Australia, a close ally of the US in the Southern Pacific, has refused the Chinese offer to join hands against tariffs slapped by US President Donald Trump as a fierce trade war rages between Washington and Beijing.
China’s Ambassador Xiao Qian invited Australia to “join hands” with Beijing in “solidarity” after the US president imposed 125% tariffs on its rival.
The ambassador wrote in an op-ed, “The only way to stop the US’s hegemonic and bullying behavior in harvesting the whole world is to strengthen solidarity and collaboration and jointly resist.”
He emphasized, “Under the new circumstances, China stands ready to join hands with Australia and the international community to jointly respond to the changes of the world.”
However, this offer was duly rejected by the Australian Deputy Prime Minister Richard Marles. “I don’t think we’ll be holding China’s hand,” Marles said, responding to the Chinese offer. “We obviously don’t want to see a trade war between China and the US … [but] it’s about pursuing Australia’s national interests, not about making common calls with China.”
These developments come in the wake of a trade war between the US and China after US President Donald Trump imposed 125% tariffs on China. Earlier, in a tit-for-tat move, China had retaliated by raising its tariffs on US imports from 34% to 84%. Angered by the reciprocal tariffs, Trump hiked tariffs on China from 104 % to 125 % on April 9 while announcing a pause on tariffs on other countries that did not retaliate. The other trading partners will have a tariff of 10% for 90 days.
The trade war has triggered fears of a global recession. China is Australia’s biggest trading partner, which means the tariffs on China will automatically hurt Australia.
According to Treasury and RBA models, the Trump tariffs will primarily impact Australia through the “China channel,” which means that unless China takes significant steps to boost its economy and support demand, Australian exports are likely to suffer, ABC News reported.
Despite the threat to its economy, the Australian leadership does not want to pursue a path antithetical to Trump. “Our trade relationship with China is an important one. Trade represents one in four Australian jobs and China is by a long distance our major trading partner,” Australian Prime Minister Anthony Albanese told reporters.
”These trade issues affect 20 percent of the global market. 80 percent of trade does not involve the United States. There are opportunities for Australia and we intend to seize them.”
Instead of joining forces with China, which will antagonize Trump, the Australian leadership is mulling trade diversification. Marles said Australia will prioritize diversifying its trade and developing stronger ties with countries like Indonesia, India, the United Kingdom, and the United Arab Emirates to reduce its reliance on Beijing.
This is hardly surprising. Despite being trade partners, Australia and China remain marred by tensions. The tensions between the two sides started in earnest in 2020 when China placed several trade barriers on a wide range of imports from Canberra as ‘punishment’ for the then Australian Prime Minister Scott Morrison’s calls for an independent inquiry into the origins of COVID-19 in China.
While several of those restrictions have now been lifted, tensions persist, fuelled by China’s expansionist tendencies. For one, China has been steadily advancing into the Southern Pacific Ocean and forging new security ties with Pacific Island Countries (PICs), a region that has been an Australian bastion for decades.
In 2022, China signed a defense cooperation agreement with the Solomon Islands, triggering fears that a Chinese naval base could come up near Australia.
China has made no bones about wanting to expand its influence and take it to far-off seas, including the Australian doorstep. For instance, a Chinese People’s Liberation Army Navy (PLAN) task group conducted two live-fire drills near Australia and New Zealand in February this year without providing adequate notice. Strategically placed in the Indo-Pacific region, Australia has named China the biggest security threat.
Australian officials and the Defense Strategy Review, published in 2023, have flagged China’s aggressive tactics, such as the coercive handling of territorial disputes and the risky interceptions of ships and aircraft operating in international waters and airspace over the South China Sea.
Moreover, Australia happens to be the closest US ally in the South Pacific and is expected to be a party in a potential US-China conflict. While the Australian leadership has not explicitly stated that it would aid Washington against China, the military ties between the two allies are robust, and the areas of cooperation continue to expand.
Deep Military Ties Define US-Australia Ties
The US is arming Australia to deter China, while Canberra is increasing the American military presence in the country. For one, Australia is acquiring several long-range weapons from the United States to enhance its firepower.
Just as it refused to side with China, the US Department of State has authorized the potential sale of new AIM-120C and AIM-120D Advanced Medium-Range Air-to-Air Missiles (AMRAAMs) to Australia under the Foreign Military Sales (FMS) program.
The US Defense Security Cooperation Agency (DSCA) announced on April 9 that the proposed sale has been approved in response to the Australian government’s request to purchase up to 200 AIM-120C-8 AMRAAMs and up to 200 AIM-120D-3 AMRAAMs.
In addition to these missiles, Australia is also buying over 200 Block IV and Block V Tomahawk cruise missiles, which will be equipped on the Hobart-class destroyers and future Navy platforms, including Virginia-class submarines and, subject to feasibility studies, the Hunter-class frigates.
It has also set the ball rolling on the acquisition of hundreds of SM-2 IC and SM-6 long-range weapons for the Navy that can be launched from both land and sea.
Needless to say, the biggest testament to the burgeoning military cooperation between the US and Australia is the AUKUS agreement, which was signed in September 2021 to arm the Royal Australian Navy with nuclear submarines. As part of the agreement, Australia will buy US Virginia-class submarines until it gets its own AUKUS submarine.
Though troubles have been flagged recently, Australia remains committed to the alliance. According to recent reports, the deal has come under scrutiny. Australia must pay US$2 billion by 2025 to help upgrade its submarine shipyards, a timeframe that was not previously publicized. The Trump administration has requested additional financing.
Australia has also made some very big-ticket purchases of US weapons like the HIMARS, Abrams Main Battle Tanks, and F-35 Lightning II aircraft from the US. In a recent development, Air Vice-Marshal Nicholas Hogan, the head of capability for the Royal Australian Air Force (RAAF), also reaffirmed his support for the F-35 Lightning II stealth aircraft amid increased suspicion regarding the platform.
The opposition Coalition frontbencher James Paterson recently promised that if his party wins the election, a new order for 28 additional F-35A fighters will be placed.
On the other hand, the US has increased investment in defense, storage, and fuel facilities in Australia in the last couple of years.
The US has solidified its presence in Darwin as the military bases located in this coastal city in Australia’s Northern Territory could be used as a launch pad for American fighter jets and bombers in the event of a conflict between the US and China.
The US has made mammoth investments, including a massive fuel station at Royal Australian Air Force (RAAF) Base Darwin, which was completed in 2023. This facility is in addition to two more fuel storage tanks built at the base. The US has likely been building these facilities to aid the operation of its warplanes stationed at the Darwin military base.
In addition, each year, northern Australia hosts a six-month rotation of around 2,000 US Marines and American military aircraft under the “enhanced air cooperation agreement” between the two nations. This annual deployment is part of the United States’ effort to shift its strategic focus toward the Indo-Pacific and guarantee that it remains a dominant military force in the region, deterring China.
In August 2024, the US and Australia announced new agreements on basing and building weapons jointly. As per these agreements, the US will get enhanced access to Australia’s northern and western coasts. Additionally, the two sides regularly conduct military drills and have joined hands to conduct several multi-national patrols in the Indo-Pacific, all as part of their joint efforts to deter China.
In a recent development, the Australian Labor Party and the opposition Coalition have pledged to bring back the Port of Darwin (currently under a 99-year lease by a private Chinese company) under Australian ownership, as recently reported by the EurAsian Times.
While all of the above signals the strength of bilateral ties, it is likely just the tip of the iceberg, and the defense cooperation between the US and Australia runs much deeper. Thus, it is safe to say that Australia’s turning down China’s offer is a natural decision, one that keeps it closer to the United States, on which it is dependent for its security.
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