China blunders and the fallout
Just at the moment the government claimed vindication for a big win on the world stage, China ridiculed its grandstanding. A terse, one-paragraph statement from its Canberra embassy called Australia’s response “a joke”. If anything encapsulates how fraught relations are with our biggest trading partner, this was it.
The claim that the world backed Australia’s calls for an independent inquiry into the coronavirus pandemic is without doubt overblown self-congratulation. For one thing, the resolution that won unanimous support at the virtual World Health Assembly this week was not ours. It was proposed by the European Union – Australia was one of the 137 countries that co-sponsored it. We were active – along with others – in hammering out the final wording.
When the Chinese embassy said the draft resolution was “totally different from Australia’s proposal”, it was not far off the mark. China is not targeted or mentioned by name – the virus is. There is no inquiry independent of the World Health Organization – the WHO will play the facilitating role in setting it up, despite Foreign Minister Marise Payne last month saying the review should not be conducted by the WHO because “it strikes me as somewhat poacher and gamekeeper”. And there is definitely no suggestion of health inspectors with “weapons inspector”-type powers – which is what Scott Morrison had earlier proposed.
There is every appearance that the prime minister blundered into characterising the WHO in the same way embattled United States President Donald Trump had. Except Morrison had no reason to accuse China of a cover-up as a way of deflecting attention from his handling of the virus. Unlike the US president, the prime minister has won overwhelming approval for his conduct during the crisis, as the latest Newspoll found.
Australian epidemiologist and adviser to the international health organisation Professor Mary-Louise McLaws says that in February China welcomed in an independent team of experts from the US, Russia, Singapore and other countries. Under the protocols of the WHO, the body takes guidance from its member states on the severity of outbreaks. McLaws told ABC TV that she can understand why China now wants to wait until the pandemic is over before welcoming further inquiry, because “they are very busy” coping with the crisis. She says it will probably “go ahead in the near future”, and that setting up these teams “takes time”.
Marise Payne has changed her tune. She accepts there are a number of independent bodies within the WHO with the expertise for a thorough inquiry. As to what the independent oversight advisory committee will look like, Payne says we will “have to step that through”.
The Chinese embassy said a close look at the draft can “easily” show that Australia’s proposals, which were really only thought bubbles when they were originally proposed, did not win endorsement. “All those who know the consultation process that led to the resolution understand this,” the statement said. It concluded: “To claim the WHA’s resolution a vindication of Australia’s call is nothing but a joke.”
Our longest-serving Foreign minister, Alexander Downer, was shocked at the strength and rudeness of this response. He told RN Breakfast he didn’t think it reflected well on China, and that’s “not the way to behave in international diplomacy”. He said Beijing had to learn that this “warrior wolf diplomacy” leads nowhere any good for China.
Downer praised Morrison and Payne for doing “a fantastic job” and in the end getting “the investigation that we wanted”. This view is certainly not shared by other former Foreign ministers, such as Julie Bishop and Gareth Evans; nor does it impress everyone on the government backbench. Ironically, China hawks, including Senator Concetta Fierravanti-Wells, attacked the outcome for being “watered down” and not having a “reference to China”. Others believe Morrison blundered into an unnecessary provocation of China at the expense of our farmers and primary producers.
Downer admitted that dealing with China is much more difficult than it was for him and the Howard government 13 years ago. President Xi “is much more assertive”, he says, but he is optimistic China will “eventually” come to a more “constructive phase in their diplomacy”. Downer seemed to suggest that staring down the bully was the way to achieve this – something he didn’t do much of himself in his 11 years in the job.
The day China endorsed the coronavirus inquiry and pledged $3 billion to assist its work, two other major events took place: Trump threatened to permanently cease funding the WHO, and Beijing announced a whopping 80 per cent tariff on our barley exports for five years. The trade is worth about $600 million a year, with 88 per cent of it coming from Western Australia. That state’s grain growers are angry they are paying the price for the federal government’s fight with Beijing over the pandemic. The West Australian ran a front page attacking Canberra, with the headline “They weep what you sow”. The paper quoted one farmer saying, “Who has upset China to make them act unreasonably? It hasn’t been the farmers, but we are paying the price.” Another said: “The Australian and Chinese relationship needs to be respected very carefully.”
Maybe to minimise the fallout, or simply to duck the flak, Morrison left it to his ministers to face the music, retreating to his bunker for much of the week. Trade Minister Simon Birmingham’s office released a transcript of Birmingham’s Today interview, with the topic listed as “Trade war with China”. Birmingham and Agriculture Minister David Littleproud spent the next two days denying that any such war existed.
Despite the baying of the China hawks, Littleproud said Australia would not retaliate against China for imposing the crippling tariffs. He told Sky, “A trade war benefits nobody. You only have to see what happened between the United States and China.” Instead Australia will lodge an appeal with Beijing within 60 days, in the hope of persuading them that our farmers aren’t subsidised or dumping their product below market rates. Otherwise, the messier and longer process of going to the World Trade Organization will be pursued.
It’s all a very raw nerve for the government and our farming sector. There is a strong belief that Australia has become collateral damage in a larger fight involving the US and China.
China’s targeting of American farm produce in retaliation for Trump’s tariffs cost the US economy $US28 billion. Trump blinked first and at the G20 in Osaka last year hammered out a ceasefire. It led to China agreeing to a mandated $US200 billion purchase of American imports over two years, including $US32 billion in agriculture. It is understood China agreed to start importing American barley and blueberries. Labor’s Anthony Albanese says the government should be confronting the US about the circumstances of the agreement and “whether that has disadvantaged Australia”.
Birmingham assured Fran Kelly he would watch “what happens in relation to the China market very, very closely and where and how they source their future barley and grains”. Just what Australia could or would do about it is far from clear. Both the superpowers are big enough and ugly enough to ignore the rules – and in Trump’s case, his friends.
The Trump–Xi Jinping agreement throws into bold relief just how different the current competition between “Communist” China and democratic America is from the old Cold War paradigm. The Soviet Union was never a powerful actor in the economies of the West, let alone Australia’s. It makes it so much more complicated trying to advance our economic security and strategic security at the same time.
The economic devastation of the coronavirus pandemic, and the reset the prime minister is beginning to talk about, will ignore this reality at our peril. Next week, in a “headland speech”, Morrison will outline the need for longer-term reform with a warning we can’t revert to the way we were doing business pre-Covid. He is certainly right in regard to China. The relationship has been on the slide in a serious way for much of the past three years.
Even though there is some consolation from the fact China will need our iron ore, coal and natural gas in its recovery – indeed, its demand for these commodities has been rising in recent months – the fresh threats of trade sanctions against Australian wine, seafood, oats, fruit and dairy could cause acute pain. This is made all the more severe by the hit our international tourism and education export sectors are already suffering.
The Morrison government is talking up the coronavirus inquiry this week, but it will do nothing to restore the jobs and hours of the 2.7 million Australians who have lost work in the past month.
This article was first published in the print edition of The Saturday Paper on May 23, 2020 as "Don’t mention the war".
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