Australia: The South Pacific Frontline in the Battle against Foreign Interference

Australia: The South Pacific Frontline in the Battle against Foreign Interference, by Tarric Booker.

Americans are most familiar with the foreign interference in the democratic process stemming from the allegations of Russian interference in the U.S. election of 2016. But in Australia, politicians at both a state and a federal level have been forced to resign after being caught in involvement with companies or individuals with ties to the Communist Party of China.

The Chinese influence in Australian politics is already very real, as the country relies heavily on China economically for its continued prosperity.

Australia managed to dodge the “Great Recession” largely as a result of Chinese domestic stimulus measures that boosted the Australian resources and mining sectors.  The Chinese stimulus allowed Australia to not only avoid recession, but enjoy an economic boom while the rest of the world suffered through the global financial crisis.  Since then, sectors of the Australian economy have become more and more dependent on Chinese consumers and capital.

In recent years, Australia has undergone a major apartment-building boom underpinned by Chinese investors purchasing the properties.  The boom has become so large as a result that Australian cities have more large cranes working on construction projects than the United States, despite having less than 8% of the U.S. population.  In addition to that, Australian universities have become increasingly reliant on Chinese students, with 31% of the 525,054 foreign students in the country coming from China. …

China can reward or punish Australia, like it has Japan and South Korea:

In essence, Australia is economically addicted to the capital and revenue Chinese consumers can provide, giving China incredible leverage over a country that has enjoyed economic prosperity without a recession for over 26 years. …

Australia is effectively stuck in the classic carrot-and-stick situation. If Australia continues to sufficiently acquiesce to Chinese demands, then the flow of capital and consumers will continue uninterrupted, driving continued economic prosperity. Should the Australian government rock the boat, there are any number of ways the Chinese government could coerce Canberra back into line.

The Chinese government has already wielded boycotts to great effect in disputes with both Japan and South Korea, creating serious economic consequences for those nations, as Beijing used the spending power of its citizens in an attempt to force concessions.