Tom Hyland, international editor at the Sunday Age examines Australia’s scenarios in navigating the challenges of the prospective Asian century and the Washington Consensus. The idea of the centre of economic activity shifting towards the Asia-Pacific forms just one part of the overarching picture.
”While Asia is an economic powerhouse, in terms of politics it’s almost like 19th century Europe… You have interstate disputes, people are still thinking in balance of power terms, there are unresolved conflicts all over the region, from the subcontinent, all over the South China Sea … between China and India, and on the Korean Peninsula… For all those reasons – and the possibility of deep ecological problems which have global consequences, like pandemics – the region is not only a source of security and prosperity, it’s also a source of deep tension and insecurity.” Amitabh Mattoo, former adviser to the Indian government, head of the Australia India Institute.
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Grow up, Australia
By Tom Hyland
If this nation is to play a leading role in the Asian Century, we need to show our neighbours that we are committed, fair-minded and independent.
Source – The Age, published August 12, 2012
THERE are two conflicting visions of the Asian Century and Australia’s role in it. When Julia Gillard looks out she sees new cities where prosperous middle-class Asians live in modern apartments each built with six tonnes of steel made from nine tonnes of Australian iron ore and four tonnes of Australian coal.
They eat food imported from Australian farms, and drink premium Australian wine. They go to Australia for holidays and the world’s best medical services. Their kids are educated here. Our economy booms, peace endures and – in the unlikely event that it doesn’t – our old American friends are always there.
Let’s call this the golden age scenario.
There’s an alternative vision. It involves any one of many potential calamities in what we call ”our” region. Our Asian customers might suffer political and economic collapse that busts our mining boom. Ecological disasters or pandemics might cross borders; so could flotillas of refugees. Things could get worse: we might have a war. Take your pick from the dozens of unresolved disputes stretching from the Indian subcontinent to the South China Sea and the Korean Peninsula. One miscalculation, push comes to shove, and we have to choose: whose side are we on?
Let’s call this the nightmare scenario.
”There are positive and negative influences in this so-called Asian Century: the good, the bad and the ugly all coalesce and come together in this region,” says Amitabh Mattoo, an academic specialist on disarmament, former adviser to the Indian government and now head of the Australia India Institute.
Navigating through the good, the bad and the ugly will test our national ingenuity. Australia faces a delicate diplomatic dance, done while juggling relationships and interests on a high wire above a shifting landscape. It might involve an agonising choice between our US allies and our Chinese customers. It’s likely to define who we are.
Gillard accentuated the positive when she outlined her vision of Australia in the Asian Century at a speech in Melbourne last September. She described Australia entering a new strategic environment. A new China, our largest export market and largest trading partner. A new India, ”rising to find its place in the world and our region”. And a new Indonesia that’s proving Islam and democracy are compatible.
And while there were challenges in achieving her vision, she said Australia could stand strong as a mature and confident power. Gillard announced she had appointed former Treasury boss Ken Henry to draft a white paper to examine likely economic and strategic changes and spell out what more could be done to position Australia for this new era.
When finished, the paper will form a blueprint for policy changes to ”enhance Australia’s navigation of the Asian Century”. The focus of Henry’s review, which attracted 246 submissions, is on ”opportunities to increase the economic and other net benefits to Australia from the global economic and strategic shift to Asia”. In other words: what’s in it for us.
GARETH Evans, former foreign minister, quips that if Paul Keating was asked he’d likely say that ”every galah in every pet shop in the country” is talking about the Asian Century. While Gillard started talking about it last year, the phrase has been traced to Deng Xiaoping and Rajiv Gandhi in 1988.
”They, I think, looked at it in the context of India and China being key global players: after having suffered 150 years of Western humiliation, now it’s time for Asia,” Mattoo says. ”What is clear is that the centre of gravity in all sorts of ways is moving away from the Atlantic, Europe, North America, to this area – the Indo-Pacific or Asia-Pacific region.”
Central to this shift has been the re-emergence of China and India as major powers, and the relative decline of the US. But this image of a resurgence is only part of the picture.
”While Asia is an economic powerhouse, in terms of politics it’s almost like 19th century Europe,” Mattoo says. ”You have interstate disputes, people are still thinking in balance of power terms, there are unresolved conflicts all over the region, from the subcontinent, all over the South China Sea … between China and India, and on the Korean Peninsula.
”For all those reasons – and the possibility of deep ecological problems which have global consequences, like pandemics – the region is not only a source of security and prosperity, it’s also a source of deep tension and insecurity.”
Internally, China and India have massive problems. There are major question marks over how China manages political transition, economic transformation and growing popular discontent.
Mattoo says one of the biggest but often overlooked changes will be demographic: 40 per cent of the world’s population will soon live in the Asia-Pacific region and 50 per cent of the world’s youth will live there, while Europeans, North Americans and Australians grow old. Soon, the Indian subcontinent will be home to 600 million people aged under 25. Any failure to employ those 600 million could feed into the nightmare scenario.
So how does Australia respond to all this? To an observer like Mattoo, part of what Australia confronts is a psychological shift to match its changed strategic circumstances. He says it’s natural that Australia, for historical and cultural reasons, has looked to the West – formerly to Britain, now to the US.
”Now, maybe for the first time, there’s a recognition that it’s maybe in their rational self-interest to look consciously towards Asia, to be seen as an Asian power. And yet there are obvious tendencies which will encourage you not to go the whole hog – so you continue to identify with the strength and stability of the alliance with the US.
”So Australia is still hedging. I think this whole engagement with Asia is born out of concern about the decline of American power, and the economic and other interests that Australia has established in important countries in Asia.”
Mattoo questions if Australia is taking a short-term approach to Asia, narrowly focused on commercial opportunism that tends to see the entire region through the prism of trade with China.
If Mattoo spells out the extent of the challenges, foreign policy veterans like Evans insist Australia’s diplomatic record shows we can engage with the world, and are not just selfishly focused on our own interests.
He says we have proven to be ”decent and committed international citizens, independent-minded and with a real egalitarian streak”. In a recent speech, Evans argued we could draw on these qualities to ensure that ”this wonderful country of ours not only survives but thrives”.
He lists four priorities for Australia at a time when ”the tectonic plates are shifting and every possible kind of uncertainty abounds”. The first thing to do is to avoid a ”zero-sum game” with China and the US. While relations between China (the key to our prosperity) and the US (the key to our security) are ”in reasonable shape”, the huge underlying issue is how the US responds to China’s growth, including in its military capability.
Evans is blunt about where this could lead, and what it would mean for Australia. China, he says, ”is in no doubt at all on which side we would be on if the nightmare scenario of a military confrontation were to arise”.
At the same time, Beijing is realistic enough to know the difference between Australia hedging against possible risks and declaring China a threat. So Australia has to build a working relationship with China, while seeking to restrain America’s language. First off, he says, Americans should be encouraged not to use the ”c” word. China finds it offensive. The ”c” word is ”containment”. It implies China is a threat with unreasonable aspirations that need to be fenced in.
Evans’ second and third priorities are to get relationships with India and Indonesia right. Finally, he says we have to win a seat at major regional and international forums.
While Evans is confident of our ability to navigate through the tricky shoals ahead, John McCarthy, one of our most experienced former diplomats, doesn’t underestimate the complexity of the task . He, like Evans, says we can’t overlook India and Indonesia and other significant players in the neigbourhood – Japan, South Korea and Vietnam.
McCarthy says that ”by and large we’ve tended to get things pretty right”. But in the Australia-China-US triangle things get ”bloody involved and complicated”. He stresses that he is a strong supporter of the US alliance. But ask him how we are seen in Asian capitals, he replies: ”I think over many years now the perception has grown that basically we are the little brother, or that we tend to sort of doff our lid and say ‘yes sir’ when the Americans want something.
”I think that’s a view that prevails in a lot of places. I think it prevails in most of Asia, actually.”
McCarthy says that, in considering when to back Washington, we have to carefully weigh which issues are crucial and which are not. ”I think part of the way we’ve dealt with the alliance has given rise to the view that we’re basically in lock step with the Americans. I’m a very firm supporter of the alliance. I just think we click our heels a bit too often.”
It’s a perception that is not always seen as a negative by some of our neighbours. He says Japan and India might privately see the alliance as a strategic plus, as it helps entrench the US presence as a counter to China. But the perception that Australia is too willing to do Washington’s bidding is not always to our advantage.
”The region doesn’t see that we’re arguing necessarily for our own national interests, but that we’re arguing for somebody else,” he says. ”That means when we make a case in the region, I’m not sure that it’s fully respected, or respected as much as it should be, and I think that’s a problem.”
Garry Woodard has watched Australia’s relationships with Asia virtually since the beginning. He joined the then department of external affairs 60 years ago, when Australian foreign policy was in its infancy. He was appointed ambassador to communist China in 1977, just five years after diplomatic relations were established.
He sees faddism and fear in our approach to Asia. The faddism is reflected in our pursuit of immediate economic interests. The fear is displayed in our dependence on the US.
Woodard says fear now seems dominant, so that we’ve embraced the US in ways he had not expected – our enthusiasm for Barack Obama’s ”pivot” back to the Asian region, and hosting US marines in Darwin.
”I don’t thing there’s ever been a time in our history, except possibly for six months in 1942, when we were so dependent on the United States.”
He finds this surprising, given Labor’s pioneering role in recognising China 40 years ago. He lists a series of missteps by Labor in recent years in which Kim Beazley and Kevin Rudd ”mishandled the relationship extraordinarily”.
From Beazley, there was his secret 2006 declaration to the US, revealed by WikiLeaks, that Australia would always side with the US in the event of war with China. ”This had never been said by any previous government in our history,” Woodard says.
As for Rudd, Woodard says our first Mandarin-speaking prime minister made a litany of mistakes. His public criticism of Beijing’s handling of Tibet, while on a visit to China, was ”a gesture without a game plan”.
Then there was his tough talk on China at a meeting with Hillary Clinton, again revealed by WikiLeaks, the implicit depiction of China as a threat in the 2009 defence white paper, and his profane outbursts against China at the Copenhagen climate talks.
”I hope the Henry review will wrestle with this and get Gillard back to a sensible position, but I think they’re going to find it very hard to do that,” Woodard says. ”I would like to see it at least emphasise that Australia has the capacity to stand on its own two feet. I would like to see that, but I don’t expect that’s what we’ll get.”
Whatever Henry and Gillard come up with, Mattoo suggests we might need a mental shift as much as a policy blueprint if we are to deal with the massive change going on around us.
Engagement with Asia, he says, requires much more than recognising the region is an economic powerhouse we can profit from.
”That equation is not going to work,” Mattoo says. ”This is not the Anglo-Saxon world that Australians are used to. These are societies that are ancient, complex, complicated, with well-entrenched bureaucracies, a political class with a different set of values, and often set in political conditions that Australians aren’t easily able to understand.
”The Asian Century will remain a mirage if you’re not able to unpack it, so you know what it means and what you now have to do. It’s not just about mercantilism, you have to look not just at China and the US, and you have to remember it’s a century. You need to have a 50-year view, a 100-year view. This requires patience, but Australians traditionally haven’t had patience.”