Dirk van der Kley is Research Associate in the Lowy Institute's East Asia Program.
Julia Gillard's arrival in Beijing today has been preceded by the announcement that she will push for a strategic dialogue during meetings with President Xi Jinping and Premier Li Keqiang. This initiative — recommended by the Lowy Institute's Linda Jakobson in June 2012 (the section headed 'Regular Summit' explains why this is good policy) — is a much needed step in building a sturdier political architecture for a relationship that has been dominated by economics.
The business sector recognises the need for a stronger political relationship. Tony Shepherd of the Business Council of Australia says:
It is an indication of how important China is to Australia, to our children and our grandchildren, we’ve really got to build this relationship, not just business to business but politically and culturally.
During my past month in China, I have been struck by the fact that, while people generally have warm feelings towards Australia, there is still very little interest in Australia culturally or politically. The country is seen primarily as a destination to study or emigrate because of its immigration laws and stability rather than for any specific affinity towards Australia.
There also seems to be a widespread perception both at the academic and societal level that Australian foreign policy is enmeshed with the US. This is underlined by the fact very few Chinese academics based in China do research specifically on Australia's foreign policy.
Unfortunately for Australia, it has few options for differentiating itself politically from other countries in what has become a congested space. The Prime Minister's visit is a case in point. China already has a strategic dialogue at the ministerial level with at least eight other G20 countries, as well as some countries outside the G20.
Similarly, Prime Minister Gillard's attendance at the Boao Forum could get 'lost in the crowd'. There will likely be 2000 attendees (if last year's figures are any guide), while more than ten heads of state have confirmed their attendance, although admittedly not many are from the G20. Given it has been two years since the Prime Minister's last China visit, this is a decidedly cluttered environment with which to begin a second trip.
Politically, this matters. In a relationship where the two countries are joined economically at the hip but with vastly different political systems, problems will naturally arise. A strong political relationship at the ministerial level will help but some issues don't require ministerial intervention and this needs a robust relationship at lower levels. For this to occur, long-term access at all levels extending well past the tenure of one individual in one position will be necessary. This can only happen if there is a compelling reason on the Chinese side for interaction at different levels.
Economically, 'being heard' matters in investment, which is naturally more difficult than trade. Of course, individual projects are the deciding factor for investment. But, any perception that Chinese investment is unwelcome can be smoothed by a bilateral relationship that is seen to be stable and friendly. This will be important in an increasingly competitive environment for attracting Chinese FDI. It will also be vital as the range of Chinese companies investing abroad changes, bringing investment diversification beyond Australia's traditional strengths of resources and energy.
Regardless of whether Australia gets its strategic dialogue now or in the future, if Canberra wants to ensure its voice is heard in Beijing, it will need to make a long-term case for why it is more important than any number of other mid-size powers that also want a seat at the table. Australia could profile itself politically as not merely a loyal ally of the US, but as a country with a more unique foreign policy identity. The current economic case alone will not suffice. There are many places Chinese companies can invest or source resources from.