Julian Leeser (Berowra, Liberal Party) Share this | Link to this | Hansard source

I'd like to speak today on the Australia-China relationship, and in particular to reflect on an experience that I had recently courtesy of China Matters, an Australian government funded public policy initiative that took me, the member for McMahon as well as the distinguished Australian businessman Andrew Parker, the head of PWC's Asia practice, to China to more deeply understand the relationship between our two countries.

Australia's relationship with China is absolutely vital. It goes back to 1972 when we first recognised China and had diplomatic relations. We have maintained since that time the one-China policy. China is our most significant trading relationship on the basis of two-way trade. It's very important to the economic prosperity of Australia. It's important to the future of Australia. It's also important to the future of China. Australia is China's seventh-highest principal import source and the 14th-highest principal export source. Australia sends to China things like iron ore, coal, wool, other animal products and copper. We buy from China telecommunications equipment, computers, manufactured goods, furniture, toys and the like. So the relationship is very important, and it's important to have a strong understanding of the nature of the relationship.

This visit to China wasn't an official visit—there weren't black cars and delegations—rather it was an opportunity to try to understand how middle-class Chinese people are thinking and feeling about the current situation there. It was not just about middle-class Chinese people but also about people from other countries who are engaging with China in a business and diplomatic sense.

There were three really interesting things that I took away from this trip. Firstly, China has had remarkable growth, lifting millions of people out of poverty. Particularly the growth of China's coastal cities is very impressive, but that growth is slowing down now, and we're seeing that—as we were repeatedly told—in the reduction of consumption of things like automobiles and other consumable goods. That slower growth will put pressure on China in the next few years.

Secondly, the trade war with the United States will provide greater instability in China's economy. The US President has already put $50 billion worth of tariffs on China, announced another $200 billion and flagged possibly another $267 billion. This is a bipartisan position in the United States.

The third thing that we saw was a more repressive environment generally, where middle-class people felt that they weren't able to, as freely as before, go about their business. These were three particularly interesting things.

I'm pleased to see that Prime Minister Morrison has said that he's not going to be conducting his diplomacy with the Chinese through the media but rather through person-to-person contact and looks forward to meeting the leadership at APEC. The Australia-China relationship is very important. It's complex. Our major trading partner is not our major national security partner, but we're a mature enough democracy and the relationship is mature enough to manage both those things.