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China’s Belt and Road Finds Its Way Down Under

Australia faces a test on its liberalism.

Photo: Website of China’s Embassy in Australia

Over the years, China has accumulated a reputation for shunning soft power in favour of cold hard money. Its foreign policy, commonly known as chequebook diplomacy, involves flooding compromisable nations with money to pursue particular objectives. As liberalism across the globe wanes, chequebook diplomacy has been delivering more and more for China. Recently, it tempted El Salvador, a small nation in Central America, to switch diplomatic ties from Taiwan to China.

Many stakeholders, however, have expressed concerns over the nature of chequebook diplomacy — including the opaqueness of details. In Australia, Victoria (one of six states) signed a Memorandum of Understanding (MoU) to partake in China’s Belt and Road Initiative (BRI) without consulting Australia’s Commonwealth (Federal) Government. Furthermore, the Commonwealth Government only became aware of the MoU’s signing on October the 25th — the same day it was publicly announced.

Details of the MoU that Victoria signed with China remain private. This is worrying because the Victoria state government completely bypassed its citizens in negotiating with a foreign totalitarian regime. Over a week has passed since the MoU was signed, yet hardly any Victorians have any idea of what the MoU is or what effect it will have on their daily lives.

Supposedly democratic, the Victorian Government’s failure to respect the sovereignty of citizens is disappointing and highlights the moral decay in some western politicians, who now side with money over values. If the Victorian Government continues to undermine the same constituents that give it power, then it may one day find itself undermined too.

It is also important to recognise the broader implications of this MoU. For once the recipient of China’s chequebook diplomacy is neither a minor nor an illiberal nation. It is a superpower in Oceania and a thriving democracy with liberal values as its cornerstone. Australia faces a challenge to balance these liberal values while extracting benefits from cooperating with a country so distinctly different in many political and cultural aspects.

For China, it has long struggled with the brand image of the Belt and Road Initiative — President Xi Jinping’s ambitious, global project that aims to foster trade and connectivity. International publications have continued lambasting it for unfairly exploiting the weaknesses of participants. For example, The New York Times published an extensive piece on how China secured a Sri Lankan port by giving the island nation an unsustainable amount of loans. Signing Victoria, an Australian state, up may improve the perceived quality of BRI.

Looking forward, Australia should be prudent in dealing with China but also optimistic. Unencumbered by the checks of liberal values and norms, China’s ruling Communist Party behaves like any other nation would if given free rein. One check it cannot avoid, however, is public scrutiny. If Australia deals with China transparently, there would be less leeway for China to sneak in terms unfavourable to Australia and more opportunities to leverage China’s expertise in areas such as infrastructure.

Victoria’s endeavour is an early alarm bell that should be heeded.