Tag Archive for: Australia-China Relations

The ‘China’ challenge: now a multi-generational test for Australian strategy

In the week of Australia’s 3 May election, ASPI will release Agenda for Change 2025: preparedness and resilience in an uncertain world, a report promoting public debate and understanding on issues of strategic importance to Australia. This is an article from the report.

Navigating increasingly complex and sharp geostrategic competition while advancing Australia’s long-term national interests will be the fundamental test for the next government. China remains a key systemic challenge in this regard—not just for Australia but for the Indo-Pacific and the rules-based order that has served Australia so well since World War II.

Since entering office, the Albanese government has approached its China policy through the prism of stabilisation—along with the formula of cooperating where we can, disagreeing where we must, and engaging in the national interest. That has worked to reset the bilateral relationship, but stabilisation is a transitionary state, not a strategy. Australia’s ‘China challenge’ isn’t cyclical. It’s structural. And, thus, it requires fundamental change for Australia to retain agency and sovereign decision-making.

Indeed, the current relationship is one of increased diplomacy simultaneously with increased malign Chinese activity, and therefore more uneven. Put another way: when one party is seeking stability and another is seeking to destabilise, the destabiliser will always be dominant until facing pushback.

This means, for an incoming government, the key question is: now that Australia–China relations have stabilised in diplomacy but not security, is there a need for a next phase? The answer should be ‘Yes.’

A mercantilist Trumpian world makes this already difficult task harder. The US–Australia relationship remains crucial to security in the region, but Australia must adapt to new realities. The (slim) possibility of a grand bargain between Washington and Beijing also has the potential to sideline Indo-Pacific allies, including Australia. The risk lies in the potential for a US–China agreement that prioritises perceived bilateral interests over the collective security and economic wellbeing of the region.

The unlikely possibility of a grand bargain isn’t the only threat from the US–China relationship. Ad hoc agreements, such as a potential deal over TikTok that doesn’t solve the national-security risk, will also affect Australia, both nationally and regionally. That’s because any sign that the US will take a purely economic approach to China will probably only incentivise more nations to do the same and become even more (over) dependent on the Chinese economy and technology.

To ensure that the US remains invested in the liberal democratic order in the Indo-Pacific, Australia must clearly and consistently demonstrate to the US the tangible benefits of doing so.

Australia has already faced years of coercion from Beijing for choosing national security and international alliances over economic gain but should expect growing pressure to pick sides in ways that will constrain trade and investment choice. The Trump administration’s America First Trade Policy and America First Investment Policy indicate that countries with close trade and investment ties with China could face new obstacles when investing in the US, while countries without those ties may enjoy expedited access.

Amid this ‘harsh’ competition, we’re seeing China accelerating its efforts to pursue military, economic and technological dominance. China’s military aggression has become more pronounced over the past year. In August 2024, a Chinese spy plane breached Japanese airspace for the first time ever. Later in the year, the Chinese Government held its largest military exercises around Taiwan in almost 30 years. Meanwhile, unsafe encounters between Chinese and Australian military aircraft, initiated by the Chinese, have continued to roil relations.

Compounding this is the ‘creeping normalcy’ of China’s use of coercion to bully its near neighbours and to advance unlawful maritime claims, threaten maritime shipping lanes, and destabilise territory along China’s periphery—namely the South China Sea and Taiwan Strait.

More unusually, in February this year, three Chinese warships sailed 150 nautical miles east of Sydney to what Australia’s Director-General of National Intelligence, Andrew Shearer, described as ‘the furthest south a PLAN task group has operated’. Days later, the Chinese vessels undertook live-fire drills in the Tasman Sea in an unprecedented exhibition of non-allied force—before undertaking an almost complete circumnavigation of the continent. Analysts expect such activities to become more frequent as the PLAN expands its power-projection capabilities south—sending a message not just to Australia and New Zealand, but to Pacific partners as well. The message to, and about, the US shouldn’t be ignored: Beijing was telling the US that it can’t prevent China creating a sphere of influence, and telling regional nations that the US had lost power. It didn’t help that a less than ideal response from the Australian Government was reinforced by no comment at all from the US administration.

Meanwhile, the Cook Islands recently signed a pact to deepen ties with China, without consulting with New Zealand (its free association partner). The prospect of a standing Chinese military presence in the southwest Pacific continues to haunt Australian defence planners. Equally concerning for our economic and fiscal planners are persistent risks associated with China’s debt-trap diplomacy, which is creating significant debt burdens, straining the economies of Pacific nations, diverting resources from essential services and requiring Australia to step in.

In emerging technologies—what’s now the ‘centre of gravity’ when it comes to national power—ASPI’s Critical Technology Tracker confirms that China now leads advanced research in 57 of 64 key fields. Those technologies include many with defence applications, such as radar, advanced aircraft engines, drones, swarming and collaborative robots, and satellite positioning and navigation. The number carrying a high risk of monopoly by China has jumped from 14 in 2023 to 24. China is expected to further expand that dominance over the next decade, and we’re already seeing its investment in research resulting in commercial innovation and leadership (for example, DeepSeek).

The Australia–China trade relationship managed to buck some negative trends in 2024. China lifted tariffs on Australian wine and ended import bans on beef and lobster, effectively ending the active Chinese-initiated economic coercion of Australia underway since 2018. The problem is that it’s a mistake to view coercion as existing only once punishment begins—if the threat of punishment results in one not taking action, then that’s still coercion. And it reflects the state of China’s relationship with Australia, and many others. Beijing removed the economic measures only after Australia suspended two WTO cases, which allowed Beijing to save face from what would have been clear international rulings that China had engaged in unfair trade practices against Australia. Notwithstanding the compromises made by Australia, those developments were significant. China is Australia’s number one two-way trading partner; nearly a third of Australia’s exports went to China in 2023.

Although the ending of bans offers the perception of relief, failure to discern between China’s intent and capability—not just in the economic domain, but across the military, diplomatic and technological domains—puts Australia at risk.

China’s actions, not its words—especially in our own region—should drive our choices. From talking points to policy, Australia’s strategic narrative on China has so far been narrowly fixed in terms of Beijing’s apparent intent. The challenge for an incoming government is to shift that focus to China’s capability.

That doesn’t preclude ‘cooperation’ with China where we think we can and should cooperate, but due diligence must be undertaken. Too often, policymakers and politicians use climate change as the easy example of where we should aim to cooperate but fail to acknowledge that China is the largest emitter of carbon dioxide and that, in all likelihood, cooperation with China on issues such as renewable-energy technologies means facilitating China’s systemic use of modern slavery in regions such as Xinjiang. The key is to ensure that our own decisions don’t constrain our future choices as the price Australia pays for stable or cooperative ties with China.

Crucially, Australia shouldn’t limit itself to only being able to ‘disagree where we must’, but rather disagree where we should for national security and sovereignty. That requires a response framework that focuses in equal measure on ‘prevention’ (minimising the conditions from which Chinese coercion can manifest), ‘protection’ (proactive measures to defend against adverse impacts of such coercion), ‘resilience’ (building capabilities to bounce back quicker where coercion is applied) and ‘deterrence’ (imposing costs collectively to deter the continued use of coercion).

Economically, that means we shouldn’t try to replace the decades-long complementarity of the Chinese and Australian economies. Instead, we should focus on:

—building greater diversification and conscious redundancy—with other regional partners and with Europe

—building the dynamism and productivity of our businesses, including through revised industrial policy settings and increasing adoption of technologies such as artificial intelligence (AI).

While China is Australia’s top trade partner on traditional measures, excluding foreign direct investment (FDI), the US is Australia’s other major trade partner, including FDI. So, it can’t be the case that China’s ranking means it dominates our thinking. With Japan, South Korea, India, the US and Taiwan ranked 2 to 6 (and 2 to 6 accounting for more than the 30% that’s China), we’re as economically dependent on the ‘allied’ powers as we are on China.

In scientific developments and critical technologies, most of our strategic partners—the US, Japan, Britain, the EU and South Korea—are larger and have globally competitive tech sectors they’ve spent decades building. In recent years, those areas have included AI, semiconductors, quantum computing and biotechnology.

By contrast, Australia largely remains a mid-sized mining and tourism–dependent economy with a low national spend on R&D (we sit below the OECD average). Building greater sovereign capability in our science and technology sector is needed to improve the shape and size of our economy, as well as its competitiveness. At present, we also poorly understand the industrial dependencies within our economy. That’s resulting in Australian industries becoming uncompetitive and disappearing. For example, the loss of nickel mines has killed fertiliser production. Building real resilience requires us to understand those complex interdependencies, to take more risks in responding (fail fast, but learn faster), and to build new trusted partnerships while strengthening existing ones.

The next Australian Government should therefore consider the following four strategies.

Reframing the ‘China’ challenge as a multigenerational national enterprise

Commence development of an integrated (public and classified) national strategy—embedded as a standing national enterprise. This needs to start from a holistic view of our national interests and our values to determine not just who we must trade with, but how we must trade with them, the undivided purpose being to make us both more prosperous and secure. We have long worked towards a liberal economic order governed by rules—free trade and free markets. The intent of this national enterprise is to not let China trade (or America First trade) water down our national commitment to a liberal economic order.

This national strategy should be enabled by an appropriately tailored whole-of-government coordination mechanism, potentially the reinvention of a dedicated Australian National Security Adviser role with a secretariat, as ASPI has recommended separately. And it should reflect engagement not just across the federal government, but with states and territories and across the economy, as well as think tanks and civil society.

The Prime Minister should give effect to this proposal by making a national address or statement detailing why such a reframing is critical, and then provide an annual account to parliament of progress against the strategy. That statement should speak plainly to the strategic challenges that confront Australia and the Indo-Pacific region and be focused on lifting public awareness and understanding. The purpose will be to alert, not alarm, and to be accountable for progress.

Behind closed doors, an incoming government should elevate systematic planning to identify points of vulnerability or potential leverage. That includes a review of Australia’s supply-chain resilience across sectors relevant to national resilience.

Embedding economic resilience

Complementing the 2024 Independent Intelligence Review’s call for ‘an uplift in intelligence support on economic security’ and a matching review of economic security policymaking architecture, appoint a Minister for Economic Resilience. This could be modelled on Japan’s approach to coordinating and implementing policies to make its economy more robust, more competitive and less vulnerable to external shocks—and which sits as a crucial component of Japan’s overall national-security strategy.

The ministerial portfolio would involve, among other functions, a focus on:

—securing supply chains (particularly for essential goods and technology); that includes diversifying supply sources, promoting domestic production and reducing reliance on potentially vulnerable foreign suppliers

—safeguarding sensitive technologies and intellectual property from foreign interference or leakage; that includes protecting patents and restricting export of strategically important technologies

—driving a coordinated effort to rebuild manufacturing capability and rethink the industrial ecosystem that drives innovation and productivity; that includes building an understanding of industrial dependencies within our economy where investment is necessary for real resilience.

Enabling this would be a redesign of cabinet decision-making processes through the introduction of an advisory framework that better supports cross-cutting decision-making at the intersection of economic prosperity and security, ensuring that the objectives in each domain are rigorously assessed against the impact in the other. That would require a greater focus within the Australian Public Service on developing ‘dual skilled’ personnel who are equally proficient and capable in economics and in national security.

Blocking a ‘G2’ world

Reinvest in collective action to push back on the risk of a ‘G2’ world, in which the fate of Australia and the region is decided exclusively in Beijing and Washington. The current government has pointed to a multipolar diffusion of power in East Asia as an ideal; that is, while there are two great powers, multiple countries retain global influence and impact.

That should indeed become a more explicit strategic objective, but we also need to recognise that a world of multiple influential nations without an architecture for a rules-based order would be just as bad for Australian security and prosperity. Historically, the US and Europe have been the ‘global police forces’ of the rules-based system. We need to adapt our approaches to ensure that they remain ‘fit for purpose’. That requires Australia to commit to even closer relations with Europe, Japan, the ROK, India and the non-aligned world to drive an agenda of purposeful and tangible reform to the rules-based system.

Doing so also requires the development of a ‘strengthened deterrence’ strategy that reflects the reality that the trans-Atlantic and Indo-Pacific no longer exist as distinct geographical locations. The longstanding judgement that authoritarian regimes don’t trust each other enough to work together is no longer accurate. Countering one adversary now requires addressing the influence of the other.

Enhancing competitive edge

Implement a two-pronged approach that attracts our best and brightest in emerging technologies back home from places such as Silicon Valley, while also offering fast-track visas to top US-based scientists and researchers who are newly out of a job or low on the funding they need to keep their start-up or scientific lab running. All would provide shared benefit to our alliance with the US and close partnerships.

Complementing that would be the implementation of a comprehensive strategy to create an Australian AI ecosystem that drives innovation and enhances economic competitiveness—ensuring Australia’s place higher in the value chain. The UK Government is pursuing such a strategy. That includes driving AI adoption through investments in infrastructure, talent and R&D, while also establishing a flexible regulatory environment and actively encouraging both domestic and international investment in the sector. There’s a focus on sector-specific regulatory approaches, empowering existing regulators and promoting the UK as a global hub for AI innovation and safety. That’s a valuable approach for Australia to consider.

It’s time to imagine how China would act as regional hegemon

Regional hegemons come in different shapes and sizes. Australia needs to think about what kind of hegemon China would be, and become, should it succeed in displacing the United States in Asia.

It’s time to think about this awful prospect because under President Donald Trump the US’s commitment to alliances is suddenly looking shaky. And there’s also the risk that even a fully committed US could try and fail to restrain China militarily—for example, in the crucial scenario of defending Taiwan.

Regardless of whether overt military force had been needed to supplant the US in Asia, leaders of a newly hegemonic China would likely initially try to portray the country as a much less aggressive and far more tolerable alternative keeper of the regional peace than the sceptics had thought.

With the region cowered and everyone else anxiously looking on, it would make great sense for a triumphant and unchallenged China to project a strong but benign image of itself to the world. Such a phase could last years and even decades, but it would not last forever.

Ideally, China’s leaders want China to be a regional hegemon that has tremendous military capabilities that it rarely, if ever, needs to use to get what it wants, principally because it is unmatched.

The prospect of the use of overwhelming military force combined with the usual economic carrots and means of political and social control across the region would, they’d hope, ensure that a hegemonic China’s interests automatically featured in the decision making of all regional countries.

That would be plan A.

China’s problem and ours is that most regional countries and the people that live in them would eventually tire of that dynamic and start pushing back.

That is problematic mainly because deference lies at the heart of Beijing’s conceptions of the virtues of a historically China-led regional order, making anything short of absolute submission difficult to tolerate.

China’s leaders are not looking to break new ground by seeking regional hegemony. Rather, they are trying to return China to a position of dominance that enables it to control what those in its orbit think, say and do.

Many of China’s coercive and technological means and methods to secure that high degree of external influence and control are new. Its desire to have them is not.

Working from the assumption that China won’t compromise on the deference front, Canberra and other regional capitals need to think about how much direction from Beijing they could stomach and how push-back might manifest itself.

This is where it starts to get messy.

The less China is challenged by a regional peer competitor, the more unacceptable even the smallest external acts of defiance will seem to a domestic Chinese audience. This means that for reasons of domestic political legitimacy alone, leaders of a hegemonic China will want to deal with any afront in a way that is seen to effectively deter others.

With internal pressure to act like a proper hegemon and no credible external checks and balances on its behaviour, it is not hard to imagine China’s leaders pursuing increasingly overt and punitive methods to compel obedience and engineer thought beyond its borders.

It is also not difficult to imagine that effort backfiring on Beijing sooner than it expected, leaving it with no apparent choice other than to use military force to achieve outcomes.

A hegemonic China would eventually overstep, eliciting a collective regional reaction that from Beijing’s perspective will need to be quashed. This would provide a pretext for China to become the expansionist and authoritarian power that it would say it never intended to become but now must to preserve regional stability.

Thinking about how far the leaders of a hegemonic China would want to go to avoid reaching that conclusion, and exactly what they would do when they reach it is anxiety inducing and unpleasant.  But it’s a task policy planners need to take on instead of wilfully avoid.

China is clearly committed to its objective of kicking the US out of Asia and assuming what it feels is China’s rightful place in the region. But it is important to remember that China’s leaders too would be unsure and anxious about how an outcome in China’s favour would play out.

For us, facing the challenges posed by the potential emergence of a hegemonic China means thinking ahead and imagining ways to move forward in different circumstances without getting stuck.

Luck will play a role.

Pressure Points: The importance of Australia’s military presence in East and Southeast Asia

This week ASPI launched Pressure Points, an interactive website that analyses the Chinese military’s use of air and maritime coercion to enforce Beijing’s excessive territorial claims and advance its security interests in the Indo-Pacific.

The project highlights and analyses open-source data, military imagery, satellite footage, official government responses and other resources to provide the public with a reliable and accurate account of Chinese regional activity, from its intercept tactics to its excessive claims. It analyses China’s unsafe military interactions with a range of countries, and looks at the way countries use (or don’t use) their military forces to challenge China’s excessive claims in the South China Sea.

A powerful Chinese task group recently circumnavigated Australia, energising debate among Australian commentators and politicians. Canberra was provided a close-up view of Beijing’s rapidly expanding military capability and intent to deploy forces that could—under different circumstances—threaten our cities, population and vital supply routes.

Coupled with growing anxiety around the US alliance and the state of our own aging fleet, the circumnavigation led some to question the activities of Australia’s military, including our commitments within the Indo-Pacific region. Why is Australia deploying military forces to China’s backyard? Aren’t our forces better used closer to home? Why are we provoking our largest trading partner?

These anxieties discount three important facts:

First, Australia’s economic and security interests are intertwined with the Indo-Pacific region. The Indo-Pacific has prospered for decades on the back of international law and rules and norms that have helped to shape the behaviour of states, both large and small. As outlined on Pressure Points, China is increasingly using its military and tactics below the threshold of war to challenge these rules and norms, coerce and deter other countries, and advance its strategic interests.

Regional deployment of Australia’s military helps push back on China’s unwanted advances and protect existing rules and norms, especially when our military conducts activities that challenge China’s excessive territorial claims (such as transits through the Spratly or Paracel Islands). International law is only likely to hold if countries such as Australia are willing to physically enforce it. But, as we have seen on five separate occasions since early 2022, these activities are not without risk. We should expect China to continue to use aggressive and unsafe behaviour to deter our military presence.

But the risk is worth it. Australia cannot afford the continued expansion of China’s excessive claims and the development of a Sinocentric order, which prioritises laws that favour Beijing’s interests, rather than an agreed set of international rules and norms. A continued military presence that supports international law and Australia’s partnerships is firmly in our interest.

Second, we should take stock that it is Beijing’s behaviour that is changing, not our own. Australia’s military has a long history in the Indo-Pacific region. Our warships have been sailing through the South China Sea since World War II. Our defence force has worked with partners across East and Southeast Asia (including China) for decades to increase common understanding and build military interoperability. Our military presence has been longstanding and consistent, and it is founded on longstanding regional partnerships with countries that want Australia to remain militarily engaged in the region.

In comparison, since late 2021 China has used unsafe military manoeuvres to coerce and deter the armed forces of the United States, Australia, Canada, the Philippines and the Netherlands. The actions of China’s Coast Guard and maritime militia have mirrored this increase in aggressive military behaviour, but they rarely project beyond the first island chain.

We are not provoking China—China is provoking us. Beijing seeks to disrupt and deter our longstanding military presence, as well as the presence of other militaries. Thankfully, the tide isn’t necessarily flowing in China’s favour. We have seen more countries deploy military forces to East and Southeast Asia in 2024 than in the previous decade. This presence acts as a bulwark against China’s aggressive behaviour.

Third, China has shown its ability to project military force into our region. We can expect this to continue. The circumnavigation was not a quid pro quo—Beijing was not trying to say ‘if you stay out of our backyard, we’ll stay out of yours’. China’s development of a blue-water navy capable of undertaking extended deployments in our region is part of a broader strategy of national rejuvenation, in which China becomes the pre-eminent global military and economic power.

The pursuit of this strategy will increasingly challenge Australia’s interests. But if we are going to challenge military actions from China, this is best done transparently with partners in the South China Sea, rather than on our own doorstep. China has demonstrated its ability to employ multifaced and flexible tactics to achieve incremental advances over time.

It is necessary to challenge China’s excessive claims in the region, while also responding to its increased military presence in our immediate vicinity. But to do both, Australia must dramatically boost the currently depleted capacity of the Australian Defence Force.

Economic security and geostrategic competition: fostering resilience and innovation

Australia and other democracies have once again turned to China to solve their economic problems, while the reliability of the United States as an alliance partner is, erroneously, being called into question.

We risk forgetting lessons of the past when we cling to the long-gone notion of the free market, which Beijing sees as democracies opening themselves to China’s unfair business practices. Economics and security are closely linked: we must build resilience and foster innovation to prevent economic dependencies that weaken our security.

We should be concerned when countries impose tariffs on friendly countries, as the US is doing. It erodes trust, weakens solidarity among like-minded democracies and dangerously risks a tit-for-tat approach of revenge tariffs that will leave us all poorer. This drives inflation while passing costs onto consumers.

But while we need to keep working for a different outcome—as the Australian government is doing—we mustn’t focus on spot fires when the forest is ablaze.

Almost a decade ago, Australia led the world by abandoning an outdated foreign policy of balancing economics and security. We recognised that trade interdependencies didn’t deter conflict and that short-term financial interests should never outweigh security concerns. Balance sounded good in theory but in practice meant trade-offs that left us unsafe.

It was China’s actions that forced the change: having become our largest trading partner, Beijing used our economic reliance as leverage to implement a systemic program of security breaches and threats against us, from cyber intrusions to foreign interference.

Unfortunately, recent trends reveal that security trade-offs weren’t abandoned so much as temporarily paused. Many democracies are responding to immediate cost of living pressures and hoping security threats can be kicked down the road. This is a policy of security crisis delay, not deterrence.

Economic prosperity is needed to pay for security, and security without prosperity leaves us vulnerable to decay. But as is the case for individuals and households alike, assurance comes at a cost. So, the key question that confronts is what is the short-term price—an insurance premium of sorts—that we are willing to pay for long-term confidence of our prosperity and security?

Western countries need to look beyond resilience and risk reduction to embrace a more comprehensive strategy—one equally focused on (shared) innovation and competitiveness, especially in those emerging technologies that will determine future prosperity and security.

Brad Glosserman correctly argues that, in response, the US and its allies have been ‘doing economic security wrong’ by focusing almost exclusively on resilience and risk reduction. This has meant overlooking deterrence, and not prioritising future competitiveness. Partners and allies must define key industries and sectors, and stop choosing cheapest associated supply chain.

They must strengthen resilience by establishing frameworks to protect critical and emerging technologies from intellectual property theft and economic coercion by China. And, as Raquel Garbers argues, enhanced deterrence requires education on what economic warfare is and how it works, and with tools that disincentivise economic activities with hostile states.

Glosserman correctly emphasises the importance of supporting innovation and ‘unlocking innovative potential’. Resilience requires us to move beyond traditional notions of just protecting the economy to an approach that prioritises innovation and technological leadership.

To establish an effective strategy, we must understand what specific policies governments can implement to foster a innovation in critical and emerging technologies. This also requires increased collaboration between the US and its allies, particularly in areas where China has a strong lead.

We need to leverage the strengths of countries such as India, which ASPI’s Critical Technology Tracker has identified as an emerging centre of research excellence, to diversify research partnerships and build a more resilient global innovation network. We must also be wary of the short-term focus of shareholder capitalism and its negative impact on long-term economic security.

We should consider how can we rebalance the capitalist model to prioritise, incentivise and reward long-term investments in innovation and resilience. The prosperity and economic growth needed to best provide national security won’t result from protectionism, but from a long-term strategic approach to emerging technologies.

Doing so, however, will still require us to remember you get what you pay for. Any savings we gain from prioritising cheap supply chains in the present will ultimately be outweighed by higher security costs in the future.

We need to remember that short-term disagreements with friends will pass as they have before. National interests may on occasion come into sharp contest, but strategic alignment will persist. It is systemic and malign challenges that require our collective focus and investment.

Societal resilience is the best answer to Chinese warships

The Australian government has prioritised enhancing Australia’s national resilience for many years now, whether against natural disasters, economic coercion or hostile armed forces. However, the public and media response to the presence of Chinese naval vessels in the Tasman Sea over the past two weeks suggests that more work must be done to strengthen the resilience of Australian society.

Political leaders and senior officials have repeatedly stressed that ‘Australia faces the most complex and challenging strategic environment since the Second World War’, but recent commentary suggests that Australia as a society isn’t yet mentally adjusted to such circumstances.

While the public should be aware of China’s military signalling, and attempts to antagonise or even intimidate, we shouldn’t overreact.

Yes, these activities are unexpected. Yes, certain elements have been conducted unsafely and unprofessionally, notably the live fire drills which were carried out with extremely short notice and disrupted nearby civilian air traffic. Nevertheless, such activities are legal, relatively commonplace and likely to occur more frequently as China develops a more capable, expeditionary navy.

Taking the bait and choosing to be provoked only serves to justify Beijing’s common overreactions when non-Chinese ships operate legally in waters close to China.

Moreover, if Australian society—or, specifically, the voting public—regards activities such as sailing Chinese ships in our exclusive economic zone to be a threat, then the scope of government reaction is restricted: ministers may be under pressure to be more strident than they should be and react in ways that are not conducive to our long-term interests.

None of this excuses China’s blatantly aggressive acts, for example repeated hostile aircraft interceptions, endangering Australian aircraft and crews by releasing chaff or flares in front of them or using sonar against Navy divers. These are, and should be, condemned.

Denying China the headlines and propaganda victory it craves would clearly show how extreme Chinese measures have been.

Drawing on the Cold War experience, NATO naval vessels routinely shadowed Soviet warships in the North Atlantic, Mediterranean and Indian Oceans to monitor their behaviour and obtain intelligence. Similarly, we should expect Chinese intelligence-gathering vessels to lurk nearby large-scale training exercises such as Talisman Sabre, as they did in 2023.

In today’s context of widespread strategic competition, we should expect these kinds of activities to be just as commonplace and therefore try to inform and educate the public accordingly.

The threat posed by China is not going away. Nor are its naval and coast guard vessels, whose numbers are rapidly rising, and its global ambitions are growing.

While the political drama that these events may provide is undoubtedly tempting in the lead-up to the federal election due by May (a coincidence, or an attempt to sow discord?) it is shortsighted to seek partisan advantage from a scenario that will be repeated frequently for maybe decades to come. That merely encourages similar behaviour from the other side of politics when governments change.

The priority should instead be on building a more resilient society that is better equipped to respond to complex—and confronting—situations. Part of that is ensuring our society is better informed and less susceptible to propaganda, misinformation and disinformation, none of which is served by overreacting to routine, if unprofessional, naval activities.

Beyond rhetoric, an important dimension of building resilience is ensuring that the Australian Defence Force is suitably equipped to respond to such scenarios. It would give the public confidence that their armed forces are capable of monitoring and responding as required.

As other contributors have noted, the Australian navy’s capability shortfall must be addressed. China has proven adept at using maritime means to intimidate, destabilise and coerce its neighbours in Southeast Asia. We must be mindful, and prepared, in case these techniques are applied in our immediate region.

Should China establish a base nearby or pursue more regular deployments to Australia and the Pacific, ADF resources would rapidly become strained if the level of response expected to every Chinese navy transit matched the tone set by the current reporting.

Resilient societies and polities are those that know when to respond forcefully, and when to keep their powder dry. For the sake of navigating the long-term challenge of a regional environment defined by strategic competition, Australia needs to learn and apply this lesson quickly.

Chinese navy transit: opinions in The Strategist

Views in The Strategist on the recent Chinese warship deployment near Australia range from ‘get used to it’, to a warning against overreaction and a welcoming of the resulting debate over defence. Here are introductions and links to the articles:

China will continue to conduct unsafe military manoeuvres and we can expect to see more advanced warships in our region, writes Joe Keary.

While the frequency and duration of deployments have been limited by a lack of support ships and overseas support bases, Chinese military developments show its goal of a navy capable of projecting power into our region and beyond.

As China’s navy improves its logistics and defensive capabilities, a lack of overseas bases will only slow, not stop, China’s ambition to project naval forces into global environs (including Australia’s) more often and for longer durations.

China’s demonstration of its advanced naval capabilities highlights Australia’s shortcomings, writes Jennifer Parker.

While China’s fleet has grown in number and capability, Australia’s fleet has aged and shrunk. This leaves Australia unprepared to protect its maritime security interests.

China’s naval demonstration on Australia’s east coast should serve a reminder of our vulnerability, and a warning that addressing this vulnerability requires Australia to truly recognise its place as a maritime power.

The deployment to nearby international waters raises the question of what Australia could do if China sortied into its waters, writes Ian Langford.

In the short-term, it should step up equipping the Australian Army for maritime defence.

Despite the fleet of ships remaining in international waters and the comments from many that this activity raises no concerns for our future defence capability plans, it nonetheless does reflect on our current military capacity and highlights the urgent need for ongoing improvements in force projection, sea control and, where necessary, maritime strike.

An Australian overreaction to China’s deployment jeopardises our own necessary activities in the South China Sea and North-East Asia, writes Jennifer Parker in another article.

Australia’s best response would be to expand our own maritime capabilities to effectively exercise our own rights and protect our interests.

The freedom of the seas is fundamental to our security as a maritime trading nation. Claims that China’s warships shouldn’t be operating in our exclusive economic zone or conducting live-fire exercises on the high seas undermines this principle, giving China a propaganda win to challenge our necessary deployments to North-East Asia and the South China Sea—routes that carry two-thirds of our maritime trade.

But the Chinese navy’s activation of political debate over defence policy is welcome, writes Euan Graham.

Noting legal reciprocity of freedom of navigation, countries have a duty to act professionally. The lack of advance warning and the flotilla’s transit were a message to which the Australian government should respond.

…ordinary Australians are quite entitled to read hostility in China’s intentions. The flotilla was not invited here, and China didn’t notify us it was coming. Carrying out live fire exercises in the Tasman Sea with little or no notice, as the flotilla did on 21 February, wasn’t just unprofessional; it sent an unmistakably coercive signal to Australia and New Zealand.

China has long used naval transits to send a message, but the pace has increased in recent years, writes Joe Keary.

They are known to monitor exercises, float around defence facilities and appear around election time. The expansion of activities reflects China’s ambition to grow the strength and capability of its navy and to project power into our region.

Together, these deployments paint a picture of a country that is undertaking sweeping efforts to transform its navy into a formidable blue water force, capable of regularly projecting hard and soft power to our region.

China’s navy sends a steady drumbeat of ships around Australia

China’s deployment of a potent surface action group around Australia over the past two weeks is unprecedented but not unique. Over the past few years, China’s navy has deployed a range of vessels in Australia’s vicinity, including state-of-the-art warships, replenishment ships, intelligence-gathering ships, survey ships, satellite support ships and hospital ships.

Together, these deployments paint a picture of a country that is undertaking sweeping efforts to transform its navy into a formidable blue water force, capable of regularly projecting hard and soft power to our region.

China’s navy, now the largest in the world by number of vessels, has a vast range of ships that can undertake a broad scope of tasks and we have seen nearly all varieties of ship in our region in the past five years.

In October, China put on a show of force in the South Pacific by sending two warships to Port Vila in Vanuatu. One was a Type 055 cruiser, marking the first known deployment of this advanced warship class to the South Pacific. The deployment was intended to send a clear signal of China’s ability to project power beyond its traditional areas of influence.

Unlike the current action group circumnavigating Australia, Chinese warships are not typically accompanied by replenishment ships (the exception being a 2019 deployment that appeared in Sydney Harbour after conducting operations in the Gulf of Aden). The addition of replenishment ships to Chinese action groups enables greater force projection into the Pacific.

Chinese Type 815 intelligence ships are regular visitors to our region. Since 2017, China has been sending at least one such ship to Australia’s north to electronically eavesdrop on our biennial Talisman Sabre military exercise with the United States and other partners.  At the most recent Senate estimates hearing, Chief of Defence Force Admiral David Johnston noted that an intelligence ship had travelled as far as Sydney after the 2023 Talisman Sabre exercise.

China is also developing a habit of sending naval ships to our region during election periods. While many commentators have understood the significance of the timing of the current deployment around Australia, it has yet to be noted that China’s navy was also present in the weeks before the 2022 federal election. In May that year, China sent an intelligence ship to Australia’s north-west, including near the Harold E Holt Communication Station, a sensitive defence facility near Exmouth, Western Australia. At the time, that was already significant. Now China has upped the ante in 2025.

China’s navy sends a range of vessels to the Pacific for port calls and good-will visits. Last year China sent an air-defence destroyer to Tonga, joining 11 other navies in celebrating the 50th anniversary of the Tonga Royal Navy. We now see regular Chinese navy visits to the Pacific, especially to the Pacific island countries that have militaries: Papua New Guinea, Fiji and Tonga.

China also pursues soft power in the Pacific through the deployment of the Peace Ark. The Peace Ark is one of two hospital ships that China’s navy uses to provide health services as part its soft-power diplomacy in the region. In 2023, the Peace Ark paid friendly visits to Kiribati, Tonga, Vanuatu, Solomon Islands and East Timor. It stayed for around a week in each port, offering free medical services to local populations.

China’s navy also has a range of ships that are used for tracking satellites and intercontinental ballistic missiles—large ships with impressive arrays of dishes and scanners. Tracking ships of the Yuan Wang class regularly operate in the southern Pacific Ocean and the Indian Ocean west of Australia. Since China lacks ground stations elsewhere, these ships give it the ability to track launches and satellites that are not over its territory. (China operated a ground station in Kiribati for six years, but it closed in 2003.)

Finally, China has developed the world’s largest fleet of civilian research vessels. While many undertake missions for peaceful purposes, they also provide China’s military with important data about the world’s oceans. The Hidden Reach project of the Center for Strategic and International Studies does an amazing job of tracking these vessels and their ties to China’s military.

We are seeing more of these vessels in our vicinity, including off the north-west shelf of Australia. In early 2020, officials tracked the movements of a Chinese research vessel as it conducted deepwater surveys near Christmas Island. A Defence official said the ship was mapping waters used by Australian submarines to get to the South China Sea. It also spent much time in waters not far from the Harold E Holt Communication Station.

Like the current deployment, China’s naval activities in our region are consistent with international law. Operating a range of ships is also not unique to China. Most large countries, such as the US, Russia and France, maintain a variety of warships, space support vessels and research vessels that support military activities. However, the increasing number and variety of ships in our region sends a strong signal of China’s ability and intent to project hard and soft power.

This is our new reality. Monitoring and managing China’s growing naval presence in our region will place increasing strain on our military for years to come.

When dealing with China, Australia must prioritise security over economics

China’s economic importance cannot be allowed to supersede all other Australian interests.

For the past couple of decades, trade has dominated Australia’s relations with China. This cannot continue. Australia needs to prioritise its security interests when dealing with Beijing, and it shouldn’t overestimate or overstate its vulnerability to China’s coercive trade practices.

Prioritising security is particularly important as we confront escalating global competition and China’s increasingly assertive behaviour. China’s live-fire exercises in the Tasman Sea have once again brought attention to the growing threat of aggressive Chinese military actions in the Indo-Pacific.

The exercises were conducted in international waters and violated no international law. But the behaviour broke norms and was less than ideal: usually, such exercises are preceded by adequate early warning to affected countries. In this case, neither Australia nor New Zealand was informed, and early reports suggest that passenger aircraft that were already enroute were forced to reroute because of the exercises. This is unacceptable international behaviour, and the Australian government should not be shy in saying so.

Australia has been more than accommodating of China. In response to press questions on live-fire exercises, Prime Minister Anthony Albanese said China ‘could have given notice but Australia has a presence from time to time in the South China Sea’. This framing was unwise, to say the least. Albanese no doubt wishes to avoid escalation, but it is unnecessary to provide such false equivalence, which Beijing could exploit. The comment offers China a free pass.

Economic issues are important for political leaders, especially in democracies, where everyday issues take precedence even over discussions about national security. This is probably why Albanese highlighted the government’s success in boosting trade and addressing disputes with Beijing—even though many of these disputes were of China’s doing, rather than Australia’s.

But Australian leaders should also recognise that China is not simply doing us a favour by trading with us. It benefits from the goods and services that Australia offers and the revenue from what it sells. This is a mutually beneficial relationship, and disruptions will affect China too.

While China may be able to source its mineral and other resources from other parts of the world, Australia can similarly find other markets for its resources, as it has in response to previous Chinese trade obstruction. China buys from Australia for a variety of reasons, including price, quality and the predictability of supply. These are not values it can get from anywhere. In many countries, resources are in conflict zones that are difficult to access.

Any trade disruption would likely hurt Australia more than it would hurt China, but it would still damage China’s economy. There is a reason why previous trade punishments have targeted a few niche products, such as wine. China has not targeted critical items, such as mineral resources, precisely because it knows that its own economy would face difficulties if it did so. As China’s economy slows, the cost of transitioning away from Australian goods and services rises.

China has repeatedly used trade sanctions against smaller economies—such as Norway, Canada, Sweden and Mongolia—for perceived slights and other political reasons. But it has never really benefited from doing so, instead gaining a reputation as a bad and unreliable actor. Its trade threats in the past few years have been more bark than bite, with most targeted countries, including Australia, standing their ground and China eventually backing off.

While Australia should not pursue trade confrontation, it may be similarly unwise to emphasise or exaggerate its vulnerability, as this will only invite pressure. Rather, Australia should initiate talks with its European and Indo-Pacific partners, as well as the US, to present a united front against such threats.

China can make threats and apply sanctions only against countries with smaller economies, and only because it thinks they will have to face such sanctions alone. Even if sanctions are ineffective—as indeed they have been—we cannot let China assume that it can get away with such behaviour without consequences. A united response to China’s trade bullying is needed to deter and, if deterrence fails, punish China for such aggressive actions.

Political leaders in democracies no doubt have a hard time balancing economic and security requirements in foreign policy. But they should avoid over-emphasising trade and economic factors—Beijing will assume these are pressure points when leaders talk as if they are. Australia must instead emphasise that it will not bend to such tactics.

China’s naval deployment should invigorate Australia’s election debate

The Australian government’s underreaction to China’s ongoing naval circumnavigation of Australia is a bigger problem than any perceived overreaction in public commentary. Some politicisation of the issue before a general election is natural in a democracy—and welcome if it means Canberra’s defence and China policy settings feature more prominently in debates ahead of the election due by May.

How times have changed. Fifteen years ago, Australia was worried that the quadrilateral partnership with India, Japan and the US would spook China, making it worry that it was being strategically encircled by the US and its regional allies and partners. Wind the clock forward to 2025 and China’s navy is off Perth, circumnavigating Australia with a potent surface action group.

This is the furthest south that a Chinese naval flotilla has ventured. This one is composed of a cruiser, a frigate and a replenishment ship—above the surface, at least.

Naval analysts have urged Australia to temper its reaction to the deployment because Canberra has a reciprocal interest in freedom of navigation in China’s maritime periphery. This is certainly a factor, and to some extent puts the government in a bind. The Chinese navy has a clear legal right to operate in waters close to Australia, even if it is going very far out of its way to make a point. That includes the right to conduct live-fire exercises.

But what point is Beijing making? Even while noting legal reciprocity in freedom of navigation, ordinary Australians are quite entitled to read hostility in China’s intentions. The flotilla was not invited here, and China didn’t notify us it was coming. Carrying out live fire exercises in the Tasman Sea with little or no notice, as the flotilla did on 21 February, wasn’t just unprofessional; it sent an unmistakably coercive signal to Australia and New Zealand.

By sending its navy all the way around Australia, the Chinese Communist Party is signalling that all of Australia lies within reach and is part of its area of direct military interest. It is showing it can project combat power and potentially hold Australia’s maritime communications at risk even though it lacks a base close to the continent. (And we should not think that Beijing has given up on getting one.)

The initial response from Australia’s government was muted and, on the issue of whether China had given warning of its live fire drills, muddled. This, and Prime Minister Anthony Albanese’s evident desire to downplay the significance of the deployment will have been noted by Beijing, which with the deployment is testing and comparing reactions in Canberra, Wellington and Washington.

The United States, under new political management, has so far stayed silent on the deployment, despite the concurrent presence in Australia of the chief of its Indo-Pacific Command and a US nuclear submarine at HMAS Stirling, near Perth. There is still time for the US to show its support this week, before the task group completes its tour of Australia and returns to the South China Sea through the Indonesian archipelago, as it can be expected to do.

New Zealand’s initial response was conspicuously better than Australia’s. Defence Minister Judith Collins linked China’s motivations to its strategic quest for greater influence and access to marine resources in the South Pacific, uncomfortably underscored by a recent deal between Beijing and the Cook Islands that blindsided Wellington.

A firmer Australian government reaction could have set the tone for a less divisive political debate. Canberra’s contention that it has stabilised bilateral relations with China looks increasingly questionable in light of the unsubtle ‘or else’ message trailing in the Chinese navy’s wake as it sails around Australia. China’s coercion of Canberra since 2020 has never stopped; it has simply taken different forms.

Australians and New Zealanders should not fall into the trap of viewing China’s naval deployment to their neighbourhood in isolation and adopting a defensive mindset. In fact, the Chinese military is mounting concurrent drills at several locations, including near Japan, Taiwan and the Gulf of Tonkin, close to Vietnam. Beijing is ramping up its military presence across the Western Pacific to calibrate regional reactions, most likely with an interest in probing the strength of US alliances and security partnerships early on in the second Trump administration.

The more Australia and other countries speak with one voice on China, the harder it will be for Beijing to exploit potential wedges.

This will not be the last time a Chinese surface action group undertakes a three-ocean deployment around Australia. But the current deployment may turn political debate to defence spending increases, the hollowed-out state of the Royal Australian Navy’s surface capabilities and the government’s supposed stabilisation policy settings. If it does, we may owe a debt of gratitude to the Chinese navy.

For a faster solution to nearby maritime threats, look to the Australian Army

China’s not-so-subtle attempt at gunboat diplomacy over the past two weeks has encountered various levels of indignation in Australia and throughout the region. Many have pointed out that the passage of a three-ship naval task group about 500 kilometres off Australia’s east coast took place in international waters, a comment echoed in China, where officials have accused Australian politicians of ‘deliberately hyping’ the issue.

Many commentators have seized this opportunity to highlight the failure of Australia’s naval shipbuilding program over generations to meet the necessary ship production numbers for national security. They also point out that the current surface-ship building program will not take effect until the 2030s.

This misses a deeper point, however: what if the Chinese navy did sortie into our waters, or worse still, decided to interfere with our air and maritime movements by declaring, for instance, an air defence identification zone, similar to what occurs in the waters off Taiwan every time the Taiwanese disturb the Chinese Communist Party? Could we take any action?

The answer to this question goes to the core of Australian defence policy in 2025.

Military strategy is often described as ‘ends, ways, and means’, which serves as a useful model for understanding the application of strategy. In this context, the ends represent the ambitions of the 2024 National Defence Strategy, which aims to deter any hostile acts against Australian territory, its people and international interests. Deterrence is achieved through effective diplomacy, a strong economy and, in this case, military hard power.

With deterrence established in policy as an end, the ways logically follow. Referring to our observations from the past two weeks, ways would manifest as an operational concept or plan to deny the Chinese open access to our home waters. This might involve an Australian-flagged maritime task group that could be rapidly deployed and capable of shadowing and deterring the Chinese. Typically, this task group would consist of frigates, submarines and supply ships. Other methods would include air power, such as maritime surveillance and strike aircraft from the Royal Australian Air Force.

With ends and ways established, the final element of applying military strategy is the means, which essentially represent the forces and platforms necessary to carry out military operations. Here, the Australian Defence Force may face some challenges in the period leading up to 2030, as much of the capability being acquired by the government through its National Defence Strategy is not scheduled to become operational before the end of the decade. While the National Defence Strategy outlines ends, ways and means for the early 2030s, there is some risk in generating the tools for military strategy in the interim.

This brings us back to the dilemma posed by the Chinese naval group off Australia over the past two weeks. Despite the fleet of ships remaining in international waters and the comments from many that this activity raises no concerns for our future defence capability plans, it nonetheless does reflect on our current military capacity and highlights the urgent need for ongoing improvements in force projection, sea control and, where necessary, maritime strike.

More ships, submarines and long-range missiles will be essential for future solutions beyond 2030. But what about the present? One potential solution is to use the Australian Army, whose advancements in developing a future force focused on Australia’s maritime and littoral approaches are often overlooked in political discussions regarding the nation’s defence forces.

In the realm of land-based maritime strike, the government could accept some capability risk to expedite the acquisition of land-based anti-ship missiles. These systems can deter any foreign navy or future hostile power from entering home waters. The army could deter a blue-water navy in local waters, much as the Ukrainian Army has driven off the Russian Black Sea Fleet. While the Pacific Ocean is vast and land-based strike has its limitations, this strategy offers an immediate capability for defending home waters and addressing recent events, in contrast to ships and missiles not scheduled to arrive until 2030.

With the rapid acquisition of an army system to complement developments in the navy and the air force, Australia could calibrate its ends, ways and means both now and beyond 2030 as major projects are delivered.

The presence last week of a Chinese naval task group off our east coast in international waters demonstrates the sudden and dramatic pressure the Chinese navy can exert on our neighbourhood. Australia must implement an effective military strategy now; it cannot wait until 2030.