Weeks of 11 December 2022 to 29 January 2023

Welcomed back to BCB for 2023!

After an extended break for the Australian summer, BCB is returning to its regular fortnightly programming. The format and schedule will likely remain largely the same this year. But given recent shifts in China’s approach to Australia (and perhaps some of its other key foreign relations), BCB will probably be more focussed in 2023 on unpicking what’s motivating developments in China’s statecraft. Though, rest assured, there’ll still be regular doses of speculation about politics in Canberra and unsolicited policy advice for the Australian government.

In this first edition for 2023, I won’t try and canvass the granular details of each and every development in Australia-China relations from the last two months. Instead, what follows is an effort to unpick what might have prompted recent shifts in China’s approach to Australia. What caused China to ease its campaign of diplomatic and trade coercion? What role (if any) did the Albanese government’s shift in tone on China play? And what explains China’s public downplaying of its expectations of Australia?

Enjoy! And, as ever, hate mail and encouragement are equally welcome.

Beijing’s about-face

China’s Ambassador to Australia, Xiao Qian, speaking at a media reception on 10 January:

“2022 was an extraordinary year for China-Australia relations. Thanks to the efforts from both sides, China-Australia relations have gone through difficulties and regained positive momentum.”

Quick take:

The last two months have seen a rapid (though certainly not complete) recovery in the Australia-China relationship. In December 2022, Canberra and Beijing agreed to what effectively amounts to the planned (though, of course, not yet fully realised) reopening of a wide range of previously closed high-level diplomatic channels. Per the readout from the foreign ministerial meeting in Beijing on 21 December, the “two sides agreed to maintain high-level engagement, and to commence or restart dialogue in areas including: bilateral relations, trade and economic issues, consular affairs, climate change, defence, and regional and international issues.” The only conspicuous absences from this list were the Annual Leaders’ Meeting and the Australia-China Human Rights Dialogue. And there are signs that both of those mechanisms could be revitalised in 2023 per recent press reporting and Prime Minister Anthony Albanese’s mooted visit to Beijing later this year.

Meanwhile, this month has seen a flurry of indicators that China’s trade restrictions against a range of Australian exports could be dismantled in the coming months. Commercial (e.g., here and here) and political signals suggest that at least some Australian coal and lobsters will be moving into China again. Meanwhile, Minister for Trade and Tourism, Don Farrell, continues to emphasise that on barley and wine, Australia “would much prefer to sort out our disagreements with China through discussion and not having to take this arbitration through the World Trade Organization.” Ambassador Xiao has reportedly said such a move would be a “good idea” and that talks to that effect are underway between Australian and Chinese officials.

Minister Farrell also stressed in December last year that the “signs are good … [t]he signs are very positive” that these and other trade blockages can be dismantled. In the latest in a series of high-level Australia-China meetings and calls since June 2022 (at least ten at the ministerial level and above by my count), Minister Farrell is slated to connect next week via video link with China’s Commerce Minister Wang Wentao. Given the array of substantive policy disagreements that still beset bilateral ties, the relationship is likely to remain fractious for the foreseeable future. But at the very least, it appears that we are in the early stages of diplomatic contact resuming its regular rhythm and we’ll potentially even see some trade restrictions falling away.

The speed at which China has been willing to restart diplomatic dialogue with Australia and publicly signal the easing of trade restrictions is on its own striking. But it’s especially conspicuous considering that it was only a few months ago that Beijing was issuing lists of expectations that apparently needed to be met before bilateral relations would get “back on the right track.” The rapidity of Beijing’s backflip is made all the more startling considering that the Albanese government hasn’t reversed any of its predecessor’s policies, which so deeply aggravated China. (Though, to be fair, there’s reason to suspect that Canberra has compromised in Beijing’s favour by holding off on targeted sanctions against Chinese officials implicated in severe human rights abuses in Xinjiang.)

All of this makes the last two months of Australia-China relations as confusing as they are warm. Canberra hasn’t reversed China policy positions that Beijing apparently previously saw as a prerequisite for relationship repair. Yet diplomatic ties are on the road to normalisation and there are signs that trade relations could follow a similar trajectory (though this is far from guaranteed). This begs an obvious question: How do we explain this significant course correction in China’s approach to Australia?

Minister for Foreign Affairs Penny Wong meets Foreign Minister Wang Yi on 21 December 2022 [twitter.com/@SenatorWong]

Tone matters (but maybe not in the way one would imagine)

Prime Minister Albanese responding to a question from a journalist on 23 December 2022:

“We’ll continue to engage diplomatically, without a loudhailer.”

Quick take:

The simplest and neatest explanation for China’s willingness to start repairing the relationship might simply be that the Albanese government’s changed tone was enough to appeal to the Chinese government’s diplomatic sensitivities and persuade Beijing that Canberra was now a partner with which it could reliably reengage. As I’ve previously suggested, elements of the Albanese government’s changed messaging on China likely appealed to Beijing. But I’m not convinced that Canberra’s changed tone prompted the current relationship repair. To be sure, these two developments (i.e., Canberra’s changed tone and the relationship repair) are pretty neatly correlated. But that’s not necessarily reason to imagine that they’re causally connected.

Although the Albanese government has consciously and consistently sought to “act diplomatically” and engage with China in a “respectful way,” the last two months are still puzzling to my mind. For one thing, Canberra’s changed tone can’t obviously explain why as late as September 2022 (well after the Albanese government started using softer language to talk about China), Beijing was still issuing substantial lists of expectations. Of course, it’s possible that Beijing was waiting for Canberra’s less adversarial rhetoric to become an established pattern before deciding to normalise diplomatic ties and start talking about removing trade restrictions. But if the Albanese government’s softer China language had such a big impact on the Chinese government’s approach to Australia, it still seems odd that Beijing would be issuing long lists of expectations in September 2022 after Canberra had been going (at least relatively speaking) softly-softly on China rhetoric for months.

On top of that, the Albanese government’s softer China messaging has been neither consistent nor that far-reaching. After seemingly deciding to drop the emotive term “economic coercion” shortly after the May 2022 federal election, the term was subsequently revived by Albanese government ministers from September 2022 onwards. Similarly, while the Albanese government has stopped making comparisons between China today and Nazi Germany in the 1930s, Minister for Defence Richard Marles regularly makes his own critical World War II comparison by couching concerns about China’s military build-up in terms of it being unprecedented in the post-war era. Moreover, other ministers have used language that would likely rankle Beijing. For example, Minister Farrell offered this invidious comparison between Australia and China on 18 January: “I mean we have different political systems; they’re an autocracy, we’re a democracy.” Regardless of whether one thinks this is a fair assessment, it is starkly at odds with how the Chinese Communist Party thinks about its own system of government. Although the arrival of the Albanese government ushered in a change in tone on China, the break with the Morrison government’s rhetoric isn’t as great as one might expect.

Most importantly though, the idea that the Albanese government’s changed tone on China prompted relationship repair is hard to square with Beijing issuing diplomatic overtures as early as December 2021. China’s positive messaging towards Australia began subtly at the end of 2021 but quickly became much louder and more conspicuous with the arrival of the new Chinese ambassador in January 2022. This sunnier signalling began during the Morrison government’s tenure and preceded the Albanese government’s tonal shift on China by nearly six months. If the Albanese government’s changed tone on China was such an important factor in shaping Beijing’s approach to Australia, then why did the Chinese government start taking a noticeably gentler tone on Canberra almost half a year before Labor won the 2022 federal election? (Of course, it’s possible that Beijing was confident that Labor would win the election and that the Chinese government was laying the groundwork for relationship repair under a new Labor government with its diplomatic overtures starting in December 2021. Although that hypothesis is worth considering, this line of thinking takes us into pretty speculative territory that we probably can’t easily traverse here in the open source.) In short, the idea that Canberra’s softer China messaging prompted relationship repair sits oddly with Beijing’s repeated and public expression of expectations in mid-2022, the Albanese government’s overall modest shift in tone, and the timing of the Chinese government’s original diplomatic overtures to Australia.

Does this mean that the Albanese government’s disciplined and cautious messaging on China has been unimportant in the tentative rehabilitation of the Australia-China relationship? In a word, no. Rather than being the development that caused China to shift its approach to Australia, my working assessment is that Canberra’s changed tone made it more politically and diplomatically tenable for Beijing to pursue its desired relationship repair with Australia. In other words, the Albanese government’s softer rhetoric on China may have provided part of the political and diplomatic cover that Beijing wanted to justify its planned easing of diplomatic and trade restrictions.

Given Beijing’s diplomatic overtures from December 2021 onwards, it’s reasonable to speculate that China wanted to rehabilitate ties with Australia long before the May 2022 federal election. But Beijing might have equally judged that it couldn’t allow the relationship to repair without getting something in return from Canberra. With the Albanese government rallying around the policy positions of its predecessor, Beijing realised that it wouldn’t be able to extract substantive policy concessions from Canberra regardless of who won the 2022 federal election. So, to pursue relationship repair, Beijing needed to look for other less tangible wins. Enter the Albanese government’s disciplined and cautious messaging on China. Or, in the words of Minister Farrell, the Albanese government’s concerted effort to have “a much more responsible relationship with China.” Combined with the political demise of Beijing’s bitter sparring partners in the Morrison government at the May election and the positive symbolism of the 50th anniversary of the establishment of diplomatic relations between China and Australia, Beijing had the grounds it needed to start thawing its diplomatic and trade freezes.

If correct (as always, a big if), the above account doesn’t mean that the Albanese government’s disciplined and cautious messaging on China had no influence on the development of Australia-China relations in the last eight months. But it does mean that Canberra’s changed tone probably didn’t prompt China’s decisions to ease its campaigns of diplomatic and trade punishment. Rather, the Albanese government’s China messaging might have made it more diplomatically and politically palatable for Beijing to pursue its preferred policy of restarting diplomatic and trade ties. Drawing solely on the open-source record, we may never know what really motivated Beijing to change its approach to Canberra. But this issue can’t be ignored given its implications for both our understanding of China’s statecraft under President Xi Jinping and how Australia and other countries should manage China’s future campaigns of diplomatic and trade denial.

Prime Minister Anthony Albanese speaking at the Woodford Folk Festival on 28 December 2022 [twitter.com/@AlboMP]

Explaining away China’s expectations of Australia

China’s Consul-General in Sydney, Zhou Limin, speaking in December 2022 about the 50th anniversary of the establishment of diplomatic relations between China and Australia:

“China is ready to work with Australia to translate the leaders’ consensus into concrete actions to promote the bilateral relations and create favourable conditions and atmosphere for their sustained, sound, and steady growth.”

Quick take:

But what of China’s list of expectations? If at the end of 2021 Beijing was already aiming to pursue relationship repair, then why did China repeatedly issue lists of expectations to the Albanese government in mid-2022? Among other pithier expressions, these expectations were enumerated in JulyAugust, and September 2022. The public non-expression of these expectations in recent months is made all the more noticeable by recent Chinese government messaging. Lists of expectations have been replaced with nothing less than a list of reasons for being bullish on the future of Australia-China relations, as well as positive statements about all the complementarities between Australia and China (e.g., hereherehereherehere, and here). One possibility for why these expectations are no longer publicly expressed is that Beijing was previously just taking a punt that the Albanese government might actually reverse elements of Australia’s China policies in a bid to repair ties. And when Beijing realised that this wasn’t going to happen, it pivoted and dropped its public expression of expectations and continued with its planned relationship repair regardless.

Another explanation might come from the vague nature of Beijing’s expectations. Although China publicly articulated a list of first four and then five expectations, they were never precisely detailed. They were typically vague: along the lines of creating “a favourable atmosphere” and consolidating “collaborative relations of mutual benefit.” Perhaps Beijing purposely kept its expectations of Canberra ambiguous so as to allow for precisely the kind of scenario in which Australia didn’t reverse its China policies, but Beijing still wanted to repair the relationship? In other words, China foresaw that Australia might not bow to pressure and so kept its expectations unspecified so that Beijing wouldn’t be boxed into waiting for Canberra to reverse specific policies before relationship repair could begin.

As I’ve previously written, the recent non-expression of these expectations publicly doesn’t mean that they’ve disappeared. Beijing may yet revive them depending on how Australia-China relations develop. Indeed, recent hopes vis-à-vis Australia’s “business environment for Chinese enterprises” and Canberra adhering to a “correct understanding” of China suggest that the Chinese government’s expectations may not have been abandoned entirely. But the typically vague manner in which they were articulated in 2022 has at least allowed Beijing to let them fall mostly by the wayside (for now) and continue relationship repair despite Canberra not having reversed any of the policy positions that so frustrated the Chinese government.

The above certainly isn’t the only plausible account of Beijing’s shifting approach to Australia and the role of Canberra’s changed tone in recent developments in bilateral ties. But it’s my attempt to tentatively (and hopefully in a not totally unpersuasive way) knit together a number of incongruous datapoints. Everything I’ve suggested here is based purely on open-source material. For any readers who might have other sources of information, please feel free to tell me how wrong I am, preferably with a wink and a nudge. As usual, I’d welcome any suggestions of evidence that doesn’t fit with the story I’ve told or counterarguments to what I’ve written.

As always, thank you for reading, and please excuse any errors (typographical or otherwise). Any and all objections, criticisms, and corrections are very much appreciated.