Former trade minister urges Australia to exercise regional influence independent of the two superpowers

This article is more than 2 years old

This article is more than 2 years old

The United States is engaged in a “futile and counterproductive” attempt to contain China, and Australia should exercise its influence independently of both superpowers, former trade minister Andrew Robb has said.

Delivering the Australian mining industry annual lecture in Melbourne on Monday, Robb suggested the industry faces two major challenges in containing project costs and maintaining trade relationships in Asia as the US and China struggle like “two bulls in a paddock”.

The intervention from the former Coalition minister comes as the Turnbull government seeks to hose down tensions with China over its foreign interference package – of which Robb was a noted critic – and China hits back at Donald Trump in the escalating trade war with the US.

Robb – who founded an investment advisory firm and controversially took a contract with Chinese-owned Landbridge a day before he left office – said China and India are “re-emerging” to positions at the “political and economic centre of gravity in the world”, which they had enjoyed for 18 of the last 20 centuries.

“Unfortunately, the United States appears yet to accept this inevitability, with both sides of the political aisle in Washington endlessly focusing on ‘containment’ of China – a futile and counterproductive approach, in my view,” he told the Minerals Council of Australia event.

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Robb said power-sharing between the US and China is “the biggest opportunity and potentially the biggest threat” for the Indo-Pacific region. He argued history shows both that power-sharing “can be fraught with conflict” but that “conflict is not inevitable”.

“Done effectively, such a transition to a workable balance of power in our region will see the China development experience repeated in India, Indonesia, Vietnam, Malaysia, Thailand and the remaining Asean countries in the decades ahead,” he said.



Robb said Australia was “blessed with ample quality resources” to support China as it shifts to become a consumer society and other Asian countries as they develop.

“However, our potential involvement is not inevitable,” he said.

Robb warned “Australia does not control the supply of any commodity”, so to capitalise on opportunities it must maintain trade relationships with China and other Indo-Pacific countries, and urgently correct “our bloated, dysfunctional and costly project approval processes”.

He said Australia is a middle power but can be “effective in influencing sensible outcomes”, citing the fact Australia was able to convince China to comply with best practice governance as a condition of joining the Asia Infrastructure Investment Bank.

“Such an approach shows that neither Australia nor any other sovereign nation for that matter needs to tug the forelock to any demand by the superpowers,” he said.

Robb noted the US’s “blanket opposition” to the infrastructure bank and “relinquishment of leadership in freeing up global trade” have “alarmed many countries”, especially Asean nations, who “feel that they now have no one looking after their backs in dealings with China, as its influence grows”.

As one of the most trade-exposed industries, the mining and energy sector needed Australia to show “strong but respectful diplomacy” to navigate an “increasingly tense power struggle”, he warned.

“The alternative of leaving two bulls in a paddock to fight it out is no answer.”

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The US recently announced it intends to target $50bn worth of Chinese goods with 25% tariffs, which prompted retaliatory tariffs from China.

Malcolm Turnbull has consistently argued for free trade in the face of increasing US protectionism, but the prime minister has also angered China by targeting it in debates about foreign interference legislation, which passed last week.

Robb argued Australia is in competition with new mining regions in Africa and South America, while Australian regulation is “increasingly a major deterrent” for investors.

“Major duplication, lack of coordination, lengthy delays, costly reports, endless litigation and the sheer growth in the number of approvals required by all levels of government is seeing major projects face the requirement for literally many thousands of separate approvals.”

Regulation should be more “common-sense and efficient”, he said, or Australia would price itself out of the investment market.

Robb praised the Australian mining and energy sector for leading the world in lowering costs through innovation, including use of big data, robots, artificial intelligence, autonomous drills, driverless trains and “intelligent mines”.