"Australia must abandon China myths" - Dean
30 May 2012
Australia must abandon some "wrongheaded myths" about future superpower rivalries if it is to prosper from its economic and political links with China and the United States, according to the Dean of the University of Sydney Business School, Professor Geoffrey Garrett.
In a wide ranging and forward looking address to TEDxSydney on May 26, Professor Garrett predicted a dramatic slowdown in China's economic growth and an ongoing tense but pragmatic relationship between the US and China based on economic interdependence.
This superpower relationship, he said, will place Australian in an economic win-win-win situation.
Professor Garrett, who is also the Chief Executive of the University of Sydney's United States Studies Centre, strongly rejected the myth that Australia would need to "rebalance" its foreign policy away from the US and towards China.
"This view assumes China will soon eclipse the US as the world's most powerful country and that the transition will be bloody," Professor Garrett said. "The problem with this line of thought is that we will not be living in a China dominated world anytime soon but rather one in which China and the US will be twin superpowers."
In what he described as a "G2 World", Professor Garrett said that China and the US want to make money with each other, not war with each other. To do this, he said, they know they will have to live with their radically different world views and manage their tensions over trade, Taiwan and Tibet.
"Symbolism is the best way to understand both the decision to send more marines to Darwin and the truculent Chinese response," Professor Garrett said. "Does anyone really believe rotating 2,500 more marines through northern Australia each year will alter the strategic balance in the South China Sea much less the Taiwan Straits?"
Professor Garrett pointed to the handling of tensions surrounding the blind activist Chen Guangcheng as an example of Beijing and Washington's shared willingness to resolve differences for the sake of mutual long term economic benefit.
Turning to the Chinese economy, Professor Garrett, predicted that it would become the world's largest and then slow to about five per cent annual growth by about 2025.
"Chinese growth must slow because of demography and development," he said. "A maturing China will be transformed from a low cost producer of choice into an enormous middle class consuming nation."
"The US, meanwhile, will remain the global engine for innovation and the global magnet for immigration and there is little reason to believe it won't return to its long term growth trend once today's profound global uncertainty lessens," Professor Garrett said.
In a G2 world, he told his audience, Australia needs only to continue the strategy that has served it so well for decades - broaden and deepen the US alliance while developing stronger economic and cultural ties with China.
With this approach, Professor Garrett said, Australia could position itself as one side of a "win-win-win" economic triangle.
He concluded by highlighting the recent agreement between Australia's Origin Energy and US oil and gas giant, Conoco Phillips, to produce gas in Queensland for Chinese company, Sinopec.
"The Origin-Conoco-Sinopec agreement better captures Australia's G2 world than a war of words over troops in Darwin," he said. "What it tells us is that Australia doesn't have to make invidious choices between security and prosperity - between an America of the past and a China of the future - we can and will have both."
TEDxSydney is an annual forum for 'Ideas worth spreading'. This year, The University of Sydney partnered with TEDxSydney which was held at the CarriageWorks in Sydney's Eveleigh Rail on Saturday 26 May.
Founded in 1984, past TED speakers have included Bill Clinton, Bill Gates, Jane Goodall, Frank Gehry, Sir Richard Branson and Bono.