Australia in the World Darren Lim

Mike Pezzullo recently said that “the likelihood of conflict in this decade has been about 10 per cent, which is meaningful enough to plan for and indeed to be concerned about”. If Pezzullo’s assessment is correct, that means there is a 90 per cent chance that conflict will not happen. What is Australia’s plan for that (likely) scenario? This episode is about that 90% world, where Australia’s relationship with China will still matter greatly, as Beijing’s behaviour influences many of our interests, not just geopolitics and national security.
How might Australia consider thinking about a cooperative agenda with the PRC? In the words of PM Albanese, his government’s approach is to “co-operate with China where we can, disagree where we must and engage in our national interest”. Where can we cooperate, especially given the deep freeze in political relations that the two countries are only now climbing out of? What does engagement in the national interest mean given the extent to which China can affect many things we care about?
Darren is joined in this conversation by Dr Paul Hubbard. Paul is trained as an economist, first joining the Australian Public Service in 2006, and was sent from there to the ANU as a Sir Roland Wilson PhD Scholar in 2014.  More recently, in his capacity as a National Government Fellow at the ANU, Paul led a small team to produce a report - "A Sustainable Economic Partnership for Australia and China" that was launched in May. The report proposes an agenda for how Canberra and Beijing can take their economic relationship forward, and the two discuss that in the context of the broader question of what it means to develop a cooperative agenda with China and how should we think about the constraints imposed by geopolitics on that work?
Note: the report reflects the views of the ANU research team, and Paul’s comments in this episode are in an unofficial capacity as an expert on the Chinese economy, and do not represent the views of the Australian Government or its agencies.
Australia in the World is written, hosted, and produced by Darren Lim, with research and editing this episode by Walter Colnaghi and theme music composed by Rory Stenning.
Relevant links
“A Sustainable Economic Partnership for Partnership for Australia and China”, East Asian Bureau of Economic Research, Crawford School of Public Policy, ANU, May 2024: https://eaber.org/wp-content/uploads/2024/05/A-Sustainable-Economic-Partnership-for-Australia-and-China.pdf
Partnership for Change: Australia–China Joint Economic Report, Report authored by East Asian Bureau of Economic Research and China Center for International Economic Exchanges, August 2016: https://press.anu.edu.au/publications/partnership-change#:~:text=The%2520Australia%E2%80%93China%2520Joint%2520Economic,in%2520both%2520Australia%2520and%2520China.
2017 Foreign Policy White Paper: https://www.dfat.gov.au/sites/default/files/2017-foreign-policy-white-paper.pdf
Paul Hubbard and Dhruv Sharma, “Understanding and applying long-term GDP projections”, EABER Working Paper Series, Paper No. 119, June 2016: https://eaber.org/wp-content/uploads/2016/06/EABER-Working-Paper-119-Hubbard-Sharma.pdf
Paul Hubbard, A Wealth of Narrations: https://www.amazon.com.au/Wealth-Narrations-1-PC-Hubbard/dp/B0CR6TXX7C
Chris Miller, Chip War: https://www.simonandschuster.com.au/books/Chip-War/Chris-Miller/9781398504127
The Ezra Klein Show, “Israelis Are Not Watching the Same War You Are:, Interview with Amit Segal, 14 June 2024: https://www.nytimes.com/2024/06/14/opinion/ezra-klein-podcast-amit-segal.html

Joining Darren this episode is Jude Blanchette. Jude holds the Freeman Chair in China Studies at the Center for Strategic and International Studies (CSIS). There’s no-one whose analysis and commentary Darren values more highly in helping him understand China.  
The context for this discussion is the fact that this weekend China’s Premier Li Qiang will visit Australia, the first visit by Chinese #2 since 2017. Following on from PM Albanese’s trip to Beijing late last year, and FM Wang Yi’s trip to Australia in March, Premier Li’s visit will continue the process of unfreezing the political relationship, what the current Australian government famously labels ‘stabilisation’. However, the Albanese government has not escaped criticism for its approach to China. Some would argue Canberra has gone softer on Beijing than it could have, whether on responding to dangerous actions by the Chinese military, or on perennial issues like human rights. And there’s also been a criticism of stabilisation as strategy – what is the goal of stabilisation? What is the end state?
What is striking about these criticisms is how similar they are to criticisms of the Biden’s administration’s approach to China, which is often given the label ‘competition’. What is the goal of competition? Does the US just ‘compete’ indefinitely, a kind of steady-state, or should it be focused on an ‘end-state’? A recent piece by former Trump administration China lead Matt Pottinger and retiring GOP Congressperson Mike Gallagher argues that the goal should be not to compete, but to win.
With all this as context, recently Australia’s Department of Foreign Affairs and Trade hosted a group of US-based China experts here in Canberra, presenting Darren with an opportunity to interview Jude in-studio. Jude also hosts the excellent Pekingology podcast, where he interviews scholars and researchers who study the actions of China’s government and the CCP in particular.
In our conversation we cover Australia-China relations, US-China relations and the links between the two, and many other things besides. We start, of course, with the concept of stabilisation in the Australian context, but very quickly that broadens out into a discussion of the Biden approach given its parallels with stabilisation, and the Pottinger/Gallagher critique. We then turn to the question of how to influence China, and the balance between wielding direct influence versus working indirectly with partners. I ask Jude how he explains the apparent adjustment in PRC foreign policy in recent years, and how a potential Trump return to the Presidency might shake things up.
Above all however the big question overshadowing our discussion is this: what’s the best way of forging a long-term China strategy, how early are we into the competition phase with China, and how long will it last? And what is the narrative needed to sustain such a strategy?
Australia in the World is written, hosted, and produced by Darren Lim, with research and editing this episode by Corbin Duncan and theme music composed by Rory Stenning.
Relevant links
Jude Blanchette (bio): https://www.csis.org/people/jude-blanchette
Pekingology (podcast): https://www.csis.org/podcasts/pekingology 
Matt Pottinger and Mike Gallagher, “No Substitute for Victory: America’s Competition With China Must Be Won, Not Managed”, Foreign Affairs, May/June 2024: https://www.foreignaffairs.com/united-states/no-substitute-victory-pottinger-gallagher
David Engerman, Know your enemy: The Rise and Fall of America's Soviet Experts (book): https://global.oup.com/academic/product/know-your-enemy-9780195324860
The Gloaming (band): https://www.youtube.com/c/thegloaming
Zach Bryan, “I remember everything” (feat. Kacey Musgraves): https://www.youtube.com/watch?v=ZVVvJjwzl6c

Two guests join Darren this week: Professor Joanne Wallis from the University of Adelaide and Professor Bec Strating from La Trobe University. They have recently published a book titled Girt by Sea: Reimagining Australia’s Security, published by Blank Inc. Their project is an ambitious one—to question the very foundations of what it means for Australia to be secure, and indeed who indeed it is that needs to be secure, and therefore how Australia should understand its strategic challenges and find lasting security. The importance of this book is demonstrated by fact that Foreign Minister Penny Wong launched it recently in Adelaide, where the Minister said that the questions the authors ask in the book are many of the questions she herself grapples with.
This is not however a standard “let’s talk about my new book” episode, because when Darren read Girt by Sea he was struck how much the book’s arguments were consistent with what he understands to be “progressive” principles of foreign policy thought. While Bec and Joanne do not fully embrace the progressive label for their work, it is nevertheless an interesting and arguably useful lens to frame the conversation, including the authors’ ‘reimagining’ project. In contrast, Darren would not label himself as a progressive thinker and disagrees with the book’s starting premise that Australian security needs reimagining, perhaps revealing himself to be a cranky conservative! But, hopefully, disagreement makes for an engaging conversation.
Australia in the World is written, hosted, and produced by Darren Lim, with research and editing this episode by Corbin Duncan and theme music composed by Rory Stenning.
Relevant links
Joanne Wallis (bio): https://researchers.adelaide.edu.au/profile/joanne.wallis
Bec Strating (bio): https://scholars.latrobe.edu.au/bstrating
Girt by Sea: Re-Imagining Australia's Security (Black Inc, 2024): https://www.blackincbooks.com.au/books/girt-sea-0
Bisley, N., Eckersley, R., Hameiri, S., Kirk, J., Lawson, G., & Zala, B. (2022). “For a progressive realism: Australian foreign policy in the 21st century”. Australian Journal of International Affairs, 76(2), 138–160. https://doi.org/10.1080/10357718.2022.2051428
Van Jackson, Grand Strategies of the Left: The Foreign Policy of Progressive Worldmaking (Cambridge University Press, 2023): https://www.cambridge.org/core/books/grand-strategies-of-the-left/966D16DBED1238269D1B4816F41AEF7D
Statecraftiness: Mapping Competition, Cooperation, and Coercion in the Pacific Islands: https://www.adelaide.edu.au/stretton/our-research/security-in-the-pacific-islands/statecraftiness
Asia Rising (podcast): https://www.latrobe.edu.au/asia/podcasts
Taylor Swift, “Florida!!!” (feat. Florence + The Machine) (Official Lyric Video): https://www.youtube.com/watch?v=uEssK8o3jKg

Recent events in economic security (or, geoeconomics) have been dizzying, but exciting for Darren given this is his primary academic field. In Australia, the new budget delivered by the government plans over $20b of industry policy funding for a “Future Made in Australia”. Meanwhile in the US, the Biden Administration has sharply increased tariffs on Chinese goods focused on green energy. The US wants to cultivate domestic manufacturing, in part because it sees PRC dominance of green technology as a national security risk.
This means there is a lot to discuss! In this episode Darren talks with Hayley Channer. who is the Director of the Economic Security Program with the United States Studies Centre at the University of Sydney. Hayley has a diverse background having worked as an Australian Government official, Ministerial adviser, think tank analyst, and represented global non-profit organisations. Prior to her current role, Hayley was a Senior Policy Fellow with the Perth USAsia Centre and, amongst other accolades, was awarded a Fulbright Scholarship in 2022.
This lengthy discussion covers the goals of economic security policy and the inherent trade-offs in this domain, particularly in the context of both Australia’s and the US’ emerging industrial policy efforts, as well as the problem of responding to economic coercion.
Australia in the World is written, hosted, and produced by Darren Lim, with research and editing this episode by Walter Colnaghi and theme music composed by Rory Stenning.
Relevant links
Hayley Channer (bio): https://www.ussc.edu.au/hayley-channer
Anthony Albanese, “A future made in Australia”, Speech, 11 April 2024: https://www.pm.gov.au/media/future-made-australia
Jim Chalmers, “Economic security and the Australian opportunity in a world of churn and change”, Speech at Lowy Institute, 1 May 2024: https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/speeches/address-lowy-institute-sydney
Hayley Channer and Georgia Edmonstone, “What does ‘economic security’ mean to Australia in 2024?”, US Studies Centre Brief, 30 January 2024: https://www.ussc.edu.au/what-does-economic-security-mean-to-australia-in-2024
Lim, D. (2019). Economic statecraft and the revenge of the state. East Asia Forum Quarterly, 11(4), 31–32: https://eastasiaforum.org/2019/12/04/economic-statecraft-and-the-revenge-of-the-state/
Ferguson, Victor A., Darren J. Lim, and Benjamin Herscovitch. “Between Market and State: The Evolution of Australia’s Economic Statecraft.” The Pacific Review 36, no. 5 (September 3, 2023): 1148–80. https://doi.org/10.1080/09512748.2023.2200026
Victor A. Ferguson, Scott Waldron and Darren J. Lim (2022), “Market Adjustments to Import Sanctions: Lessons from Chinese Restrictions on Australian Trade, 2020-21”, Review of International Political Economy”, http://doi.org/10.1080/09692290.2022.2090019
Darren J. Lim, Benjamin Herscovitch, and Victor A. Ferguson, “Australia’s Reassessment of Economic Interdependence with China”, in Strategic Asia (2023): https://www.nbr.org/publication/australias-reassessment-of-economic-interdependence-with-china/
Leading (podcast), “Speaking Truth to Trump | Former Head of Trump’s Communications, Anthony Scaramucci”, 21 February 2024: https://www.youtube.com/watch?v=juvfEZsZqUY&list=PL_6zDbB-zRef_M7eXuSLUlGnt7qk66hJq&index=9
Abhijit V. Banerjee, Esther Duflo, Good economics for hard times: Better answers to our biggest problems (2019): https://www.goodreads.com/book/show/51014619-good-economics-for-hard-times (Goodreads page)
Dani Rodrik, “Don’t Fret About Green Subsidies”, Project Syndicate, 10 May 2024: https://www.project-syndicate.org/commentary/green-subsidies-justified-on-economic-environmental-and-moral-grounds-by-dani-rodrik-2024-05

Zack Cooper of the American Enterprise Institute joins Darren to discuss the troubling trend of PRC military actions that are endangering Australian personnel and equipment, and those of our partners. Last week, a Chinese fighter aircraft dropped flares into the path of an Australian helicopter that was conducting a patrol in international waters as part of sanctions-enforcement against North Korea. Australia lodged diplomatic protests and PM Albanese called the action ‘completely unacceptable’. Similar incidents have happened before. Last year Australian naval divers suffered minor injuries after a Chinese warship released sonar pulses, and there have been other aerial incidents as well.
Why are Chinese forces doing this? Can Australia respond, either unilaterally or with partners? Is an increasingly risky maritime domain now simply part of the price of protecting our interests? Zack talks Darren through his perspective on these issues.
Australia in the World is written, hosted, and produced by Darren Lim, with research and editing this episode by Walter Colnaghi and theme music composed by Rory Stenning.
Relevant links
Andrew Greene, “Australian helicopter forced to take evasive action after Chinese fighter detonates flares”, ABC News, 6 May 2024: https://www.abc.net.au/news/2024-05-06/australian-helicopter-chines-fighter-flares-hmas-hobart/103812042
Euan Graham, “China’s latest unsafe interception at sea was no accident”, ASPI Strategist, 8 May 2024: https://www.aspistrategist.org.au/chinas-latest-unsafe-interception-at-sea-was-no-accident/#:~:text=China%20habitually%20denies%20engaging%20in,endangered%20China's%20maritime%20air%20security
Sam Roggeveen, “Helicopter flare up should highlight China’s base instincts”, Lowy Interpreter, 7 May 2024: https://www.lowyinstitute.org/the-interpreter/helicopter-flare-should-highlight-china-s-base-instincts
Corey Lee Bell and Elena Collinson, “The Yellow Sea flare incident: Expect more of the same”, ACRI Perspectives, 13 May 2024: https://www.australiachinarelations.org/content/perspectives-yellow-sea-flare-incident-expect-more-same
Nicholas Eberstadt, “East Asia’s Coming Population Collapse: And How It Will Reshape World Politics”, Foreign Affairs (online), 8 May 2024: https://www.foreignaffairs.com/china/east-asias-coming-population-collapse
Net Assessment (podcast): https://warontherocks.com/category/podcasts/net-assessment/

Stephen Dziedzic of the ABC once again joins Darren to discuss a busy month of news, starting with the recent election in Solomon Islands, then a bombshell Washington Post story about the alleged involvement of the Indian government in targeted killings (with a strong Australian angle); next the recent 2+2 bilateral with South Korea and the possibility of others joining onto AUKUS Pillar 2, and finishing with FM Penny Wong’s statement that statehood for Palestine is required to break the cycle of violence.
This episode was recorded on Friday 3 May, exactly one year following the death of Allan Gyngell. He is dearly missed.
Australia in the World is written, hosted, and produced by Darren Lim, with research and editing this episode by Walter Colnaghi and theme music composed by Rory Stenning.
Relevant links
Stephen Dziedzic, Chrisnrita Aumanu-Leong, Evan Wasuka and Doug Dingwall, “Former diplomat Jeremiah Manele elected as new Solomon Islands prime minister”, ABC News, 2 May 2024: https://www.abc.net.au/news/2024-05-02/solomon-islands-new-prime-minister-election-jeremiah-manele/103791138
Greg Miller, Gerry Shih and Ellen Nakashima, “An assassination plot on American soil reveals a darker side of Modi’s India”, Washington Post, April 29, 2024: https://www.washingtonpost.com/world/2024/04/29/india-assassination-raw-sikhs-modi/
Penny Wong, “Speech to the ANU National Security College “Securing our Future”, 9 April 2024: https://www.foreignminister.gov.au/minister/penny-wong/speech/speech-anu-national-security-college-securing-our-future
Bettany Hughes, “The Seven Wonders of the Ancient World” (book): https://www.hachette.com.au/bettany-hughes/the-seven-wonders-of-the-ancient-world
Serial, Season 4 (podcast): https://www.nytimes.com/interactive/2024/podcasts/serial-season-four-guantanamo.html  
Ezra Klein Show (podcast), “Salman Rushdie is not who you think he is”, 26 April 2024: https://www.nytimes.com/2024/04/26/opinion/ezra-klein-podcast-salman-rushdie.html