomon Islands<\/a> announced that they were withdrawing their recognition<\/a> of the government of the Republic of China in Taipei. Without admitting to any overt pressure from Beijing, Kiribati\u2019s President Taneti Maamau revealed that the decision was based on what was \u2018in the best national interest for our country and people\u2019.<\/p>\n

While it may be true that President Tsai Ing-wen is determined to mitigate such diplomatic snubs by deepening Taipei\u2019s bilateral relationships<\/a> with Washington, Canberra, Tokyo and New Delhi, it\u2019s too soon to tell whether such heavy-handed coercion will result in an anti-Beijing backlash with broad support. Moreover, China\u2019s actions redound to Beijing\u2019s benefit beyond narrow economic interests. Not only has the CCP scored a strategic messaging victory and further marginalised a hated rival, but it\u2019s also that much closer to establishing the conditions necessary to manipulate in its favour the official platforms and programs of international bodies such as ASEAN and the UN (UNCLOS<\/a>, anyone?). That end result runs directly contrary to the long-term interests of Australia, the United States and all others who continue to defend the rules-based international order.<\/p>\n

The capitulation<\/a> to CCP pressure by the US National Basketball Association over Daryl Morey\u2019s support for Hong Kong protesters, and by Paramount Pictures over patches<\/a> on the \u2018Maverick\u2019 character\u2019s flight jacket in the forthcoming movie Top Gun II<\/em>, illustrate the siren call of China\u2019s market for US-based companies eager to cash in. How much greater is the potential for China to engage in economic blackmail of Australia? Let\u2019s hope the Morrison government takes the necessary steps to reduce Australia\u2019s vulnerability now, while (perhaps) there\u2019s still time.<\/p>\n","protected":false},"excerpt":{"rendered":"

Three years ago, I created a minor diplomatic furore when I opined, during a live interview broadcast on the ABC\u2019s Radio National Breakfast, that the time was fast approaching when Australia might be required to …<\/p>\n","protected":false},"author":477,"featured_media":51531,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"footnotes":""},"categories":[1],"tags":[17,1383,52,56],"class_list":["post-51530","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-australia","tag-ccp","tag-china","tag-indo-pacific"],"acf":[],"yoast_head":"\nAustralia and China: a view from the US | The Strategist<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Australia and China: a view from the US | The Strategist\" \/>\n<meta property=\"og:description\" content=\"Three years ago, I created a minor diplomatic furore when I opined, during a live interview broadcast on the ABC\u2019s Radio National Breakfast, that the time was fast approaching when Australia might be required to ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/\" \/>\n<meta property=\"og:site_name\" content=\"The Strategist\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/ASPI.org\" \/>\n<meta property=\"article:published_time\" content=\"2019-10-28T04:00:47+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-10-28T03:50:56+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.aspistrategist.ru\/wp-content\/uploads\/2019\/10\/GettyImages-1064392582-e1572234473575.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"950\" \/>\n\t<meta property=\"og:image:height\" content=\"634\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Tom Hanson\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@ASPI_org\" \/>\n<meta name=\"twitter:site\" content=\"@ASPI_org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Tom Hanson\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.aspistrategist.ru\/#website\",\"url\":\"https:\/\/www.aspistrategist.ru\/\",\"name\":\"The Strategist\",\"description\":\"ASPI's analysis and commentary site\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.aspistrategist.ru\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-AU\"},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-AU\",\"@id\":\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#primaryimage\",\"url\":\"https:\/\/www.aspistrategist.ru\/wp-content\/uploads\/2019\/10\/GettyImages-1064392582-e1572234473575.jpg\",\"contentUrl\":\"https:\/\/www.aspistrategist.ru\/wp-content\/uploads\/2019\/10\/GettyImages-1064392582-e1572234473575.jpg\",\"width\":950,\"height\":634,\"caption\":\"HAMBANTOTA, SRI LANKA - NOVEMBER 16: The extension of the Southern Expressway from Matara to Hambantota continues under construction on November 16, 2018 near Hambantota, Sri Lanka. Extension of the Southern Expressway in Sri Lanka is one of the major infrastructure projects built by Chinese and Sri Lankan workers under the framework of the Belt and Road Initiative. The 96-kilometer project was undertaken by three Chinese companies, with a $1.9 billion concessional loan from the Export-Import Bank of China. As the political crisis escalates in Sri Lanka, former President Mahinda Rajapaksas return to power in late October has been watched with increasing concern by countries including the U.S., China and India. The re-entry of Rajapaksa could and raise the influence from Beijing and alter the power dynamics around the Indian Ocean. During Rajapaksas 2005-2015 presidency, Sri Lanka saw an influx of Chinese investment and economic support since he relied heavily on China for economic support, military equipment and political cover. While ousted Prime Minister Ranil Wickremesinghe sought to balance relations with New Delhi and Beijing, Rajapaksa made clear his willingness to accept Chinese money even in the face of unreasonable terms while reports from the Central Bank estimated the debt owed to China could be as much as $5 billion and growing every year. Chinese investments paid for a new port, a new airport and new railway on Sri Lankas southern coast, among other projects in Colombo, which forced the government to sell strategic assets to Beijing, such as the Hambantota port, when it wasn't able to meet liabilities. For China, the relation with Sri Lanka ties back thousands of years when it was a stop along the old Silk Road trade routes, as it is now known to be a critical link for its Belt and Road Initiative, which aims to expand trade across 65 countries from the South Pacific through Asia to Africa and Europe. (Photo by Paula Bronstein\/Getty Images)\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/\",\"url\":\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/\",\"name\":\"Australia and China: a view from the US | The Strategist\",\"isPartOf\":{\"@id\":\"https:\/\/www.aspistrategist.ru\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#primaryimage\"},\"datePublished\":\"2019-10-28T04:00:47+00:00\",\"dateModified\":\"2019-10-28T03:50:56+00:00\",\"author\":{\"@id\":\"https:\/\/www.aspistrategist.ru\/#\/schema\/person\/f604393e98c6b7693a49f83452c8d0ca\"},\"breadcrumb\":{\"@id\":\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#breadcrumb\"},\"inLanguage\":\"en-AU\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.aspistrategist.ru\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Australia and China: a view from the US\"}]},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.aspistrategist.ru\/#\/schema\/person\/f604393e98c6b7693a49f83452c8d0ca\",\"name\":\"Tom Hanson\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-AU\",\"@id\":\"https:\/\/www.aspistrategist.ru\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/ebab7bffedebd3695d84fe4ced54f3dd?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/ebab7bffedebd3695d84fe4ced54f3dd?s=96&d=mm&r=g\",\"caption\":\"Tom Hanson\"},\"url\":\"https:\/\/www.aspistrategist.ru\/author\/tom-hanson\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Australia and China: a view from the US | The Strategist","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/","og_locale":"en_US","og_type":"article","og_title":"Australia and China: a view from the US | The Strategist","og_description":"Three years ago, I created a minor diplomatic furore when I opined, during a live interview broadcast on the ABC\u2019s Radio National Breakfast, that the time was fast approaching when Australia might be required to ...","og_url":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/","og_site_name":"The Strategist","article_publisher":"https:\/\/www.facebook.com\/ASPI.org","article_published_time":"2019-10-28T04:00:47+00:00","article_modified_time":"2019-10-28T03:50:56+00:00","og_image":[{"width":950,"height":634,"url":"https:\/\/www.aspistrategist.ru\/wp-content\/uploads\/2019\/10\/GettyImages-1064392582-e1572234473575.jpg","type":"image\/jpeg"}],"author":"Tom Hanson","twitter_card":"summary_large_image","twitter_creator":"@ASPI_org","twitter_site":"@ASPI_org","twitter_misc":{"Written by":"Tom Hanson","Est. reading time":"5 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebSite","@id":"https:\/\/www.aspistrategist.ru\/#website","url":"https:\/\/www.aspistrategist.ru\/","name":"The Strategist","description":"ASPI's analysis and commentary site","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.aspistrategist.ru\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-AU"},{"@type":"ImageObject","inLanguage":"en-AU","@id":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#primaryimage","url":"https:\/\/www.aspistrategist.ru\/wp-content\/uploads\/2019\/10\/GettyImages-1064392582-e1572234473575.jpg","contentUrl":"https:\/\/www.aspistrategist.ru\/wp-content\/uploads\/2019\/10\/GettyImages-1064392582-e1572234473575.jpg","width":950,"height":634,"caption":"HAMBANTOTA, SRI LANKA - NOVEMBER 16: The extension of the Southern Expressway from Matara to Hambantota continues under construction on November 16, 2018 near Hambantota, Sri Lanka. Extension of the Southern Expressway in Sri Lanka is one of the major infrastructure projects built by Chinese and Sri Lankan workers under the framework of the Belt and Road Initiative. The 96-kilometer project was undertaken by three Chinese companies, with a $1.9 billion concessional loan from the Export-Import Bank of China. As the political crisis escalates in Sri Lanka, former President Mahinda Rajapaksas return to power in late October has been watched with increasing concern by countries including the U.S., China and India. The re-entry of Rajapaksa could and raise the influence from Beijing and alter the power dynamics around the Indian Ocean. During Rajapaksas 2005-2015 presidency, Sri Lanka saw an influx of Chinese investment and economic support since he relied heavily on China for economic support, military equipment and political cover. While ousted Prime Minister Ranil Wickremesinghe sought to balance relations with New Delhi and Beijing, Rajapaksa made clear his willingness to accept Chinese money even in the face of unreasonable terms while reports from the Central Bank estimated the debt owed to China could be as much as $5 billion and growing every year. Chinese investments paid for a new port, a new airport and new railway on Sri Lankas southern coast, among other projects in Colombo, which forced the government to sell strategic assets to Beijing, such as the Hambantota port, when it wasn't able to meet liabilities. For China, the relation with Sri Lanka ties back thousands of years when it was a stop along the old Silk Road trade routes, as it is now known to be a critical link for its Belt and Road Initiative, which aims to expand trade across 65 countries from the South Pacific through Asia to Africa and Europe. (Photo by Paula Bronstein\/Getty Images)"},{"@type":"WebPage","@id":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/","url":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/","name":"Australia and China: a view from the US | The Strategist","isPartOf":{"@id":"https:\/\/www.aspistrategist.ru\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#primaryimage"},"datePublished":"2019-10-28T04:00:47+00:00","dateModified":"2019-10-28T03:50:56+00:00","author":{"@id":"https:\/\/www.aspistrategist.ru\/#\/schema\/person\/f604393e98c6b7693a49f83452c8d0ca"},"breadcrumb":{"@id":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#breadcrumb"},"inLanguage":"en-AU","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.aspistrategist.ru\/australia-and-china-a-view-from-the-us\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.aspistrategist.ru\/"},{"@type":"ListItem","position":2,"name":"Australia and China: a view from the US"}]},{"@type":"Person","@id":"https:\/\/www.aspistrategist.ru\/#\/schema\/person\/f604393e98c6b7693a49f83452c8d0ca","name":"Tom Hanson","image":{"@type":"ImageObject","inLanguage":"en-AU","@id":"https:\/\/www.aspistrategist.ru\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/ebab7bffedebd3695d84fe4ced54f3dd?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/ebab7bffedebd3695d84fe4ced54f3dd?s=96&d=mm&r=g","caption":"Tom Hanson"},"url":"https:\/\/www.aspistrategist.ru\/author\/tom-hanson\/"}]}},"_links":{"self":[{"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/posts\/51530"}],"collection":[{"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/users\/477"}],"replies":[{"embeddable":true,"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/comments?post=51530"}],"version-history":[{"count":2,"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/posts\/51530\/revisions"}],"predecessor-version":[{"id":51533,"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/posts\/51530\/revisions\/51533"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/media\/51531"}],"wp:attachment":[{"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/media?parent=51530"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/categories?post=51530"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.aspistrategist.ru\/wp-json\/wp\/v2\/tags?post=51530"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}