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Between Japan and Southeast Asia: Australia and US–China economic rivalry

United States of America China Japan Australia Southeast Asia

Recently, the economic front of US–China major-power rivalry has deepened and expanded beyond the legalistic confines of the World Trade Organization (WTO).

Many in Australia, which has the US as its security ally and main source and destination of investment and China as its main trading partner, are rightly concerned by this evolution.

Within the WTO and outside, Australia’s alignment on the economic dimensions of the US–China contest has been consistent for decades. Here, Australia is less aligned with the US than Japan and less aligned with China than Southeast Asian states despite trading more heavily with China.

These economic alignments are consistent with these states’ alignments on the defence dimensions of the US–China major-power rivalry. Australia’s economic alignments are not consistent with the conventional wisdoms that trading (not broader economic) relations do or should determine strategic choices and that the alliance with the US undermines Australia’s strategic autonomy. 

They are consistent with the overarching ideas of grand strategy and the national interest.

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Strategic Insights 141