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Since 2017, the political and diplomatic relationship between Australia and China has seen better days; notably, in that, no Australian Prime Minister has been invited to China since 2016. Yet despite these tensions, the economic relationship remains strong. The traditional mainstay of the trading relationship (natural resources for manufactured goods) remains solid and has been joined by an increasing flow of services (tourism, education, and logistics). Even the lingering critique of the Australia–China economic relationship that it is largely transactional—that is, useful for the balance sheet now but not particularly important as a driver of long- run improvements in living standards—no longer appears to hold. This is demonstrated in China having now emerged as Australia’s leading partner in scientific research collaboration, in no small part off the back of people-to-people flows between research institutions in both countries. The early data indicate that even the COVID-19 crisis has been unable to remove China as critical to Australia’s international economic horizon (albeit affecting education and tourism). There are factors pushing in a different direction, such as the impact of US-China strategic competition on Australia–China science and technology research collaboration, and a widening gap between Australia and Chinese interests as calculated at a political level in both countries. But the resilient economic relationship serves to make the point that much of the Australia–China relationship takes place amongst different actors with different calculations, and the national interest benefits of these interactions have not escaped the attention of political decision makers.

Read the book chapter online here.

Note: This book chapter was published in Transcultural Connections: Australia and China, Encounters between East and West (Intercultural Perspectives), Springer, Singapore, pp 21-36.

Author: James Laurenceson, Director, Australia-China Relations Institute, University of Technology Sydney.