China’s National Development and Reform Commission (NDRC) said Thursday that it has indefinitely suspended all activities under the China-Australia Strategic Economic Dialogue (SED) mechanism co-led by the NDRC and relevant Australian government departments with immediate effect, based on the Australian government’s current attitude toward China-Australia cooperation. Australia’s trade minister expressed disappointment at the CCP’s decision, saying the Australian side remains open to retaining this dialogue and ministerial-level contacts.
Reuters’ analysis suggests that this is a continued setback to the already strained China-Australia relationship.
The Australia-China Strategic Economic Dialogue began seven years ago in June 2014, when then Federal Treasurer Hockey and Trade and Investment Minister Robb held their first dialogue with Xu Shaoshi, then director of China’s National Development and Reform Commission, during a visit to China. This was followed by a visit to Australia by Chinese Communist Party President Xi Jinping in November of the same year, where he and then Australian Prime Minister Tony Abbott jointly announced the substantive conclusion of the China-Australia FTA negotiations, which came into force the following year.
Increasing points of conflict between the two countries
But China and Australia’s flourishing economic, trade and diplomatic relations have plummeted and rippled since the global outbreak of the New Crown (CCP virus) outbreak. Australia was the first country to call for an independent international traceability investigation into the outbreak, with Foreign Minister Marise Payne saying in an interview with the Australian Broadcasting Corporation (ABC) last April that Australia would push for such an investigation. China was the first country affected by the pandemic, and the Chinese side considers the Australian request hostile and politically motivated. Since then, trade sanctions imposed by the Chinese Communist Party on Australia have hit one industry after another, affecting barley, logs, coal, lobster and wine, among others.
The AFP report also argues that, in fact, the Sino-Australian relationship has not hit a freezing point in a day, as tensions between the two countries have continued to grow since 2018 over a growing number of topics, from 5G technology, human rights in Hong Kong’s Xinjiang province, the origin of the coronavirus, to allegations of espionage and more.
Australia Cancels Belt and Road Agreement, Considers Darwin Lease as Triggering Point
Amid tensions with China, Canberra passed new laws last year, including the cancellation of any agreements between the Australian state and representatives of third countries that are deemed to pose a threat to national interests. Under the Australian Constitution, the federal government is responsible for foreign affairs and defense, while the states and territories are responsible for sectors such as health and education. It is widely believed that these agreements are aimed primarily at agreements with China.
But as animosity between Beijing and Canberra grew, the Australian federal government last month tore up the Belt and Road agreement between China and Victoria. Beijing then denounced Canberra’s “unreasonable and provocative measures. And Peter Dutton, who has just become federal defense minister, recently made it clear that he is seriously considering a 99-year lease of the Port of Darwin by Chinese state-owned Lanqiao Group. The port is considered to be of high strategic value and the lease could pose potential risks.
“Economic activity between the two sides will not stop.”
The ABC quoted Monash University economics professor Shi Hailing as saying the latest decision by China’s Development and Reform Commission was in retaliation for the federal government’s two recent measures. He said the statement actually meant a “suspension of dialogue” and did not mean a halt to economic activity between China and Australia, “This suspension mechanism is only a superficial thing, but in fact the relationship between China and Australia has been at its lowest point for a long time,” he said. “The implication is that the dialogue mechanism actually exists in name only.
He believes that China still needs Australia’s iron ore, because China’s economic recovery is still largely dependent on Australia’s iron ore, so economic activities will not stop. Therefore, “the so-called indefinite period is a more flexible statement, from the Chinese government’s point of view, it depends on what the Australian federal government does,” “if the Australian federal government changes its current policy, then this mechanism is immediately resumed. “
Australia is a member of the U.S.-Japan-India-Australia “Quadripartite Dialogue” to counter the Chinese Communist challenge in the Indo-Pacific region with the other four countries, but also with 15 Asia-Pacific countries, including China, which signed a regional comprehensive economic partnership agreement on November 15 last year, hailed as “the world’s largest free trade agreement “The Regional Comprehensive Economic Partnership Agreement, or RCEP, was signed last November 15 with 15 Asia-Pacific countries, including China, to create a free investment environment and address issues such as tariff barriers in the region. When this agreement was signed, it was considered a major economic and trade victory for China in the region at a time of trade wars between the United States and China.
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