Columnists

Handling disputes with caution

By Guo Chunmei (China Daily)
Updated: 2009-08-05 07:52

The upward trend of Chinese-Australian relationship based on economic interdependence will carry on despite recent events. Upgrading the long-established bilateral friendship requires both sides to resolve disputes reasonably and display mutual understanding in economic and political spheres, especially when fundamental interests of each side are concerned.

Chinese-Australian interests converge on economic and trade relations. Industrial development makes China dependent on long-term steady and cheap supply of resources, which could be channeled via overseas acquisition and negotiations.

The road to acquisition has never been smooth largely because of non-economic suspicions of the countries involved, including Australia. This is typified by the debt-ridden Rio Tinto Group's sinking of its bid to raise cash from Aluminum Corporation of China, or Chinalco, in spring.

The path of negotiations has been marked by constant frustrations of the Chinese attempts year after year. The failure in the iron ore negotiation was particularly disturbing because the fact that China (as the largest importer of iron ore) should have a say in pricing was ignored. The current global recession puts the Chinese industry at a disadvantage. This prompted an industry-wide overhaul with thorough investigation, which naturally led to the discovery of Stern Hu's case and was followed by arrests of senior executives of Chinese companies.

The Chinese side seems to have intentionally kept the case to the individual level, for the sake of Australian feelings. The unexpectedly strong and politicized reaction from the Australian side drives itself into the potential marshland of interfering with Chinese judicial sovereignty.

The clanger at the Melbourne International Film Festival pointed to the Chinese belief in national unity as the ultimate interest. The festival organizers had struck the most sensitive nerves of the Chinese by screening the controversial documentary on Rebiya Kadeer, whose organization is behind the Urumqi riot of July 5 which left nearly 200 dead.

While the Han and the Uygur Chinese in Xinjiang mourned their dead, the Australian side insisted on showing a brazen ode to the head of a group that organized the riot and other terrorist attacks to split China and even welcoming her into town. How could the Chinese not be offended? It is most reasonable for Chinese film directors to withdraw from the festival and for the Ministry of Foreign Affairs to raise the issue.

If the Australian focus on Chinalco in February was downplayed in China and the spying by Rio Tinto Shanghai representative Stern Hu treated as an individual case, Australia's over-use of Rebiya Kadeer to say something else apparently lifted the disputes to the diplomatic field. Such escalation echoed the unfriendly noises of anti-China forces inside Australia.

In fact, it should not have been hard for the Australian public to see why the usually modest Chinese would respond strongly by July, because both events are in fact challenging China's primary interests, where the Chinese have no room to negotiate.

However, the unpleasant events could not obscure the fact that China and Australia need one another on the basis of complementary economies. The rapid development of Chinese manufacturing industries is a gold mine for Australia while the rich resources of the latter offer a stable source for China's economic growth. Even the opposition, which has attacked the administration of Prime Minister Kevin Rudd, had to admit the importance of China to the Australian economy. Such economic interdependence is a sound basis for bilateral relations over the years.

Special Coverage: Iron Ore Price Talks
Related readings: Australia urged to treat Rio Tinto spy case 'properly' Rio case discussed in Shanghai meeting China denies restriction of ties between domestic, foreign companies Australia: Rio case not to affect trade ties

In the international arena, China and Australia are counting on each other. The Rudd administration is moving ahead successfully with its diplomatic strategy of "integrating into Asia". Chinese support is often necessary if Australia wants to play its role as a creative mid-weight power. The Chinese, in the hope that Australia becomes a Western country that understands China, has been working to build an exemplary bilateral relationship. All the factors determine that the upward trend of Chinese-Australian relations established over a long time will not be derailed easily.

Since he took office in 2007, Kevin Rudd has gained credit for his Chinese knowledge, but such an achievement is an easy target for the opposition. It is understandable that his administration has to please voters in the pursuit for another term. But healthy bilateral relations cannot be mature and lasting unless they grow on mutual respect and interest. Such a relationship demands a cool and cautious approach towards disputes, and appropriate and timely guidance for the public. It is always advisable to "think again before acting" when hitting the baseline of the other party.

The biggest task for the Rudd administration so far could be to balance the overall situation both at home and abroad.

The author is with the China Institute of Contemporary International Relations.