Australia caught between a rock and hard place

Australian PM welcomed in Washington . . .

Australian Prime Minister Scott Morrison is starting an eight-day visit to the U.S. today, beginning with a day of meetings in Washington and a state dinner at the White House tonight. The two leaders have often praised one another, with Prime Minister Morrison only the second world leader after French President Emmanuel Macron to be hosted at a state dinner since Trump arrived in the Oval Office. While the visit is intended to showcase the strength of the bilateral relationship, some experts see a growing divide between the two countries in their perceptions of China and how to deal with its increasing assertiveness in Asia and beyond.

Playing both sides . . .

Although the two leaders have recently reiterated the strength and resolve of their alliance, Australia still benefits immensely from its trading relationship with China. China now buys almost a third of Australia’s exports and Australia is currently benefiting from the trade war between Beijing and Washington. And while Prime Minister Morrison has sided with President Trump in arguing that global trade rules need to be rewritten as China is no longer a developing economy, Australia is struggling to develop a China policy that both serves its national interests and avoids upsetting either China or the U.S.

What next for Australia?

As uncertainty prevails in the future of the U.S.-China relationship, Australia is unlikely to side fully with one or the other. While we can expect Australia to side with the U.S. on some issues – for example, both leaders are expected to unveil a plan in the next few days to reduce their dependence on China on rare earth minerals – Prime Minister Morrison is also expected to resist U.S. pressure to take a stronger stance on China. What comes next in Australia-U.S.-China relations will be extremely insightful for Ottawa, which is looking for ways to rebalance its relations with Beijing while maintaining its strong alliance with Washington.