On Asia in Australia’s election year

1 February, 2022

Happy New Year!?

Foreign policy rarely features?prominently?in?Australian elections.?At a glance,?this year?won’t?be?any?different.

Australia’s two?major parties will campaign on how well or badly the?government?has?handled the COVID-19 pandemic and?the economy.?However, beneath?our?domestic issues?lie fundamentally?global?challenges.??

The pandemic’s trajectory in Australia is influenced by the spread and containment of new COVID variants abroad, especially in Asia. Our vaccination, testing and treatment programs are heavily reliant on global IP, manufacturers, and distributors – many of them in the region.?

?Our economy – while in strong recovery mode – has been hit hard in January by supply chain disruptions and labour shortages. Both are a result of a combination of domestic and international factors: the current outbreak of Omicron, scaled-down skilled migration in Australia, and manufacturing and shipping bottlenecks in Asia, especially in China, where Omicron puts the country’s zero-COVID strategy to the test.???

?We?may not hear?much about?Asia?in the election?messages, but it will weigh heavily on the minds of our political leaders.????

The incoming government brief for the newly elected leaders will not be happy reading. Our region continues to be ravaged by the pandemic. Our largest trading partners – the United States, China, Japan and Korea – are battling the outbreaks, with varying degree of success. The US-China competition looks set to accelerate this year, partly through the continuation of the decoupling led by both governments, but also by domestic political pressures. The U.S. midterm elections present the first major political test for Biden’s American revival agenda. China’s Winter Olympics and the Communist Party’s crucial 20th party congress, where President Xi is expected to secure an unprecedented third term as leader will make the Chinese system even more nationalistic and uncompromising. Both political events will leave little room for leaders to engage or negotiate. President Biden’s team will also be distracted by the Ukraine crisis.??

Around Asia?and the Pacific, 2022 will?be a big year of elections.?Voters in South Korea,?Philippines, India,?Japan, Cambodia,?Taiwan. PNG,?Fiji?and Timor?Leste?will go to the polls to elect their national?or local?leaders.??

Indonesia?has?assumed the?G20 Presidency?for 2022. President Joko Widodo?has?announced an ambitious agenda?focussing on global health governance, digital?transformation,?and energy transition?– issues fundamental to Australia’s interests. Indonesia’s presidency offers a significant opportunity for Australia to ramp up its political and economic engagement with?its neighbour, including through the Indonesia-Australia Comprehensive Economic?Partnership.???

India, another key Indo-Pacific partner for Australia, is celebrating 75 years of Independence – a major milestone for Asia’s largest democracy. An upcoming update to the India Economic Strategy and a possible visit by Prime Minister Modi or another senior Indian leader could help Australia and India to add more substance to our bilateral relationship, especially on the economic front.???

Australia will not be immune from potential economic shocks. China’s economic slowdown,?inflation,?supply chain issues?and rising shipping and energy costs,?cybersecurity, labour?shortages and, of course the pandemic?will?dominate?the?risk registers of Australian and regional?CEOs.??

A strong economy and major achievements in national security over the last two years - especially the AUKUS, strengthening of the QUAD,?the?defence cooperation treaty with Japan - put Australia in a good place to navigate uncertainties ahead.??

Australia has made the right call to continue re-opening “Fortress Australia”, safely but confidently, despite the Omicron outbreak. International education and research, skilled migration, professional and business mobility and an active trade agenda make Australia an attractive knowledge nation, while contributing to our national wealth.?

?The elections offer an opportunity?for?our leaders to share how they see Australia going forward, including on the international stage.??

?Both major political parties are largely on the same page on most critical issues in national security and foreign policy.??

Prime Minister Scott Morrison will rightly want to campaign on his Government’s foreign policy achievements. His?track-record is impressive.?The Opposition?has shown consistent support for most of the major policy?initiatives?and positions?of?the Morrison Government, including?on?defence,?the?U.S. alliance and?China, and?will resist being drawn to debate foreign affairs where the risks of appearing weak or out of step with national interests are high.??

?Bipartisanship on?foreign policy?is a?good story?of Australian democracy.??

But is it a genuine agreement or a fig leaf for the lack of political interest to debate?complex international issues??Our leaders?will be right?to reaffirm?their commitment to maintain?Australia’s role as?a global trading nation and an activist and responsible?regional?power.??

But bipartisanship must not stop a contest of ideas. Our politicians should not shy away from debating Australia’s security and economic prospects in Asia – publicly and regularly. On critical global challenges that touch all of us, such as climate change, global vaccine distribution, our relationship with China, immigration, aid and trade - Australians deserve to know their leaders’ thinking and differences between them.??

While there?are no?votes in foreign policy, there?must be votes in?keeping?Australia safe?and prosperous.??

So,?I hope to see our political leaders at Asia Society?and other?podiums?explaining how they intend to do it?in a less benign and predictable world.?

On a lighter note,?this?year?marks the 25th?anniversary of?Asia Society?Australia.?It’s a milestone we?look forward to?celebrating?with you.??

Best wishes for 2022.?

Philipp?Ivanov, CEO Asia Society Australia

(This is a section of my monthly letter to Asia Society Australia Members, January 2022)