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Daryl Guppy

Ukrainians have changed the face of modern warfare with inexpensive Chinese drones equipped with cameras. These provide both battlefield intelligence and a platform for delivering destructive weapons.
The paradigm of warfare has shifted, and yet the Colonel Blimps in Australia, as represented by Defence Minister Richard Marles, are still committed to fighting the last war, this time with China identified as the adversary.
Australia’s recently released National Defence Strategy focuses on preparing the military to withstand Chinese coercion. The updated weapons priorities are little more than advanced iterations of the old, designed for denial of battle space.
The idea that China would block its own trade-critical sea lanes is clearly a policy oxymoron embraced by Australia.
Former Home Affairs Department chief Michael Pezzullo said the government should prepare a “war book” because of the “credible” risk of conflict by 2030. In shades of the Blitz, he spoke of the need for plans covering evacuating and sheltering population centres. The concept fails to appreciate the non-lethal nature of modern conflict as it applies, in particular, to Australia.
Let’s for a moment consider this: what would China need to do to bring Australia to its knees in a modern conflict? Australia’s unique vulnerability lies not in its geography, nor its trade routes.


Rather, it lies in Australian economy’s heavy reliance on a few main export earners. It takes no weapons to simply halt Chinese orders for Australia iron ore and coal. Although Australian resources are a major part of China’s import needs, the acceleration of the Simandou iron ore project in Africa and the ramping up of Brazilian production would make it possible for China to suspend orders.
A partial or complete suspension of orders for three or six months would not cause the Chinese economy to collapse, but the Australian economy would hit the hall. There would be no need to disrupt shipping in the South China Sea, as suggested in the defence strategy.
A similar outcome is achieved by prohibiting Chinese tourists from going to Australia, and stopping Chinese students from attending Australian universities. In two simple decisions, two major components of Australia’s earnings would suffer grievous blows.
Is Australia creating US$246 billion out of thin air to buy new Aukus subs?
Not a single submarine needs to be deployed, nor a shot fired. No Australian system needs to be hacked. This is not warfare as the Colonel Blimps know it.
The cumulative damage to the Australian economy would be rapid and devastating. Expensive Aukus submarines, naval assets and rocket artillery do not stand in the way of regulatory obstructions to trade. Billions for submarines would be rendered impotent, even as foreign arms industries are intent on selling hardware to Australia.
If China does not need to physically block trade routes to hurt Australia, then how can Australia prevent such economic damage?


Foreign affairs, which is comparatively poorly funded at present, holds the answer. For a fraction of the cost of the Aukus submarines, Australia’s diplomatic engagement with China could be increased tenfold. For a fraction of the cost, Australia could boost university studies of China and gain a serious depth of understanding of China to replace the simplistic cartoon characterisations that now drive Australia’s public and policy discourse.
The second step is to recognise the legitimacy of China’s desire to play a more active role in formulating the global rules-based order. Like US President Joe Biden, Australia seems to think compliance with American demands is the same as cooperation. President Xi Jinping wants cooperation based on the United States’ acknowledgement of the legitimacy of China’s perspective. Global regulatory structures that do not recognise China are no longer fit for purpose.
As Albanese goes to Beijing, Australia must rethink its allegiances
Currently, Australian foreign policy takes an adversarial approach to China where almost everything China does is wrong or seen as a threat to Australia. This lack of respect is deeply woven into the fabric of current Australian diplomatic and military policy. True to its mission, the military views the world through a gunsight.
Diplomacy can and should take a different perspective. Foreign Minister Penny Wong has smoothed the rhetoric, but Australia’s current position is not substantially distinguishable from the aggressive stance adopted by the previous government.
Marles wants to ensure Australia is able to resist coercion but submarines don’t sit at the negotiating table. Economic warfare by regulation is resolved with diplomacy, not guns.
Daryl Guppy is an international financial technical analysis expert and a former national board member of the Australia China Business Council. The views expressed here are his own


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Australia’s new national defence strategy focuses on countering its ‘adversary’ on the battlefield, yet its true vulnerability lies elsewhere – on its economy’s heavy reliance on China
Diplomatic engagement will protect Australia far better than any military deterrence can


Australia’s new national defence strategy focuses on countering its ‘adversary’ on the battlefield, yet its true vulnerability lies elsewhere – on its economic dependence on China. Diplomatic engagement will protect Australia far better than any military deterrence can.


China-Australia relations

US-China relations

Chinese tourists

Aukus alliance

Diplomacy

Defence

United States

South China Sea

War and conflict

Xi Jinping

Africa

Commodities

Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)
