Analysis: Australia risks Pacific escalation with Aukus pact

Australia's defence treaty with the UK and the US has made waves well beyond the country’s immediate neighbourhood and could have serious economic and strategic consequences, Australian critics have said.

Worsening ties between Beijing and Canberra already cost Australia $2.3 billion in lost trade with China last year alone, according to the Australian Bureau of Statistics.

The French government withdrew its ambassadors to Australia and the US in response to Canberra’s scrapping of a long-standing A$90bn ($65.36bn) nuclear submarine deal with French company Naval Group.

The French authorities cited “unacceptable behaviour between allies and partners” when withdrawing their ambassador, Jean-Pierre Thebault, who told The Sydney Morning Herald and The Age that Australia had engaged in “lies and treason” for 18 months.

He said there was an “intentional breach of trust”, and “when something serious happens between two countries, really serious, there is a need for reassessment, and obviously consultation at high levels”.

Regional arms race

New Zealand Prime Minister Jacinda Ardern has declared that any nuclear submarines acquired by Australia will not be allowed in her country’s waters.

Her position, consistent with New Zealand’s long-standing nuclear-free policy, was made clear on Thursday as the Australian Greens slammed Canberra’s pursuit of the vessels, describing them as “floating Chernobyls”.

Malaysian Prime Minister Ismail Sabri Yaakob expressed concern that the new defence alliance will trigger a nuclear arms race in the Indo-Pacific.

He joined the Indonesian authorities in sounding the alarm over a military build-up and the effect that the Aukus pact could have on regional stability.

Could Aukus hit trade?

Mark Beeson, professor of international politics at the University of Western Australia, told The National that the new arrangement reflected Australia's long-standing identification with the US and Britain.

“[Former prime minister Robert] Menzies said Australia always needed great and powerful friends, and it used to be Britain. Since the Second World War it has been the US," he said.

"To ensure the US has remained engaged in Australia’s regional interests, successive Australian governments have gone out of their way to ingratiate themselves with the United States, and have taken part in every war the US has been involved in since the Second World War, even when they may have not been in Australia’s interests."

Prof Beeson said there is “an overwhelming sense of insecurity amongst strategic and policy-making elites” in Australia.

“The places this community gets their advice from is fairly limited … so there is a bit of groupthink in terms of what is regarded as being appropriate and serious responses to strategic issues.”

Mr Beeson said the involvement of the UK in the security pact is “noteworthy – and odd”.

“It is part of rebadging Britain, post Brexit, as a global player … but sending an aircraft carrier to the South China Sea is preposterous,” he said, noting that alienating France could ultimately undermine Australia’s strategic interests in the region.

Rival nuclear blocs?

Alexey Muraviev, associate professor of national security and strategic studies at Curtin University, told The National that the pact had significant implications on a number of levels – “military-strategic, political, and political-economic”.

“In terms of the military-strategic, the nuclear submarine deal is the first major announcement in a series of joint activities this new pact will engage in in the foreseeable future."

"We should not just think of this in terms of enhancing the capabilities of the Royal Australian Navy. This provides Australia with a capacity that Australian defence by and large didn’t have in the past, ever: a fleet of strategic platforms that considerably enhance power projection and strategic strike capabilities,” he said.

“It will alter the balance of power. Right now there are four major military powers with nuclear submarine capabilities in the Asia-Pacific: the United States, Russia, China and India. We have the UK visit … and the French have the capacity to deploy in the region. Australia will be the fifth power in residence with that capacity. It is a significant development.”

“China talks about the danger of an arms race. They will respond … Chinese naval power has been developing at an amazing pace; they may seek to accelerate that,” he said.

According to the US Congressional Research Service, the People's Liberation Army Navy overtook the US Navy by size last year, reaching a strength of 360 combat capable ships to America's 297.

“They have nuclear submarine capabilities, anti-submarine warfare capabilities. They may look at departing from the commitment to non-alignment and form their own coalition. Russia may become part of this coalition. The two countries continue to say they are not ready to start a formal military alliance, but that was before the announcement on 16 September,” he said.

Excluding France

“Australia has handled it badly," Prof Beeson said.

"It’s a huge loss of face for [French President Emmanuel] Macron … if the US, and Australia in particular, are serious about making the Indo-Pacific the basis of their strategic view of the world then France could be an important player.

"They have a presence in the Pacific and regard themselves as a serious actor, and they might not be willing to co-operate with the US and Australia if their strategic interests are containing China."

The move could also disrupt Australian efforts to secure a new free-trade deal with the EU, in which France, along with Germany, is a key power broker.

Prof Muraviev said that although France’s veto power in the EU could pose challenges for Australia in the future, the EU would also consider the bigger security picture.

“The EU can’t simply brush France’s concerns and frustrations under the carpet. On the other hand, EU members of Nato understand too well that even though Australia has betrayed the relationship between Paris and Canberra, it has been done with one strategic aim in mind – to deter China.”

Perhaps more perilously for Australian economic interests is the message Aukus sends to China, Prof Beeson said, which is still Australia’s biggest trade partner despite relations souring recently.

“Aukus reinforces every bit of paranoia and every stereotypical view China has of Australia and the US. They trot out this line that Australia is the lapdog or regional deputy of the US, but something like this makes it look like they are on to something."

"It is also worth remembering that the UK was one of the key colonisers of China during its century of shame, and they have long memories.”

“Aukus has the explicit intent of containing China's rise, and what they see as China’s assertive – or aggressive – behaviour in the South China Sea in particular. They are nervous about China being a threat to the status quo, which the US dominates, but China is still Australia’s biggest trading partner."

According to the Australian Bureau of Statistics, China accounts for 40 per cent of Australia's exports. But despite these risks, the prevailing political wind in Australia appears to be one of supporting Washington's Pacific military strategy.

"The current government, and the Labour opposition, seem to believe that standing up to China is sensible policy, even if it has a serious impact on Australia’s economic position.”