Old Friend, New Friend

Article excerpt

Australian voters seem to prefer the new leader of the Labor Party, who is well briefed on China, to the present prime minister. But as the country tries to re-define its place in the world - and who its friends are - any electoral outcome is possible.

tHIS YEARS AUSTRALIAN ELECTION IS SHAPING up to be a tough battle. The conservative Liberal Party government of John Howard, first elected in 1996, is doing badly in the opinion polls compared to the Labor Party headed by its new leader Kevin Rudd. On the other hand, Howard is the country's shrewdest politician and should never be written off - and Labor has to gain a large number of seats to win power. It may even end up with a majority of votes but not a majority of seats.

If Labor wins, then Rudd will be the first western leader to be fluent in Chinese language and history. From a very poor family Rudd did well in educational institutions and went into the Department of Foreign Affairs and Trade as a diplomat between 1981 and 1898. He left to work for his Queensland state Labor government, becoming a Labor MP in 1998.

His knowledge of China is appropriate at the beginning of what has been called the Chinese century. Relations with Beijing are one of the factors in the election, but there has been little explicit discussion about this so far. There are three main impacts: on the economy, on race relations, and the largely unarticulated debate over how Australia positions itself in world affairs.


The economy always figures in Australian elections; though the country is still benefiting from its longest ever boom. It began in the tail stages of the last Labor government from 1983 to 1996 which got little political credit at the time for its economic reforms. Becoming the world's sixteenth largest economy, foreign commentators call it the 'wonder down under'.

Australia is among the few countries enjoying a favourable balance of trade with China and its growth is one of the new factors underpinning the economy: Chinas thirst for energy and raw materials has been of great benefit. The largest single energy contract in Australian history has recently been agreed with China, which views it as a stable and reliable supplier.

Meanwhile Chinas exports of manufactured goods have helped reduce the cost of living. Before the economic reforms began a quarter of a century ago, Australia used to have a policy of high tariff protection. Now many inefficient factories have gone because they cannot compete against cheaper imports, especially from China. This has been tough on workers but good news for consumers, who have a greater choice of goods at lower prices. It is also welcome for people with mortgages since the Reserve Bank has kept the bank rate down because the cost of living and inflation have also been low.

Thus we have the irony that the future of the conservative Howard government depends partly on the success of Chinese communism. The government is hoping that the Beijing boom continues, if it runs out of steam, the economy will suffer and so will the government.


China's contribution to Australia's booming economy has also produced a slow change in the level of racism, or at least redirected it against other minorities. Since the European settlement there has been a deep-seated fear of Chinese workers arriving. These fears gathered momentum in 1949 after the Chinese communist revolution. Election posters from the conservative parties in the 1950s and 1960s featured yellow or red arrows pointing from Asia as the communists were allegedly continuing their headlong march across southeast Asia into Australia. China was seen as a country with a huge population looking longingly at our vast empty spaces.

Just over a decade ago, maverick conservative politician Pauline Hanson flashed across the political sky. A Liberal candidate in a solid Labor seat, her racist comments forced the Liberal Party to disown her. …