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Addressing the elephant in the room: The national security and economic overlap

Australia is consistently told that as a nation we are torn between our economic relationship with China and the long-standing strategic partnership with the US, placing the country at the epicentre of a great power rivalry – but what if it didn’t have to be that way?

Since the nation's earliest days, both Australia's economic and strategic planning has been intrinsically defined and impacted by a number of different, yet interconnected and increasingly complex factors, namely:

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  • The benevolence and continuing stability of its primary strategic partner;
  • The geographic isolation of the continent, highlighted by the ‘tyranny of distance’;
  • A relatively small population in comparison with its neighbours; and
  • Increasingly, the geo-political, economic and strategic ambition and capabilities of Australia’s Indo-Pacific Asian neighbours.

Australia's earliest economic and strategic relationship with the British Empire established a foundation of dependence that would characterise all of the nation's future economic, defence and national security relationships both in the Indo-Pacific and the wider world. As British power slowly declined following the First World War and the US emerged as the pre-eminent economic, political and strategic power during the Second World War – Australia became dependent on 'Pax Americana' or the American Peace. 

The end of the Second World War and the creation of the post-war economic and strategic order including the establishment of the Bretton Woods Conference, the International Monetary Fund and the United Nations paved the way towards economic liberalisation and laid the foundation for the late-20th and early 21st century phenomenon of globalisation. 

While the collapse of the Soviet Union and the end of the Cold War cemented America's position as the pre-eminent world power – this period was relatively short lived as costly engagements in Afghanistan and Iraq, peace-keeping interventions in southern Europe and enduring global security responsibilities have drained American 'blood' and 'treasure' – eroding the domestic political, economic and strategic resolve and capacity of the US to unilaterally counter the rise of totalitarian regimes and peer competitors in both China and Russia.

For Australia, the economic emergence of the Indo-Pacific has presented the opportunity to re-write the nation's economic narrative, leveraging areas of natural competitive advantage, supporting the industrial reset with the birth of the fourth industrial revolution. Economic diversity and competitiveness is an essential component of enduring and sustainable national security. 

However, Australia seems to have focused the dichotomy of its strategic security entirely on the US and its economic focus has been placed largely on supporting the industrialisation and economic development of China following its opening to the West in the mid-to-late 1980s – thus setting the scene for Australia's current economic, political and strategic conundrum. 

Australia in the Asian Century – Embracing the opportunity

Undeniably China is an immense economic, political and strategic power – with a voracious appetite driven by an immense population and the nation positioning itself as the manufacturing hub of the world – however, beyond the 1.4 billion people, Indo-Pacific Asia is home to approximately 2.5 billion individuals each part of the largest economic and industrial transformation in human history. 

While successive Australian governments of both persuasion have sought to expand Australia's integration and participation in the economic miracle that is the rise of the Indo-Pacific – China has continued to dominate the nation's economic narrative from the housing sector to agriculture and resources and energy – often to the detriment of relationships with regional nations that approach Beijing with a degree of caution. 

Importantly, as Australia's traditional strategic benefactors continue to face decline and comparatively capable peer competitors – the nation's economic, political and strategic capability are intrinsically linked to the enduring security, stability and prosperity in an increasingly unpredictable region. This approach fails to recognise the precarious position Australia now finds itself in, however it does identify key areas for the nation's political and strategic leaders to focus on if Australia is to establish a truly independent strategic capacity – this focuses largely on:

  • Australia's continuing economic prosperity and stability and the role the economy plays in supporting defence capability;
  • The economic, political and strategic intentions of Australia's Indo-Pacific neighbours; and
  • The rapidly evolving technology-heavy nature of contemporary warfare.

As a nation, Australia is at a precipice and both the Australian public and the nation's political and strategic leaders need to decide what they want the nation to be – do they want the nation to become an economic, political and strategic backwater caught between two competing great empires and a growing cluster of periphery great powers? Or does Australia "have a crack" and actively establish itself as a regional great power with all the benefits that entails? Because the window of opportunity is closing. 

Let us know your thoughts 

The nation is defined by its relationship with the region, with access to the growing economies and to strategic sea-lines-of-communication supporting over 90 per cent of global trade, a result of the cost effective and reliable nature of sea transport. Indo-Pacific Asia is at the epicentre of the global maritime trade, with about US$5 trillion worth of trade flowing through the South China Sea and the strategic waterways and choke points of south-east Asia annually.

For Australia, a nation defined by its relationship with traditionally larger, yet economically weaker regional neighbours, the growing economic prosperity of the region and corresponding arms build up, combined with ancient and more recent enmities, competing geo-political, economic and strategic interests, places the nation at the centre of the 21st century's 'great game'. 

Get involved with the discussion and let us know your thoughts on Australia's future role and position in the Indo-Pacific and what you would like to see from Australia's political leaders in terms of defining the nation's primary area of responsibility in the comments section below, or get in touch with This email address is being protected from spambots. You need JavaScript enabled to view it. or at This email address is being protected from spambots. You need JavaScript enabled to view it..      

Addressing the elephant in the room: The national security and economic overlap
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