Australia has made a concerted pivot to the Pacific in recent years, in part to counter Chinese influence. Continuing to denounce a nation viewed positively in the region will only weaken Australia’s credibility.

The past five years have been particularly acrimonious for Australia’s relations with China. There’s been a freeze on ministerial meetings since 2017, the government has criticised Chinese foreign and domestic policy, and public opinion has turned sharply negative on China. In 2020, after Australia called for an investigation into the origins of COVID-19 in China, the Chinese government retaliated by restricting the import of products such as wine, beef, and barley. In a further illustration of its “wolf-warrior diplomacy,” the Chinese embassy in Canberra issued a list of 14 grievances against Australia.

Improvement is unlikely in the short term. Prime Minister Scott Morrison referred to Richard Marles, the deputy opposition leader, as a “Manchurian candidate,” implying that the Labor party would coddle China, but the government wouldn’t “have a bet each way” on national security. With the Morrison government trailing in the polls and an election due by May, the Coalition sees its hard-line stance on China as electorally advantageous.

Australia and the BRI: Anxiety triumphs over opportunity

Morrison’s stance on China goes beyond the realm of political partisanship — it suggests that for the government, anxiety about Chinese influence outweighs the perceived economic benefits of engaging with China. Morrison is not the first Australian leader to express unease with China’s growing influence. According to historians David Walker and Agnieszka Sobocinska, Australia has “long known, suspected, or feared that China would rise to world-power status… Defensive gestures have always been accompanied by dreams of untold riches.”

China’s Belt and Road Initiative (BRI) has encapsulated a host of anxieties within the government and the security agencies that advise it. Some have been convinced that China’s rise is antithetical to Australian interests and that American power and the “rules-based order” on which it rests are in decline. It has also raised fears that China is encroaching upon what Australia sees as its “sphere of influence” in the South Pacific and that some of the economic aspects of China’s rise pose a threat to Australia’s national security, for example through new telecommunications technologies.

Australia responds to the BRI in the Pacific

Australia’s most concerted response to the BRI has been the Pacific Step Up, which has seen billions of dollars committed to infrastructure financing in the region. Australia has presented its program as an explicit alternative to the BRI.

Emblematic of these efforts has been the Coral Sea Cable System, a deep-water fibre-optic cable network that links Australia with the Solomon Islands and Papua New Guinea. The Chinese telecommunications giant Huawei, which had been already banned from involvement in Australia’s 5G mobile phone system, was expected to build the cable. But in late 2017, Australia intervened to ensure that Huawei did not get the contract. Instead, the cable system was funded by Australia and completed in 2019.

The Coral Sea Cable System served as the forerunner to the type of projects now undertaken by the Australian Infrastructure Finance Facility in the Pacific (AIFFP), which was created in 2018 with a budget of $2 billion. The AIFFP is part of what the Lowy Institute’s Greg Earl has dubbed the government’s “muscling-up-to-China programs,” which also includes the $3 billion Defence Export Facility and the $2 billion Critical Minerals Facility. In late 2021, the government also found the funds to prevent China Mobile from acquiring Digicel Pacific, the region’s largest mobile telecommunications provider. Rather than see it fall into Chinese hands, the Australian government lobbied and assisted Telstra to buy the company at a cost of $1.33 billion.

 The costs of anxiety

Australia’s interventions in the Pacific illustrate just how seriously the Coalition government sees the threat of China’s rise. Less well documented are the costs that accompany the perceived gains in security.

Responses from the Pacific illustrate that the gains from Australia’s efforts are tenuous at best. In 2019, Dame Meg Taylor, the Secretary-General of the Pacific Islands Forum, and a former diplomat from PNG, said that “forum members view China’s increased actions in the region as a positive development” and the BRI could help create “regional infrastructure and access that could inspire new markets”. More recently, the Papuan Minister for Communications, Timothy Masiu, said he had “no interest” in whether Digicel was acquired by a Chinese or Australian company.

There has also been a significant cost to Australia’s ties with China. Not everything is Australia’s fault here — China’s economic coercion and publication of the “14 grievances” has clearly been excessive, but the Coalition has ignored overtures from China’s new ambassador to Australia for the two sides to “review the past” and “look into the future.”

In Aesop’s famous fable, the bored shepherd boy destroys his credibility by raising false alarms about a wolf attack on his village’s sheep. No one believes the boy when a wolf finally does strike. By continuing to cry “Wolf Warrior“ and seeking to generate political capital from its tough stance on China, Scott Morrison’s government is reducing its credibility both at home and further afield.

Australia is not the only country in the Indo-Pacific to worry about some aspects of China’s rise. Whichever party forms government at the upcoming election would do well to maintain a working relationship with Beijing that can withstand the inevitable ups and downs of regional politics.

David Hundt is an Associated Professor of International Relations at Deakin University. His research interests include the politics and political economy of Asia and the Pacific, especially in Australia and South Korea.

Simon Hewes is a PhD candidate at Deakin University. His research focuses on how states have responded to China’s Belt and Road Initiative with rival initiatives.

Some of the material in this article first appeared in “The battle of the Coral Sea: Australia’s response to the Belt & Road Initiative in the Pacific”, which the authors published in the Australian Journal of International Affairs in early 2022 (see here).

This article is published under a Creative Commons Licence and may be republished with attribution.