The Chinese will be ranked second behind the Indians in at least Melbourne and Sydney;a fact Australia’s defence hawks must bear in mind when they predict war in three,13 or 30 years’ time. No Australian leader should ever repeat the mistake that Scott Morrison – the father of AUKUS – made when he needlessly alienated loyal Chinese Australians during his shouting matches with Beijing.
The US and Britain will also rely on migration for the majority of their population growth into the future,but they are decades behind Australia’s diversity. Barely 30 per cent of the American or British people are born overseas or have at least one migrant parent at the moment.
Britain is the weakest link in the AUKUS chain,economically and diplomatically. The reason is Brexit. The latest data from the World Bank reaffirms that both the European Union and Britain are the poorer for it. China’s economy overtook the European Union’s in size in 2021 – the year of formal separation under Brexit – while India’s economy passed Britain’s to become the world’s fifth largest after the US,China,Japan and Germany.
The gap between the US and China continues to narrow. The latest figures show the US accounts for 24.2 per cent of the global economy,while China has 18.4 per cent. This replicates the state of play in the mid-1990s when the US accounted for 24.6 per cent of the world’s GDP and its challenger at the time,Japan,had 17.9 per cent. It was the closest the Japanese came before their long stagnation.
Will China surpass the US,or suffer a version of Japan’s fate as its population ages? If it’s the latter,the next number two behind the US will be India,which is now the world’s most populous nation,and with a much younger demography than China.
Either way,the US has recovered the ground it lost during the global financial crisis and recession. But the twist here is that America’s resilience does not necessarily benefit Australia in our trade disputes with China.
Recall the sanctions that Beijing imposed on us after the Morrison government called for an inquiry into the origins of the coronavirus in 2020. The then prime minister used the meeting of the G7 in Cornwall in June 2021 to rally western leaders to our economic defence. Morrison shared the list of 14 grievances that the Chinese embassy in Canberra said should be addressed before the relationship could return to normal. The G7 was in furious agreement that we should continue to stand up to the bully in our neighbourhood.
As Morrisontold journalists following the meeting:“There is not a country who would sit around that table that would (agree to) concession(s) on any of those 14 points.” The idea for AUKUS was also discussed on that trip,during Morrison’s trilateral meeting with US president Joe Biden,and the then UK PM Boris Johnson.
One would have hoped that the American side would connect the dots and demonstrate their solidarity with Australia by helping our exporters gain access to new markets to replace those the Chinese had shut down. Unfortunately,we were left to navigate the turbulent waters of coercion without the support of our ally.
The good news is that we did manage to reduce our economic dependence on China over the course of 2020-21 and 2021-22 without US assistance. Exports to Japan soared by 66 per cent;to South Korea by 76 per cent;India by 80 per cent and Taiwan by 84 per cent.
But exports to the US fell by 2 per cent. The irony is that our sales to China actually increased by 7 per cent over this period as higher demand for our iron ore,gas and gold covered for the loss of markets for coal,wine and barley. The data which has just been published by the Department of Foreign Affairs and Trade is subject to revision. But it is a reminder of the power imbalance within AUKUS:When Australian and US interests clash,the Americans will always look after number one.
The question for the present,and future is,can Australia trust the US to see the world as we do? If not,will we have the courage to stand up for our interests and even break with our history of military dependency by pushing back against an American call to arms?
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