Why China Is Falling Out With Australia (And Allies): QuickTake

Photographer: Cameron Spencer / Getty Images

China and Australia have become embroiled in a growing political quarrel turning into trade. Even when some Chinese cities suffered power outages in December, Beijing authorities continued to block coal transport from Australia, underscoring their determination. Miners aren’t the only Down Under exporters finding it harder to access their largest market as tensions build, nor is Australia alone in feeling heat. Other countries that have clashed with China, including Canada, the UK and India, have joined Australia to boost cooperation and intelligence sharing, while the US president-to-be has promised a more united front against Beijing.

1. What did the China-Australia spat about?

The bands have been in a downward spiral since 2018 when Australia accused China of interference in his home affairs, passed one new law against foreign interference and espionage. It is also out of the question Huawei Technologies Co. of building the country’s 5G cellular network, one of the first countries to do so, citing national security. The mood deteriorated in April after Prime Minister Scott Morrison’s government called for an international investigation into the origin of the coronavirus that causes Covid-19. Then in November, a Chinese Foreign Ministry spokesman tweeted an edited image of an Australian soldier holding a knife to the throat of an Afghan child – a barbed reference to an ongoing war crimes investigation. At a time when Chinese “Wolf warrior ”diplomats are getting more and more combative, Morrison the request for an apology was declined.

2. What has the economic impact been?

Considering China is Australia’s By far the largest trading partner, the impact was relatively minor – although the individual sectors affected would differ. From May, China put crippling tariffs on Australian barley; banned beef from four major meat processors; launched an anti-dumping investigation into Aussie wine that led to huge levies; and told importers to stop buying cotton and lobsters. Timber exports were banned and at least $ 500 million worth of coal was delayed for months outside Chinese ports – apparently one of the catalysts for the power outage. While the reprisals have generated numerous headlines and prompted some exporters to call for Morrison to come back, the combined impact as of January was a loss of just 0.3% of Australia’s gross domestic product, or A $ 6 billion ($ 4.7 billion), according to government figures. The sale of iron ore, the country’s largest dairy cow, is still thriving.

3. Why is China doing this?

After months of embezzlement, the Chinese Embassy issued a list of 14 grievances in November. They include Australian decisions to reject Chinese investments for national security reasons, providing funding to what it sees as an anti-Chinese think tank, and ‘relentless deliberate interference’ in Chinese matters related to Taiwan, Hong Kong and Xinjiang, and in the South Chinese Ocean. It also cited allegations of racist attacks on Chinese people and accused the country’s independent media of being hostile. But state-sponsored scholars in China have said that the most vicious authorities in Beijing are Morrison’s urge to let independent researchers into Wuhan, which they see as a contempt for Chinese sovereignty, as well as his government’s willingness to echo and coordinate with US President Donald Trump’s anti-China campaign. “To be honest, we have heard too many negative voices and seen several negative movements from the Australian side,” Foreign Minister Wang Yi said in December. President Xi Jinping’s government has a track record of using trade like a bat, with South Korea, Japan, and Taiwan have all faced reprisals in recent years.

4. Is there a way out for Australia?

It’s not clear. Chinese diplomats and state media have said so until the Canberra government to re-establish ties, but they have not made it publicly clear which Australian measures would be sufficient to reverse the trade crackdowns. Chen Hong, director of the Australian Study Center at East China Normal University in Shanghai, said China is unlikely to withdraw until it sees substantial actions, not just rhetoric. Morrison has indicated that he is unwilling to respond to any of the 14 grievances; he and his ministers seem to be waiting for China to lower the temperature, so a new one “settling point ”can be found in the relationship. Meanwhile, at the end of the year, Australia said it would be formally done challenge China to the World Trade Organization.

5. Is Australia the only country it targets?