“Nothing could be further from the truth. In fact,his language on Taiwan in the official readout from the Bali Summit is arguably more hardline than before.”

Xi remains on track to take action against Taiwan sometime in the late 2020s or 2030s,said Rudd,now the President of the Asia Society.

This means Australia needs to remain “clear-eyed” about the potential for military conflict with China,even as it seeks to improve relations in the short term.

“The only way to avert medium-to-long-term conflict is for there to be an effective US,allied and Taiwanese deterrence:militarily,technologically,financially,economically and,of course,in foreign policy and political terms as well,” Rudd said.

The biggest risk in the short-to-medium term is a “war by accident” between the US and China,Rudd said,describing it as a “real and living danger”.

The best way for the superpowers to avoid an accidental war was through a policy of “managed strategic competition”,he said. This requires the US and China to agree on the “strategic red lines” that cannot be crossed without risking a military escalation.

Rudd said Australia’s challenges with China remain “formidable”,even afterPrime Minister Anthony Albanese’s breakthrough meeting with Xi last week in Bali.

Beijing’s previous freeze on all high-level political contact had been “unhealthy for all concerned”,he said,and the resumption of leader-to-leader talks under Labor was “no small feat”.

Beijing would be well-advised to drop trade sanctions on Australian goods worth $20 billion and release journalist Cheng Lei from detention as part of the 50th anniversary of diplomatic relations between China and Australia next month,he said.

“That would pave the way for resumption of normal diplomatic discourse across all the substantive questions which currently confront the bilateral relationship,” he said.

Cut through the noise of federal politics with news,views and expert analysis from Jacqueline Maley.Subscribers can sign up to our weekly Inside Politics newsletter here.