Even before China’s northern neighbors on the Korean peninsula became caught up in a dangerous game of war mongering, the trade, diplomatic and strategic agenda for Australian Prime Minister Julia Gillard’s visit was bulging.
In keeping with the spirit of the Asian Century white paper, Gillard is heading Australia’s largest official delegation to the country. As one of the first foreign leaders to visit Beijing for talks with President Xi Jinping and Premier Li Keqiang since they took office, Gillard has what she will doubtless regard as a welcome opportunity to escape her domestic political woes and seek to demonstrate her abilities on the international stage.
As a curtain raiser to deepening trade and economic ties, Gillard has made a good start. The proposed currency deal that will make the Australian dollar one of only three currencies able to be converted directly into Chinese yuan — slashing costs for thousands of businesses involved in the $128 billion-a-year bilateral trade relationship — will have a major impact.
But, as our China correspondent Scott Murdoch reports, other issues that go to the heart of the relationship remain, among them questions about Australia’s reliability as a supply partner and mounting concern that, despite 19 rounds of talks, the much-anticipated free trade agreement remains far from finalized. It is not just on these that Gillard is likely to face questions. Beijing remains unhappy about our 2009 Defense white paper, believing it reflects undue suspicions about Chinese intentions. It has been annoyed, too, by Canberra’s involvement in the Obama administration’s “pivot” of U.S. forces to Asia, including basing U.S. marines in Australia.
On this, Gillard must remain unapologetic. On regional security she should turn the focus squarely and expeditiously on to the Korean threat and the need for China, as the sole power with leverage in Pyongyang, to compel its client state to back off.