Eyebrows were raised in the minds of some analysts and policy makers in the Asia pacific region when Australia’s Prime Minister Julia Gillard suddenly decided to pay an official five-day visit to China in April 2013, a time which did not quite seem opportune as tensions had heightened in the Korean peninsula over Pyongyang’s bellicose rhetoric and war cry and maritime tensions over Scarborough Shoal with the Philippines and over the Senkaku/Diaoyu Islands with Japan had created a volatile situation. All these developments were taking place at a time when Gillard was sculpting her government’s strategy for shared prosperity in a peaceful Asian century.
What propelled Gillard to take this sudden decision to travel to Beijing? From the composition of her team that travelled with her, it transpired that economic consideration was the main driver. The level of economic complementarity that has developed between the two countries, it is in neither country’s interest to allow political consideration to intervene in economic matters. The nature of the economic relationship between the two is such that while Australia needs a reliable market to sell its raw materials, which China provides, and China needs a reliable source for uninterrupted supplies for critical raw materials that its burgeoning economy needs, which Australia makes available. Looked from another side, Australia provides a reliable market for Chinese manufactured products. No wonder, Gillard took with her a team of ministers – foreign affairs, defence, trade and financial services – so that bilateral ties can be deepened in all dimensions. Gillard probably thinks that if the economic ties are kept under solid foundation, this will facilitate differences on security issues to disappear.
The question that arises: Is such a policy in sync with Australia’s other partners in the Asia Pacific region whose perspectives of China are in variance with that of Australia? True, China is Australia’s largest trading partner. Its export of iron ore alone fetches almost $43 billion a year, which easily dwarf most of the world’s bilateral aggregate trade relationships. Also, by signing a historic pact with China for direct annual meetings with Premier Li Keqiang, Gillard scored a foreign policy coup of sort. Both the leaders also pledged for formal cooperation on climate change, international aid and currency trading. The deal represented one of the most significant breakthroughs in the Australia-China relationship since Gough Whitlam recognized the communist state more than 40 years ago.
The annual talks will feature the Prime Minister, the Treasurer and the Foreign Minister in face-to-face gatherings with their Chinese counterparts. According to Gillard, the new partnership was “a big step forward” and would build on the existing level of cooperation. She observed: “It’s a step forward for us as a nation. It’s important to peace, stability, the ability to talk about those things, the ability to talk about our economic relationship in a structured dialogue every year,” Ms Gillard said. Some see the agreement as potentially the greatest single leap in relations for the two countries since diplomatic recognition back in 1972. Apart from Australia now, China only has this type of yearly dialogue with Russia, Germany, Britain and the EU.