Stabilisation of relationship with China see-saws after five-year icy age
9 Feb 2024|

The five-year icy age between Australia and China has wound down. The leaders have met, and enough fitful warmth has returned to melt a few icicles.

The icy age can be mapped and dated as running from 2017 to 2022.

The emerging era, though, still has plenty of iciness. A renewed chill hit with the news of China’s suspended death sentence on the Australian citizen, Dr Yang Jun.

Penny Wong’s press conference on China’s decision was a notable display of the foreign minister in steely-anger mode. Take the temperature from the first six paragraphs of her media statement: Australia is ‘appalled’ at the ‘harrowing news’ which causes ‘acute distress’. The ‘many years of uncertainty’ since Yang’s detention in January 2019 were ‘extraordinarily difficult’ and the Australian government ‘will be communicating our response in the strongest terms’.

What’s changed compared to the five-year icy age is that Australia will be able to speak to Beijing at the highest level; the calls should be taken even if the message is rejected. The punishing previous age of no-talk-no-contact is ebbing, but these new times of ‘stabilisation’ can still see-saw.

The stabilisation imperative meant Wong swatted away questions about Australia withdrawing its ambassador from Beijing in protest (Canberra has no interest in returning to that no-talk-no-contact iciness). And the stabilisation ambition saw Wong swiftly step over a question about whether Australia still wants to host a visit this year by China’s president or premier.

The fact that such a visit is even on the cards is part of the stabilisation success—the see-saw has its ups.

To see what Australia and China face, map the features of the icy era, a fraught history that will shape and limit future expectations.

The chill that ran from 2017 to 2022 is the fifth China-Australia icy age in 70 years. Here are the four previous icy ages:

  • 1949-72: Australia refused diplomatic recognition of the People’s Republic
  • 1989-91: Australia stepped back in shock and anger at the Tiananmen Square massacre
  • 1996: China probed and punished the newly elected Howard government for alleged offences over the US alliance, Taiwan and the Dalai Lama
  • 2008-09: China lashed out at Kevin Rudd (Lu Kewen) because the Mandarin-speaking leader sought to be a zhengyou—a true friend who ‘offers unflinching advice’. Rudd’s sharpness on China was expressed in the 2009 Defence White Paper.

Since diplomatic recognition in 1972, the five-year icy age is the longest and broadest, touching every area of the relationship.

The early frostiness in 2017 was marked by Australian pushback. Describing China as a ‘frenemy’, Prime Minister Malcolm Turnbull offered a ‘dark view’ of a ‘coercive China’ seeking regional domination. A Labor senator fell for doing China’s bidding because of political donations from Chinese business.

Turnbull introduced legislation on foreign interference in December 2017, stating the Chinese Communist Party worked covertly to interfere with the Australian parliament, media and universities. The law banned foreign political donations and broadened the definition of espionage. Turnbull responded to Beijing’s anger by using a defiant line from Mao Zedong’s 1949 victory statement: ‘The Australian people stand up.’

Chinese pressure sunk Quad 1.0 in the first decade of the century. In 2017, Chinese pressure got the band back together, as the United States, Japan, India and Australia formed Quad 2.0.

By 2018, Canberra was sounding loud alarms—in public as well as privately–at China’s challenge to Australian interests in the South Pacific. An old Canberra line is that some regional governments can’t be bought but they can be rented. Today’s version is that China wants to do more than rent; it wants a lease.

Beijing got heartburn at Canberra’s refusal to join the Belt and Road Initiative. In the week the Liberal Party toppled Turnbull as PM in August 2018, Australia became the first nation to ban ‘high risk’ vendors (read: China’s Huawei and ZTE) from building its 5G network. Barring China from the 5G build, Turnbull later wrote, was ‘a hedge against a future threat: not the identification of a smoking gun, but a loaded one.’

Australia’s call for an international inquiry on the origins and development of the Covid-19 pandemic in April 2020 took the chill to its iciest place. For China’s Xi Jinping, facing the greatest crisis of his leadership, this was getting personal.

By November 2020, China’s embassy in Canberra was talking of Australia ‘poisoning bilateral relations’ and treating China like an ‘enemy’. The embassy gave journalists a list of 14 grievances/disputes where Australia had offended.

The rap sheet was classic China: it’s all Australia’s fault. Beyond the bombast, the 14 points offered a useful list of many positions Australia wouldn’t recant on: Huawei and 5G tech; foreign interference legislation; Xinjiang, Hong Kong and Taiwan.

In 2020, Beijing hit the economic coercion button, slashing purchases of a dozen Australia products from beef and barley all the way down the produce alphabet to wine. The retribution cut the value of Australian trade with China for almost all industries by 40%, costing $20 billion (only China’s huge appetite for iron ore sustained the dollar value of total exports).

At Australia’s federal election in May 2022, the Labor-Liberal foreign policy consensus was crammed into a single phrase: ‘China has changed’. Both parties called for Beijing to start talking again and to cease trade coercion.

With the election of the Labor government, the reset chance arrived. On the day Anthony Albanese was sworn in as prime minister, he boarded a plane to fly to Japan for a Quad summit. Not just China has changed. So have the times. The melt is a slow work in progress.

Date the symbolic declaration of the end of the 5th icy age as November 2022, when Albanese had a bilateral meeting with Xi during the G20 summit in Bali. As with the icy periods during the Hawke, Howard and Rudd governments, the chill begins to ebb when the leaders do grip-and-grin for the cameras and resume the conversation.

Most of the trade sanctions have been lifted. Australia did not bow and China caused minimal economic damage.

Australian exporters shifted to other markets. And China could not do without the iron ore, so the trade surplus with China kept surging, despite the bans. A study by the Productivity Commission found that China failed to ‘impose significant economy-wide costs on Australia’ although individual businesses were hit. The Commission said ‘alternative markets were readily found’ and exports ‘proved to be mostly resilient against these [Chinese] trade measures’.

The seal on the stabilisation effort was Albanese’s visit to Beijing in November 2023, when Xi said he was ‘heartened’ that the relationship had ‘embarked on the right path of improvement’.

The current weather forecast for the relationship see-saw reads: ‘warmer days with the chance of sudden storms’. The diplomatic version is ‘relatively stable and balanced’.

Canberra doesn’t expect to go back to the balmy days before the five-year icy age. The aim is for strategic equilibrium, in the bilateral with China and for the Indo-Pacific.

Some wise owls outside the Labor government talk of the need for ‘détente’. The détente idea was prominent in the statement by 50 prominent Australians (including former Labor foreign ministers Gareth Evans and Bob Carr) calling for Australian middle-power diplomacy to help achieve ‘a balance of power in the Indo-Pacific region in which the United States and China respect and recognise each other as equals’.

Détente between China and the US was what the wise owls want. What the Albanese government seeks is also a form of China-Australia détente. Strip away the Cold War overtones and the détente ambition looks a lot like that ‘relatively stable and balanced’ aim—more sunny days, fewer icy winds.