Let’s restore the trust in China that we once enjoyed. This was the key message I presented to an online forum titled Does China Threaten Australia’s Peace and Security hosted by the Australian Peace and Security Forum on 18 March. Following is a condensed version of my talk.

In December 1960, the same month that I arrived in Hong Kong as a graduate student, the Australian Wheat Board set aside a Cold War embargo on trade with China and signed a two-year contract to deliver grain to alleviate China’s serious famine. This willingness to trust China was long remembered and often mentioned to me later by Chinese trade officials.

I started work for the Commonwealth Government at the beginning of 1973 and went on to work on various aspects of the Australia-China relationship over the following 25 years. Having survived the ups and down of the relationship, as one might say, through thick and thin, I would like to present a picture of the China that I have watched and engaged with over the decades, from a practical as well as an academic point of view. My conclusion is that the relationship has been beneficial to both sides and that above all it has been built on trust.

One of the most perceptive books about China I have read recently is Yasheng Huang’s The Rise and Fall of the EAST. Huang is a Professor of Management at MIT and has written extensively on management systems in India and China. He argues that the interplay of the EAST – the national examination system that dates from the Sui Dynasty, the imperial autocracy, the structural stability of society, and the role of technology and innovation — have shaped the China of today.

This chimes with my own experience of living and working in, and with, China. Its values differ from ours and we may well feel that our own (imperfect) democracy is preferable to Chinese socialism as defined by Xi Jinping, but it is a stable political system and independent surveys show that its people have a high degree of trust in their government. Over the decades, I have read many predictions of its collapse, but none have proved true.

Beijing leaders have concentric circles of concern, indicating their degree of concern, starting with domestic issues, then neighbouring countries, and then regional and global connections. China is certainly a land shaped by its history and geography. To this must be added the unique experience of the nation and its people in modern times. Its dismemberment in the 19th century at the hands of the colonial powers led by Britain and the United States determined its subsequent international relations policies and practices. These were reinforced by its people’s experience under Japanese occupation in the first half of the 20th century. The lesson of the need to remember the century of humiliation and never to allow it to recur is imparted to every schoolchild. The corollary is that sovereignty and integrity of territory are the basis of nationalism. China’s foreign policy is based on the principle of mutual respect and a determination to regain what is regarded as its rightful place in the world. It is not expansionist or aggressive.

Australia established relations with China in 1972 just as the country was reorienting its international relations and tentatively opening to cultural and political exchanges with the West. The Fraser Government established the Australia China Council in 1979 (I was the first executive director) to advise and encourage greater understanding of China. For over a decade, Australia was a pioneer in many aspects of cultural and economic exchange, from art to accounting, all warmly welcomed by the Chinese people. Both sides then agreed that there were extraordinary benefits to be gained by closer co-operation in trade and investment. China’s first major overseas investment, a joint venture between Rio Tinto and Sinosteel, was signed in 1987. An enterprise of this scale requires trust from all parties concerned and a recognition that all sides would profit from co-operation. As mentioned earlier, trust is at the heart of all sound relationships.

For both Australia and China, the 1980s was a period of globalisation and reform. China, with Australian support, joined APEC and prepared to join the World Trade Organisation. The domestic economy flourished in the new open environment and, from this time on, maintaining strong growth and raising living standards has been the main pillar of Chinese Government policies, reflected in successive five-year plans. Chinese people saw a bright future and developed new self-confidence even as they ventured overseas for travel, study and business.

China trusted the established international governance system, but it soon emerged that the United States did not return that trust. China’s rapid rise and increasing global presence changed the regional and global balance and generated a predictable geopolitical response. American concerns came to a head at the time of the Global Financial Crisis of 2008. Washington noted that it was Chinese investment in the US and Europe that sustained financial stability at this time. For the first time, the US faced a substantial competitor with the capability of being a leading player in the global economy and the international system.

On this side of the Pacific, Australia’s relationship with China continued to blossom and, despite ups and downs, proved that it was vital for our economy. In 2023, China accounted for one third of our total exports, worth a record $219 billion. Now trade barriers that affected exports after 2020 have been removed. Chinese students have returned to Australian universities. High-level visits and meetings have resumed. It is strange therefore that Australians’ trust in China has declined. In my view, this is due to our negative press, drawing on American sources.

In the last 20 years, the Chinese economy has continued to grow, surpassing Japan, to become the world’s second largest. It is a global leader in manufacturing and has made great advances in technology such as AI and robotics. To me, the greatest change in China has been in people’s mentality. The university and college system in China produces 11 million graduates every year. Young people are now part of the international community of ideas and information. They enjoy many more freedoms than their parents, including freedom of employment and movement.

China is now truly integrated into the global economy. National policy has determined this, and, in any case, it would have been inevitable, given the development of advanced technologies and information and communication systems. In the future, the major challenges that the world will face are global. Climate change cannot be tackled without international co-operation. Australia needs more than ever to understand China and its domestic and foreign policies.

There are abundant ways to do this. The recent National People’s Congress set out government priorities, and Foreign Minister Wang Yi gave a briefing on foreign policy at a press conference on 7 March. To summarise his lengthy speech, he presented China as a responsible and stable global power and, without explicitly saying so, drew comparisons with Trump’s America and its chaotic pronouncements.

It is worthwhile quoting Wang Yi a more fully. In answer to questions, he said:

“We are living in a changing and turbulent world, where certainty is becoming a scarce resource. The choices made by countries, especially major countries, will determine the trajectory of our times and shape the future of the world. China’s diplomacy will stand firm on the right side of history and on the side of human progress. We will provide certainty to this uncertain world.”

He made some more points that I summarise:

“We will be a staunch force defending our national interests. …

“We will be a just and righteous force for world peace and stability. …

“We will be a progressive force for international fairness and justice. We will uphold true multilateralism, and bear in mind the future of humanity and the well-being of the people. We will promote global governance that is based on extensive consultation, joint contribution and shared benefit. We will observe the purposes and principles of the UN Charter and build more consensus for an equal and orderly multipolar world.

“We will be a constructive force for common development of the world. We will continue to expand high standard opening-up and share the vast opportunities of Chinese modernisation with all countries. We will safeguard the multilateral free trade system, foster an open, inclusive and non-discriminatory environment for international cooperation, and advance a universally beneficial and inclusive economic globalisation.”

Now some people might say this is government propaganda and reject it. To that I reply, where else will you find such a clear and decisive commitment to a rules-based international order? Surely it at the very least offers a potential way forward for us and for our region. It’s a question of whom we should trust.

https://johnmenadue.com/australia-china-relations-a-question-of-trust/

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