Boomerang against China (Junge Welt newspaper)

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Australia is making the next attack on China: On Wednesday, the right-wing government in Canberra suspended two agreements that the southeastern state of Victoria had concluded with Beijing in 2018 and 2019 as part of the New Silk Road (Belt and Road Initiative, BRI) . The two agreements were “inconsistent with Australia’s foreign policy,” said Foreign Minister Marise Payne to explain; they would therefore be canceled. Since then, as expected, the waves have been racing. China’s embassy in Canberra expressed its “great displeasure and resolute opposition.” Countermeasures are not excluded. The move is also fueling existing tensions within Australia.

Canberra initiated its aggressive confrontation course against Beijing, which the current measure continues, years ago. As early as June 2018, for example, parliament passed a law to ward off »foreign influence«, which puts supporters of cooperation with China under great pressure. As an aside, the law has also been used to warrant a search of the Australian Broadcasting Corporation (ABC) when it was investigating serious war crimes committed by the Australian military in Afghanistan. Australia was the first state to exclude Huawei from setting up its 5G networks in August 2018, and it is also otherwise at the forefront of any US aggression against the People’s Republic. This has earned him a reputation in the region of serving as the “Deputy Sheriff” of the United States. When in April 2020 Prime Minister Scott Morrison, sometimes labeled as “Australian Trump” because of his political proximity to the previous US President, demanded that China should not only allow foreign investigators into the country to investigate the origins of the Covid-19 pandemic, but Granting them the authority of UN weapons inspectors was finally the limit for Beijing.

Since May 2020, the People’s Republic has been fighting back on an economic level – with punitive tariffs and with de facto import boycotts. Gradually, it has reduced or banned the import of coal, barley, wine, meat, cotton and other goods from Australia. That weighs heavily: in 2019, shortly before the start of the Chinese countermeasures, Australia delivered 40 percent of its exports to China. In March 2021, government officials in Canberra took stock before Australia’s Senate – and it became clear that Beijing’s measures are taking effect. It is true that the Australian-Chinese trade volume in the second half of 2020 fell by only two percent compared to the second half of 2019. However, this was because China was still sourcing large amounts of iron ore from Australia; the world market price for this has risen sharply since mid-2020. If you factor out the inflated iron ore share, it becomes clear that the exports of Australian companies to the People’s Republic had collapsed by an average of 40 percent.

That hurts, of course – all the more since it has not always been possible to win new customers. Japan and India are now buying Australian coal: if it goes against China, they do what they can there. But you can’t do everything, and so Australia’s coal exports have plummeted by eight percent. More than 40 Australian cargo ships have been stuck off the Chinese coast for months – in the desperate hope that Beijing might still buy their coal. The Australian Senate learned in March that barley could largely be harvested elsewhere, but wine – an important export good – not; the industry is suffering. In addition, the corona crisis has caused Australia’s exports to the rest of the world to decline by 22 percent. The chance of minimizing the crisis damage by increasing sales in the People’s Republic, which has long since been booming again – German companies, for example, are doing that – is denied to the Australian economy.

And now? While Australia’s Trade Minister Dan Tehan is desperately looking for new sales markets and is currently on a trip to Europe, Prime Minister Morrison continues to turn the escalation screw with the cancellation of the two Silk Road agreements of the state of Victoria. The fact that they came about at all was due to the fact that Victoria is governed by the Australian Labor Party, which is taking a somewhat less harsh course against China. “China is the strongest growth market for Victoria’s exports,” reads a foreign trade website of the Victoria’s government, which has accordingly vigorously opposed the lifting of its agreements with Beijing. Sections of the Australian economy are also doing everything they can to oppose the escalation course of the government in Canberra: The intra-Australian power struggle over China policy may not have been fought out yet.

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