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Walking a Tightrope
Will Australia's double-dealing tactics in South China Sea work?
By Bai Shi | NO. 18 MAY 5, 2016

A Chinese Navy ship (left) and an Australian Royal Navy vessel sail together during a joint exercise east of Australia on January 1 (XINHUA)

Conference Boosting bilateral relations is the common goal of China and Australia. The two countries have seen multiple successes in recent years, forging closer partnerships in trade, industries, science and technology, in addition to educational and personnel exchanges.

A recent achievement is the China-Australia Free Trade Agreement (FTA) that went into effect last year. Under the FTA, more than 90 percent Australian products pay no tariff when exported to China.

Australian exporters are eager to tap into the second largest economy in the world. China is the largest buyer of Australian goods, ranging from milk powder and wine to wool and iron ore. In turn, Australia has also become a preferred destination for Chinese investors. According to the Australian Bureau of Statistics, trade between the two countries reached $107.21 billion in 2015, and Australia's trade surplus with China reached $14.74 billion.

To further economic ties, Australian Prime Minister Malcolm Turnbull - accompanied by the largest-ever trade lobby of more than 1,000 business delegates - traveled to China on a state visit in mid-April. China for its part held 150 business events in 10 cities to mark the Australia Week in China 2016. During Turnbull's two-day stay, the two sides inked 19 business deals, and the prime minister announced new visa measures to facilitate travel for Chinese tourists and students.

But a discord over the Australian policy on the South China Sea could disrupt ties between the two countries. While both countries have worked to develop closer economic ties, they differ in their outlook on territorial disputes in the South China Sea.

Turnbull said that Australia will not take sides on the issue, which involves China and some Southeast Asian countries.

However, Australia's defense policy suggests the opposite as it is paying close attention to the region's developments. In its 2016 Defense White Paper released in February, Australia devoted dozens of pages to the South China Sea issue and said it is "particularly concerned" by China's land reclamation and construction activities in spite of the fact that some other nations have engaged in such behavior long before China. While the Oceanian nation welcomed China's economic expansion, its Defense Minister Marise Payne cautioned Beijing on China's efforts in "seeking greater influence in the Asia-Pacific region."

The white paper said that "the Australian Government plans to provide $29.9 billion more to Defense over the period to 2025-26 than previously planned, enabling approximately $195 billion of new investment in the defense capabilities in this period."

Chinese foreign and defense ministries have expressed dissatisfaction over the white paper's comments. "It is hoped that the Australian side would take a correct and positive view of China's development and strategic intention, take concrete steps and make joint efforts with China to increase mutual trust and safeguard regional peace, stability and growth," said Hua Chunying, the Chinese Foreign Ministry's spokeswoman.

Australian military planes and vessels have carried out patrols near Chinese islands in the South China Sea. Geographically, those islands are around 2,000 km away from Australia with Indonesian and Malaysian islands in between. About two thirds of all Australian trade passes through the South China Sea freely. All parties involved in the disputes have agreed to try and resolve the issue through discussions rather than militarization.

While Australia has said it will remain neutral on the South China Sea, it has vocally supported its ally, the United States, in their naval exercises in the region. Since declaring a rebalancing policy toward the Asia-Pacific in 2011, the Obama administration has been enhancing its alliances with Japan and Australia to limit China's efforts in safeguarding its territories in the South China Sea.

China previously did not have the military or naval capabilities to defend its islands and reefs in that area, which were then occupied by other countries. Today, it is seeking to strengthen protection of those islands and solve the disputes through negotiations.

The question is: Will Australia play a constructive role in the negotiations or follow the United States in its rebalancing strategy?

Historically, Australia established an alliance with the United States after Japan launched attacks on Australia during World War II. It also worked with the United States during the Cold War. The island nation has supported its ally in the majority of the latter's military endeavors, including the Korea and Viet Nam wars.

But the world has changed since then and China and Australia face unprecedented opportunities to create a better life for their citizens by working toward common goals.

Copyedited by Jordyn Dahl

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