Australia stabilises its foreign policy but hard choices lie ahead

Author: Allan Gyngell, ANU

Not for the first time in its history, distant events in Europe had a deep impact on Australia’s prosperity and security in 2022. Russia’s February invasion of Ukraine was the most blatant breach of international law and norms by a major power since World War II. It reshaped global economic and strategic settings, with direct and indirect consequences for Australia.

The war upended energy markets, reinforced the inflationary pressures arising from the COVID-19 pandemic and shook Western Europe’s sense of security, propelling the expansion of NATO and renewing fears of nuclear conflict. It bolstered a sense in the West of a deepening divide between democracies and autocracies and strengthened protectionist tendencies. In the global South, economic pain grew and, with it, the desire to avoid taking sides.

After nine years of rule by the conservative Liberal–National coalition, Australia’s federal election in May delivered victory to the Australian Labor Party. The election campaign itself was a muted affair, and the results were more a repudiation of former prime minister Scott Morrison’s leadership than an endorsement of Labor. Labor’s leader, Anthony Albanese, reassured skittish voters that his party proposed no radical disruption to their lives. On most of the big public policy issues — the economy, defence, relations with China — Labor’s critique was of the implementation, not the direction, of coalition policy. Climate change was the exception.

But the incoming government faced more challenging international circumstances than any for 50 years — an interconnected polycrisis, encompassing climate change and the environment, energy, the continuing pandemic, a deepening geopolitical divide and dysfunctional global institutions. The related domestic challenges included rising inflation, declining real wages and stagnant productivity.

The new government acted quickly to implement its election promises — introducing a more ambitious 2030 emissions reduction target, legislating a new anti-corruption body and addressing wage rises for low-paid workers. On the international front, Australians saw one of the most intense periods of travel by new ministers in years. Within hours of being sworn in as Prime Minister, Albanese flew to Tokyo for a Quad leaders’ meeting. A bilateral visit to Indonesia followed.

Albanese was accompanied by the new foreign minister, Penny Wong, who brought to her job ambition, deep portfolio knowledge and independent political weight. Wong has set out a foreign policy agenda for the new government which moved foreign policy closer to the centre of national decision-making.

The new government prioritised Australia’s relations with Southeast Asia and the South Pacific. This was not new in Australian foreign policy. But the fresh element was the ‘respectful listening’ to regional views and the insistence that the interests of these independent actors would affect and shape Australia’s.

The steps taken to address the largest failure of Australian public policy in the 21st century — the inability of both sides of politics to develop a sustainable energy policy — helped restore Australia’s international reputation, especially in the South Pacific.

On China, the new government shifted its language without abandoning its principles. Helped by reciprocal signalling from the Chinese side, a series of ministerial meetings, and an end-of-year trip to Beijing by Wong, restored patterns of regular high-level communications. Although trade and consular disagreements remained unresolved.

Policy continuity was clearest in the areas of alliances and security. Commitments to the AUKUS defence procurement arrangements and the Quad framework were reaffirmed. The most significant new developments came in the further expansion of defence cooperation with Japan, including a Joint Declaration of Security Cooperation.

But the most distinctive change in the Albanese government’s international policy was its assertion that the multiple strands of Australian national identity, from its First Peoples to the most recent immigrants, were central to the government’s international ambitions. Wong declared that ‘[w]hat we project to the world about who we are is an element of our national power’.

Albanese told university students in Indonesia that Australia’s multiculturalism and sense of itself as a nation went hand in hand with ‘how we see and project our place in the world’. His first public words on election night addressed the new government’s commitment to changing Australia’s relationship with its indigenous peoples.

This approach multiplied and diversified the strands of connection between Australia and the outside world. It did not involve walking away from traditional friendships but asserted that identifiers such as ‘the West’, or the Anglosphere, were insufficient to define Australia.

Harder challenges lie ahead. Not being Scott Morrison was enough to begin repairing strained relations with China and France. Australia’s close neighbours have been listened to respectfully and have responded positively. But the tensions that will present themselves between liberal values, national interests and regional commitments are still to be fully felt.

The release of the Defence Strategic Review early in 2023 will present the government with unprecedented decisions about the size of the defence budget and complex sovereignty choices. The growing clarity of Washington’s intentions to contain China’s growth and the uncertainty of China’s own trajectory, will generate more difficult choices. Hard policy decisions are yet to come on climate, energy and the environment. Yet the attentiveness and calm focus that has marked the Albanese government’s approach to the outside world in its first months in office gives it a solid template to follow.

Allan Gyngell is Honorary Professor at the College of Asia and the Pacific, The Australian National University, and National President of the Australian Institute of International Affairs (AIIA).

This article is part of an EAF special feature series on 2022 in review and the year ahead.

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