Australia fears having to choose between China and US

Peter Varghese

Australia does not want to be put in the position where it has to choose between the US and China, the new head of the Department of Foreign Affairs and Trade has declared.

In his first major public speech since taking over as DFAT secretary, Peter Varghese said: “The challenge for all of us is to help prevent a US-China faultline running through Asia. Conflict between the US and China would be a disaster for everyone: the US, China, the region and the world.”

Mr Varghese took up his new post two months ago.

“We wish to see a strong and stable US-China relationship, and we will do all we can to support it,” he told Asialink in Melbourne last night.

He said that economic interdependence would work, up to a point, in keeping the US and China from an adversarial relationship. “But it is no guarantee,” he added.

China had become the largest trading partner of 124 countries, Mr Varghese said, whereas the US was now the leading partner of 76 economies, down from 127 five years ago. Mr Varghese said Australian interests were best served by a stable balance of power in Asia that encouraged economic integration, was inclusive in membership and looked outward.

“Our strongest partner in securing these objectives is the US with whom we share both interests and values. This intersection of interests and values is also true of our relationships with Japan, India, Indonesia and Korea.”

The primary burden of managing stability in Asia, he said, would fall on “bilateral relationships and smaller networks of relationships among the major powers of the region.”

He views “the Indo-Pacific, rather than East Asia or even the Asia-Pacific, as the crucible of Australian security”, and includes our top nine trading partners.

“It connects the Indian and Pacific Oceans, thereby underlining the crucial role that the maritime environment is likely to play in our future strategic and defence planning,” Mr Varghese said.

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