Increasing exchanges

At the center of such a deal will be two important issues. The first, set out in the 2013 CCS paper, will be to improve skills and expertise amongst Australians in their knowledge about China. Language skills need to be developed and greater support given to those who want to pursue careers in government, business or academia where China lies at the center—jobs which will almost certainly increase in the years ahead. 120,000 Chinese students now study in Australia. There is likely to be serious consideration given to schemes that place more Australians studying, working and living in China, so that they get firsthand experience to bring back and use in Australia.

The second issue is for the new government to start a public debate, and then make serious decisions, about how to allow more Chinese outward investment into the country. Chinese investment directly into Australia has increased dramatically in the last decade. This is a pattern that has been observed across the globe. But the striking issue is that Chinese investment in Australia in, particularly in, the mining sector, has created good-quality jobs and made a significant impact on growth. There is awareness now that this needs to diversify away from mining and resources, and into areas like agribusiness and services. In both these sectors, there will be discussion and argument, because they present different challenges. For agribusiness, in particular, Australian public opinion is very sensitive. Less than 1 percent of Australian agricultural land is owned by foreigners. Sales of larger amounts immediately start arguments about the country being bought up by non-Australians. There is already awareness though that sale of meat, grain and foodstuffs to China has the potential to replace the shortfall being created by a drop in mineral and energy resources that is now occurring. Abbott's administration is very likely, therefore, to be presented with a strategic choice—see trade fall with the country's largest trading partner, or liberalize investment in a sensitive sector.

On larger geopolitical issues, there is unlikely to be significant change. Julia Gillard and Rudd created a larger role for Australia in international affairs through its gaining a seat on the UN Security Council for two years, and also by increasing the country's involvement in multilateral affairs, from the G20 to ASEAN. Abbott has said that he will focus more on traditional allies like the EU and United States, but this means little more than going for continuity. Despite words from some Australia-based experts like Hugh White, an academic in Canberra, about Australia needing to choose between the United States and China, there is little expectation that this will be something the Abbott administration needs to do. The departing U.S. ambassador to Australia stated on September 10 that it is in Australia's interests to have strong relations with China and the United States, and that the United States and China separately support this. That seems sensible.

There will be questions about the sort of areas where Abbott as a new prime minister will wish to show leadership. His choice of the terrain where he can mark himself out as different from his predecessors is important. Almost all leaders in any country are usually keen to do this. Former Prime Minister Rudd combined a good knowledge of China and ability to speak Mandarin with an inability to bring many of his ideas and initiatives to the implementation stage. This frustrated many inside and outside the country. With Abbott, his opening statement on the night he was elected made it clear he wanted to be lower key, and get on with delivering what he promised. He said that China is the first country he will make an overseas visit to. He inherits a newly created high level dialogue with China, which he can now propose ideas for. It is likely that at the center of this will be issues of how to improve and deepen economic links between the two countries so that they can be positioned as partners for growth. Focusing on a strong partnership in financial services, for instance, between Shanghai and Sydney would be one specific area that would be manageable and realistic. The other would be supporting Australian companies getting the best access to China. Australia had enough of the big-picture approach under Rudd. Now it is down to detail. And it will be on detail that Abbott will be judged in the years ahead.

The author is an op-ed contributor to Beijing Review and executive director of the China Studies Center at the University of Sydney

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