Policy report

China’s economic leverage: perception and reality

28 Mar 2017

Key points

Perceptions of Australia’s vulnerability to Chinese economic pressure are exaggerated. Some individual sectors are more vulnerable than others but this does not extend to the economy as a whole.

Economic pressure that would have the biggest impact on Australia, notably through the iron ore trade, would also impose restrictive costs on Beijing.

The intersection of politics, domestic interests and public perception is where China is most able to use economics for influence at the potential cost to our independent decision-making.

Policy recommendations

Strengthen transparency around the channels that China uses to build influence in Australia, including at the state, territory and business level as well as in its relations with the Commonwealth.

Improve awareness of Australia’s economic relationships, including our diverse investment ties, to give Australian voters and decision-makers more perspective about the nature and limits of Chinese influence.

Publication Details
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