Spring thaw in China-Australia relations
Daryl Guppy


Editor's note: Daryl Guppy is an international financial technical analysis expert. He has provided weekly Shanghai Index analyses for Chinese mainland media for more than a decade. Guppy appears regularly on CNBC Asia and is known as "The Chart Man." He is a national board member of the Australia China Business Council. The article reflects the author's views and not necessarily those of CGTN.

"I think it is a long road on which many steps will have to be taken by both parties to a more stable relationship," Australia's Foreign Affairs Minister Penny Wong said after meeting her Chinese counterpart, Wang Yi, on September 22 on the sidelines of the U.N. General Assembly in New York.

In the southern hemisphere the cold winter is giving way to a spring thaw and this also applies to relations between China and Australia.

This meeting follows a similar meeting between the two ministers in Bali at the G20 Foreign Ministers meeting in July. This was the first high level meeting in several years and it was an indication of the strong desire by both participants to move beyond the winter of the China-Australia relationship.

The meeting in New York continues steps towards improvement and sets the stage for more direct and formal senior level meetings to replace the "informal"  meetings on the sidelines of other major conference events. Besides, these meetings also take place against a broader background of improvements.

The first part of this background is the improved courtesy in the discussion. With the election of a new Australian government, Foreign Minister Penny Wong has deliberately embarked on a path that places greater emphasis on diplomacy as a means of improving the relationship. Gone is the "belligerence" of loud-hailer scolding of China that characterized the previous government's approach. Wong has ensured the conversation is more measured, civil and diplomatic.

Australia's Defence Minister Richard Marles said the government was working to stabilize the bilateral relationship with China.

China has responded accordingly. Speaking on September 13 at the Australia China Business Council (ACBC) forum, Chinese Ambassador Xiao Qian said there had been positive steps in resetting the political relationship but warned "at the same time momentum needs to be kept."

Ambassador Xiao emphasised that China wanted to join Australia in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and flagged the possibility of taking the China Australia Free Trade Agreement "to a higher level."

Chinese Ambassador to Australia Xiao Qian addresses the National Press Club of Australia in Canberra, Australia, August 10, 2022. /Xinhua

Chinese Ambassador to Australia Xiao Qian addresses the National Press Club of Australia in Canberra, Australia, August 10, 2022. /Xinhua

Speaking at the same  forum, Australia's Ambassador to China, Graham Fletcher welcomed the  improvement at the political level with the first ministerial contact following Labor's election win along with the "more measured and constructive tone" from Beijing. He was pleased the access Australian diplomats enjoyed to Chinese counterparts had improved since the election of the Albanese government.

Both ambassadors Xiao and Fletcher and foreign ministers Wong and Wang Yi are the right people for these times of reconciliation, so there is great hope in the business community that the path towards improved relations has been opened.

The change in the tone of the discussion between China and Australia is a welcome relief to all. It is this change in tone that has enabled the two meetings between Wong and Wang Yi, which opens the way to further contact between senior leaders.

Australia and China will always continue to have differences but it is the way those differences are handled that is significant. For many years, the negotiation of the China Australia Free Trade Agreement (ChAFTA) stalled because of lingering differences. The then Trade Minister Andrew Robb decided to focus on the areas of agreement, putting the differences aside for future discussion. This quickly and successfully concluded ChAFTA in 2015.

The second part of the broader landscape is the way Australian business has encouraged and patiently waited for this improvement in relations. Ambassador Xiao said the Australian business community had an "important role" to play in putting the China-Australia relationship "back on the right track."

Australia is aiming for a stable relationship with China despite differences in particular on trade, Penny Wong said. "In terms of issues of difference, obviously first amongst them is the issue of trade blockages, and that is the issue I focused on at the outset."

Addressing a pre-forum dinner, Assistant Minister for Foreign Affairs, Tim Watts praised the business community for doing important work to support the relationship, and made clear that business relationships with China were seen as complementary to the government's efforts to stabilize the broader relationship. 

As winter turns to spring in Australia, there is a genuine blossoming of new growth in the China-Australia relationship. Spring will not reveal the same landscape that prevailed before the winter in relations set in because global conditions have changed. China-Australia ties will be different and the meetings between Wong and Wang Yi show the relations will be more respectful and diplomatic.

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