GEOFF MILLER: After the Pandemic; more self-reliance, more costs too.

Apr 13, 2020

Australia will want and need to play a meaningful role in mitigating these consequences. This will be a significant load on top of restoring our own economy, but will be crucial to our place in the Asia-Pacific, and should from the start be an integral part of our recovery planning.

In the current issue of “Foreign Affairs” Richard Haass makes the point that crises can accelerate, rather than change, existing tendencies. This applies to a very current issue for Australia—what will the pandemic, and its eventual end, mean for our international environment and priorities? In September 2018, after the fall of the Turnbull government, and against the background of that government’s Foreign Policy White Paper, I set out in “P&I” a possible set of priorities for the new government. These were:—

“1. Do what we can to keep multilateral and regional cooperation, and the institutions that enable it, going as well as possible. That includes the Paris Agreement, the UN machinery and the WTO. We need to accept that “the US engagement to support a rules-based order”, referred to a number of times in the White Paper, unfortunately no longer applies in the unilateralist Trump White House.

  1. Continue energetically to pursue trade and economic opportunities bilaterally (e.g. bringing the agreement with Indonesia to the point of signature), regionally (TPP11, RCEP) and globally (WTO).
  2. ……The US sees China as a strategic competitor that seeks to supplant it regionally and economically, and perhaps eventually globally. Influential Chinese say that the US seeks to “crush” it. Given these US-China tensions, one thing we should do is increase our efforts to strengthen our other relationships in the Asia-Pacific, including with the ASEAN and Pacific Forum countries, Japan, South Korea and India…..We should do this without needlessly provoking China, or giving it reason to accuse others of seeking to “contain” it.

4, We should seek to manage our important relationship with China, with all its pros and cons, as well as possible.

  1. We should seek to do the same thing with our important relationship with the United States, while also making the point, important in present circumstances, that it should not be taken for granted that we will support or be part of every initiative the US might take.”

These still seem relevant.

In regard to the US-China relationship the progress of the pandemic so far has only made things worse. China is defensive about claims that its lack of transparency in the early stages of the infection made possible its transmission abroad, for example to Iran and Europe. According to an article by Ryan Hass and Kevin Dong that appeared in the AFR of 7 April, “Top US officials believe they have a moral imperative to shine a spotlight on the link between China’s negligent initial response and the global spread of the virus”.

At the same time President Trump has made himself and his country alternately a laughing stock and a source of despair with his record of wrong and wildly vacillating pronouncements about the progress of the virus in the US; the country as a whole has not impressed with its response to the outbreak; and it is clear that significant economic damage has been done, for example in regard to employment.

Many commentators have concluded that China will emerge from the pandemic in better shape than the US in their geo-political competition, given its powers of state control and mobilisation and its predominant economic position in regard to other Asia-Pacific countries, including Australia. This may be so, but a more basic conclusion is that both will emerge with their reputations damaged, and with damage to their economies and capacities as well.

This makes all the more appropriate the 2018 recommendation that we increase our efforts to strengthen our other relationships in the Asia-Pacific, including with the ASEAN and Pacific Forum countries, Japan, South Korea and India. But those countries too are affected by the pandemic, with grave fears held for Indonesia and India, for example. Others may not be directly affected to the same degree, but countries like Bangladesh and Cambodia, whose economies have recently been growing at impressive rates because of their exports of clothing and textiles, have been seriously thrown off course by the indirect consequences of the pandemic, with export markets drying up. Leading Australian and Indonesian economists have stressed (AFR, April 8) that emerging economies are under unprecedented financial pressure, have seen the largest capital outflows in history, and urgently need lines of credit and support to stave off deep, long-lasting crises.

So there will be plenty to do in the region after the worst of the pandemic is over. Of course there will be plenty to do at home too, particularly given that at the best it will take time for our important education and tourism sectors to recover, and indeed they may never return to pre-virus levels.

But if we are serious about being able to have a significant voice in the affairs of our regions—South East Asia as well as the South Pacific—at a time when simply relying on the United States is less credible as a policy than ever, we will have to step up to assist our neighbours in distress. Inevitably prospective expenditure will be challenged and weighed against domestic needs. But we need to play a part in our regions commensurate with our relative prosperity; and it will be much easier to do this if, from the start, the Government makes such a contribution an integral part of our recovery planning.

Geoff Miller is a former Australian government official and diplomat




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