Australia Must Meet the China Challenge

SYDNEY—China is a “boiling cauldron of ideas” careering into the future, with no one, including the Chinese leadership, knowing where it will be in the next 20 years, say some of Australia’s top China experts.

What is obvious, they say, is that China is changing the face of Australia and the Asia-Pacific region, and it is crucial that Australia be informed and abreast of these changes.

Speaking at a forum at Sydney University titled “Meeting the China Challenge”, Dr Richard Rigby, Executive Director of the China Institute at the Australian National University, said China had surpassed everyone’s expectations with its enormous economic growth, but there were serious, mostly domestic, problems ahead. How to address those problems was the subject of much debate, he said.

“Everything is being discussed and thrashed out, and not only by people who might be described as dissidents or non-official China, but within official China, there is an enormous amount of churning of ideas,” he said. “In Australia, we are beholden to try and understand these debates, … because this is going to matter to us.”

Professor Michael Wesley, the executive director of the Lowy Institute for International Policy, said China had already brought a more than 70 per cent change in Australia’s trade since 2002 and an over 13 per cent lift in real GDP.

“In a very real sense, the prosperity we are all enjoying comes from the sheer size of this [Chinese] society,” he said, adding: “Something millennial is going on here.”

Professor Wesley said that Australia’s prosperity from resources sales to China could continue to push the Australian dollar up, beyond the US dollar, putting Australia in an unprecedented position.

“That is profoundly challenging to everything we have been trying to do with our economy in the last 40 years, that is, diversify it past agricultural and resource exports,” he said.

The impact on the Australian economy would be happening at a time when other Asian countries were flourishing, with evident wealth, productivity rises, knowledge and education. This would make it very hard for our manufacturing and service industries to compete.

“The question is, in terms of economic space, where are we going to be in 30 years when suddenly China and India don’t need our resources so much anymore or when the resources run out,” he asked the packed auditorium.

Professor Wesley said China’s rise would force Australia as a nation to think about what values we hold dearly, “what sort of things we are most passionate about in terms of what motivates our society”.

“Arguably, we have never taken our liberal democratic values, our freedoms, as seriously as our prosperity values because they have never been seriously challenged,” he said. “The challenge of China will be whether we continue to prioritise our prosperity values over liberal democratic freedoms.”

This was an issue that would inevitably involve all levels of society, he said, and it was hurtling towards us at a rapid pace.

Dr John Garnaut, Fairfax’s Beijing correspondent, said he was still trying to work out China’s past, let alone its future.

Like his colleagues on the forum panel, he said he doubted anyone really knew what was happening in China, both inside and outside the country, but, from Australia’s perspective, information and analysis of the region were crucial.

“It is very difficult to develop any kind of policies until we can have an informed debate and there are parts of that, but as I have experienced, there is lots more debate than there is informed debate at the moment,” he said.