Xi Jinping
Chinese President Xi Jinping

There is a fascinating parallel between US President-elect Donald Trump’s rhetoric and that of Chinese President Xi Jinping. It’s one that should frighten a no-doubt already worried Canberra, and indeed all Australians.

In Xi’s initial speech after being appointed secretary general of the Chinese Communist Party, he made an impassioned speech about the things that Chinese people were seeking: healthcare, education, peace and good government. In describing these things, he was all too happy to paraphrase the platitude of countless American leaders, describing this as “the Chinese Dream”. Sheared of the impenetrable party-speak used by his predecessor Hu Jintao, it was a breath of fresh air. In person, Xi comes across well, with low-key avuncular charm, a person of reason — his opening pitch went across well with the assembled media throng, including a hundreds of foreign correspondents.

Since then, the full realisation of what this Chinese Dream entails has become clear and that breath of air was, actually, far from fresh. Rather it was stale air from the Mao Zedong era. Added to the basics of the Chinese Dream came the growing nationalism that Xi’s ever-eager propaganda machine has assiduously and insidiously used to whip up first anti-Japanese fervour — the easiest button to push in China — and subsequently anti-Western feeling.

In tandem, the country has slowly but steadily removed the equipment — especially information technology — provided by mainly US companies, and also began bringing jobs back to China, if you like (even though much of the US manufacturing was actually done in China in the first place).

The anti-corruption campaign that has been used to pick off his enemies (“Lock Her Up”, anyone?) and markedly stepped up censorship programs. All this could easily be summarised as a campaign entitled “Making China Great Again”, if you like. In fact, this has been a slow-burning, escalating theme of the Chinese leadership for some time now. It has been bolstered with action: the rapid ramping-up of the modernisation of Chinese 2.3 million-strong People’s Liberation Army and the aggressive occupation of parts of the South China Sea where the country has been building islands that are fast being militarised.

Now, as Xi and his propaganda chiefs continue to ramp up their Making China Great campaign, pushing forward with their outrageous illegal claims in their littoral seas, they have suddenly found themselves staring across the Pacific Ocean at a mirror image in the form of Donald Trump.

There are, as yet, so many unanswered questions about what a Trump presidency will do, policy-wise.

But the specific policies targeted squarely at Asia — and China in particular — were remarkably clear. Both economic and strategically, Trump has made it clear that, despite his use of cheap Chinese steel to construct his buildings, he does not like China, much less its only real ally: North Korea. There has been much naysaying, most of it unfounded, about US President Barack Obama’s — and he still is the President for almost three months — famed “pivot” towards Asia. But it has been real and must be understood in the context of a very stretched US military as well as the flawed Trans-Pacific Partnership (TPP).

Under President-elect Donald Trump, we are likely to see that pivot, well, pivot, in terms of intent.

Obama’s original policy decision was always good for Australia, one of the US’ staunchest allies who had supported out of our eternal, perhaps misguided loyalty, to our Anglophone allies in the same way as we jumped into WWI, WWII and the Vietnam War.

At last, after losing so many Australian lives on the other side of the world — most recently in the Middle East and Afghanistan — some support was once more heading our way.

The Obama pivot was a belated realisation that, in its deep involvement in the Middle East, triggered by the horrific events of the September 11 attacks on New York and Washington, the US had taken its eye off a major issue in its own backyard: the Pacific region and the rapid rise of China. Combined with a rebalancing of the US’ reduced military forces, still massively outgunning any one else’s, was the soft power arm to the containment of China (let’s call a spade a spade).

Under Trump, the options will be less subtle and therefore potentially more dangerous both economically and strategically. Any moves to weaken the economy of China — such as Trump’s promised 45% tariff on Chinese goods — would have a direct and an immediate impact on Australia’s economy. The risk premium that has just been added to global markets will hit developing economies — and that means all of Asia, where most of Australia’s trade lies — hardest.

More broadly, here’s the rub for Australia as explained by Tracey McNaughton, head of strategy at UBS Asset Management, a large fund manager:

“When you have more nationalistic tendencies you get inefficiencies and upward pressure on inflation. This will affect anything to do with trade — commodities and commodities currencies.”

Militarily, well, it seems that all bets are off. Putting to one side the budding romance with Putin, Trump has offered to provide Japan and South Korea with nuclear weapons, so really, who knows what he might try?

But there is not even a skerrick of good new for Asia or Australia.

Peter Fray

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