Xi would be deposed if he did a Putin in Taiwan
An interview with China specialist, retired Ambassador Graham Fletcher
I have been dying to interview Graham Fletcher ever since Cheng Lei told me about his remarkable work in helping secure her unlawful imprisonment in China on fake charges during the pandemic.
Fletcher is one of Australia’s most experienced hands when it comes to China. He served three times in Beijing and most recently as Ambassador between 2019 and 2024, when relations with China were at their worst.
He returned to Australia and worked in the Department of Prime Minister & Cabinet on international and security policy before retiring from the bureaucracy last year.
I was delighted to see him enter the debate by authoring a paper for the Sydney-based foreign policy think tank Lowy Institute, on the state of China-Australia relations today.
Below is an edited transcript of our discussion.
Graham Fletcher (GF): At the moment, the China-Australia relationship has recovered to a position of — it’s back on track, essentially. The relationship is functioning again, we’re able to get things done, we’re able to communicate what we have to, trade’s happening.
But compared to what it was before, it’s a bit more realistic, hard-headed. We would have said beforehand that we were hard-headed and realistic, but we’re now certainly very realistic about what’s possible, where the limits are.
I say at one point in the paper that China is determined and is confident, and it’s pushing its own agenda. Well, we’re confident too, because we’ve actually discovered that we’ve got some very good antibodies in our system, which will respond to unwelcome behaviour from China.
And we’ve discovered our own resilience, frankly, and that, China might try and pressure us, but their pressure campaigns didn’t really work and it’s very good that we’ve been able to extricate ourselves from that kind of hole that we were both in and get back to a situation where, we can do things which are good for us, and they do things, it works for both sides, and it’s got to work for both sides to function.
And when you look at what the US is doing and others, we’re kind of all in a similar position. It would be foolish for us to maintain the rage on a misguided sense of principle, not engage with China, and then find that everyone else is doing so.
So, it is what it is. It’s a reality there, all of us in this part of the world have to deal with the challenges that China presents and try to make the best of it.
One throwaway line in there, I say, well, who cares if Australia and North Korea aren’t talking to each other, we can get by. And you could say the same with Russia. Australia’s relationship with Russia is really almost nothing there. So what? It doesn’t matter.
But you can’t do that with China. The government has got to say to the whole Australian community, we are prosecuting our foreign policy for the overall benefit of our country, all of you.
You can’t do that if you’re just focusing on one set of issues and then ignoring the rest. You’ve got to manage all of them together, jointly, coherently, and that’s quite hard, because China’s a lot of upside, a lot of downside. There’s good and bad there, and managing it successfully has always been a challenge.
Latika M Bourke (LMB): You use this phrase, ‘back on track.’ Would you say that the circumnavigation of Australia and the ballistic missile test are evidence of that?
GF: Well, that’s China’s strategic behaviour. That’s not the Australia-China relationship.
LMB: But that’s new; circumnavigating Australia is directly aimed at Australia.
GF: Oh, yeah, but you’ve got to distinguish what I’m talking about, which is that the government-to-relationship is functioning again, so that is in working order now. It was dysfunctional, now it’s functional.
China, as a strategic actor, is disrupting the order, so to speak, or the status quo. And one example of that is circumnavigating Australia. That was a message to us, perhaps, but also they’re doing it more broadly everywhere; they’re doing exercises with Russia in the Baltic, which is a thing for Europe to take account of.
And the ballistic missile test, they’re just reminding us — well, to a certain extent, weapons programs need testing from time to time anyway, so it was a question of sooner or later it had to happen.
But yeah, they are expanding, modernising their ICBM capability, and they want everyone to know that.
They probably didn’t recognise exactly what reaction it would generate in the Pacific. They could have tested it in the Indian Ocean, for instance, but they chose to do it in the Pacific. Maybe it just suited them; it is closer in a way to where their ships come from.
But yeah, China’s not changed its behaviour in any meaningful way, and we don’t pretend that it has. It is still a destabilising force in the world, and particularly in our region, as it is finding its place. It sees itself on the way up, and they have certain objectives they think they’re going to be able to reach, where China will again be where it belongs, back at the top table of world affairs.
LMB: But does that mean that their increasingly destabilising behaviour tests our stabilisation of the bilateral relationship?
GF: Well, yeah, it does. China’s strategic behaviour is a test of links with China, of course.
LMB: How do you see us balancing it at the moment?
GF: Well, we try and do both at once, meaning we’re working on our own deterrence capability with AUKUS and with our defence modernisation program, we work with partners, Japan, India, the ASEAN countries, and Korea, to strengthen our partnerships, but there’s a lot of moving parts all at once in this space.
LMB: So you make a lot of reference to this in the paper, these demands in Australia, or there are some parts of the community in Australia that think that since Labor has come into power, it has been too slow to call out some of these acts directly with Beijing.
What is your assessment of this? Do you think that the government is doing enough to signal publicly, both to the Australian public, that we’re not okay with some of these things that China does, while at the same time balancing, obviously, this delicate position we have in how we communicate to China itself?
GF: I think we’re pretty clear in terms of our views on the strategic issues. The kind of classic reference points that I point to are, so what does Australia say with the United States when we have our annual defence and foreign ministers meetings called AUSMIN
What do we say with Japan? What do we say with Korea? What do we say with the UK? And if you look back from 2015 through to now, there’s been a steady strengthening of what we say.
But, you can say all you like, words are cheap, frankly, and they’re not going to — China is not going to say, oh, sorry, we didn’t realise you didn’t like that, we’ll stop it. I mean, of course, they’ve got their own plans,
But by the same token, if you overdo the rhetoric, you then destroy the ability to function in other parts of the relationship. And that’s why I talk about things becoming counterproductive.
It doesn’t make sense for the government to pursue the national security interests with China in such a way that it stops us from doing other things. We want to do both at the same time.
Now, of course, that’s difficult to kind of judge where exactly are those limits. And I think where we are at the moment is a kind of sweet spot, where we’re able to successfully prosecute our defensive interests against China, and also the positive interests.
Now, you could go too far on the positive side and just ignore everything that China’s doing, but we don’t do that.
If you talk to DFAT, they’ll never answer the question honestly, but if you said to them how often does China protest what we’re saying and doing in terms of strategic matters? I reckon it’s every week to 10 days.
Because every week to 10 days, we will say something, either in the UN or in a bilateral discussion with another government, like a communique, the foreign minister has a press release on one thing or another, and that’ll press a button in Beijing where they say, hang on, because they have this thing that they can’t let anything be said that they disagree with and have it go unanswered. They have to formally take you to task over it.
Certainly, when I was in Beijing, it was every week or so, we would have a formal representation from the foreign ministry saying You have said this so and so, and that’s not correct, and you need to smarten up.
LMB: And what did you say back?
GF: Well, I would say, look, we’re telling you what our positions are and whether it’s to do with something in the South Pacific or elsewhere, it’s just an enunciation of government policy.
And we would have reasonably robust discussions about those issues on a regular basis, and that’s diplomacy, that’s what you do.
And they would do it in Beijing and in Canberra, and likewise, when we need to make a representation to them, we do it to the embassy in Canberra, and also to the foreign ministry in Beijing. You kind of use both barrels so that they very clearly hear the message, and there’s no confusion about what we’re saying.
LMB: So we’re at the sweet spot, you say, but in your paper, you say that China would actually like to do a bit more with us, but we’re a bit disinterested. What would China like to do with us?
GF: There are a whole lot of things. I think their ambassador listed several things, electric vehicles, they’d like to do AI, infrastructure, fast trains in Australia, you name it. They want to have more investment in critical minerals. There’s a range of areas where they want to expand, which, frankly, for us, are either risky or just not worth the effort, because it’s just complicated.
So, we’ve got a traditional relationship based on commodities of things that we export to them, and there’s a certain degree of investment in gas, iron ore and so forth.
They’ve got quite a bit of rare earths and critical minerals interests already. My sense is that Canberra doesn’t want to expand that.
There have been a couple of decisions of the Treasurer in relation to Foreign Investment Review Board, which have said no to further expansion of China’s interests in that particular sector, and that’s because China’s already got 80 per cent of the world’s production of these things. And there’s no reason why we should make that 80 per cent into a 90 per cent, and there’s every reason for us to develop non-China supply chains for those key materials, because China’s showing its willingness to weaponise its ability to control the flow of those things as is.
So if they got a greater stranglehold on the supply chains, then it would be even more risky from our perspective.
LMB: You say in the paper that you think consumption in China has peaked.
GF: Of coal and steel,
LMB: Yes, coal and steel, exactly. What saved us during economic coercion was the fact that they’re highly dependent on things that they need from us.
If there is a point in time where coal and steel have peaked in their use, does that make us vulnerable in the longer medium term, and is that something that we need to start factoring into how we deal with our bilateral relationship?
GF: Not really. That sentence is to justify the judgment in the previous sentence that says that the growth of the past decade isn’t going to be repeated. We had very substantial growth from 2015 through to now, 125%, so basically more than doubled. That’s not going to happen again because Chinese steel production has plateaued, and coal usage in China is starting to fall.
But Chinese coal consumption is 93 per cent local, only 7 per cent is imported, so 7 per cent is nothing compared to 100 per cent. They could halve their domestic production of coal and quadruple their imports from places like Australia and still not regard it as a big change.
Now, of course, that’s not going to happen, but you’re talking very large numbers and very small proportions of very large numbers.
So China gets most of its iron ore from Australia. If Australia somehow halved its production of iron ore, China could not meet the shortfall. There is just not enough iron ore being purchased around the world.
LMB: Not even if Simandou comes online?
GF: Simandou is 150 million tons. When it’s fully in production, we’ve got 700 million or something in terms of our production.
LMB: Okay
GF: Now, ours is lower quality, on average, compared to Simandou’s higher quality, but still. Eventually, if Chinese steel production halves over the next two or three decades, they won’t need Australian iron ore, but they’re not silly enough to put all their eggs in everyone else’s baskets.
Their ideal is probably to have 30 per cent from Australia, 30 per cent from Brazil and 30 per cent from everywhere else. The trouble is that at the moment they’ve got about 60 per cent from Australia, which is, from their perspective, much too high.
Our stuff happens to be very good in terms of its quality, reliability, et cetera, and consistency, and also quite close, so it’s cheaper to get from Australia, so we’re in a good position for that.
But yeah, I mean, broadly speaking, we know nothing you do with China is guaranteed forever, and they could well, for political reasons, shut things off in the future, but I don’t think they plan to.
I think they learned their lesson that it actually makes them look silly if they try to pressure us in that way, because they really expanded the number of products and everything that they targeted was quite unusual with other countries like Korea and whatnot, they’d always been targeted in their economic measures. With us, it was a broader range, but even then, minimal economic impact on us.
AUKUS
LMB: On AUKUS, what is your understanding of how much that seriously worries the Chinese Communist Party (CCP)?
GF: Look, I don’t know whether the People’s Liberation Army has had to rewrite anything as a result. If they’re looking at the United States with, I don’t know how many dozen nuclear-powered submarines they’ve got, an extra half a dozen in the southern hemisphere with Australia, that’s something I have to think about, but I doubt that in a military sense, it’s a game changer.
But I’m not an expert here. But politically, they don’t like it, they hate… because it means that the Australia-United States alliance is kind of deeper than ever, and entrenched for a long, long time.
Whereas they would have hoped, and perhaps still hope, that one day, either the US will give up and go away, or Australia will, as they see it, come to our senses and give up on it, and AUKUS just makes that very less likely.
Plus, it’s not so much that we’ve got a capability, it’s that the US is able to use Australian geography, and the UK as well, as another point of R&R and maintenance, which just gives the US Navy more options.
LMB: So the base is actually the key — HMAS Stirling.
GF: Well, it’s the fact that UK and US submarines can come through Australia and get refitted and repaired. It gives the US more options as it’s operating globally, Australia is now part of the mix in that, and that no doubt is a factor, but I’m not a strategic planner; I’m just kind of guessing in that respect.
LMB: No, I’m asking you because when you were there, AUKUS was happening. So obviously, you would have detected and had your own analysis of how much you think that that was really a critical factor for them or not.
GF: China was vigorously, and they still are, as far as I know, trying to stop AUKUS through the International Atomic Energy Agency, through regional opposition, through, you name it.
They were trying to get all of Southeast Asia up in arms about it — how dare you, how dare Australia get this capability, it’s proliferation, it’s step one of getting to nuclear weapons, blah, blah, blah.
And that’s very obvious, and in Vienna at the IAEA, they’re always trying to create trouble there, but they never mentioned it to us directly in Beijing as a problem.
LMB: Really?
GF: No, it was never a ‘we don’t like’
LMB: Really? I’m stunned to learn this.
GF: No, on the first day, when it was announced, I happened to be at a social gathering, or an event the New Zealanders put on, where the relevant person from the Foreign Ministry was there, and he kind of complained about it, but just as a kind of a… but they never formally said Chinese government believes Australia you have made a mistake, you need to stop this, or whatever.
Because they knew it wouldn’t work and it would make them look silly when we say, it’s none of your business, frankly, what kind of submarines we operate.
We talk about China’s military modernisation being opaque and not explained, which is correct, but we don’t say you ought not to have 20 submarines or 3 aircraft carriers, or whatever.
It’s interesting, it was never raised as a bilateral problem between Beijing and Canberra, at least not while I was there; I doubt that it has since either.
LMB: I’m stunned to learn that. Are you surprised by that, or is that my own ignorance?
GF: No, because they recognise when it’s not worth wasting their breath on something. Just as we don’t go to China and say, ‘We really hate the way you run your country, you should change or something.’ There are some things you just think that’s a given. That’s a reality; we just have to deal with that.
LMB: You don’t think Taiwan is imminent?
GF: No.
LMB: People like Kevin Rudd think 2028 is the year of potential, the window really opening wide then. What’s your assessment?
GF: Well, I’m pretty sure China’s not ready. Secondly, the use of force is not their preferred course of action. That’s the last resort after everything else has failed.
LMB: But for the premise of my question, I’m including, which I think is the more likely scenario, blockade. So moving on Taiwan from the remit of blockade to an invasion.
GF: No, they wouldn’t start a blockade unless they were prepared to follow through with an invasion.
LMB: Oh, really?
GF: Because what happens if the blockade doesn’t work?
LMB: Mmm, quite.
GF: So in my mind, Xi Jinping is only 73, only 73, he probably feels he’s got another 10 to 15, possibly even 20 years at the top.
I would be worried if he were in his mid-80s, meaning, I think he might feel that the pressure of time is getting to him.
It’s a very difficult thing to mount an invasion across that Strait and I don’t think the military people in our system think that they think that they can do it.
Once they get to a position where they think yes we could then that makes things a bit more dicey.
LMB: But isn’t Xi purging people who are telling him we’re not ready? Isn’t that a sign?
GF: Well, no one knows why those people were purged.
There’s one theory that perhaps they were telling him unwelcome news that he didn’t want to hear. But as far as I know, there’s no information to support that; it’s just a hypothesis.
LMB: And what about the Trump factor?
GF: I think Trump makes something less likely than more.
LMB: Really?
GF: Yeah.
LMB: Why? Madman theory?
GF: Because he’s so unpredictable.
LMB: Yeah, ok.
GF: Yeah. Possibly he might give it to them. Not that he can.
It is such a high-risk thing for Xi Jinping that if he attempted it and it didn’t work quickly. I think he’d be gone. I don’t think his colleagues would allow him to sit there like Putin does presiding over a frozen conflict or something that hasn’t worked.
So, it’s such a big gamble, I can’t see him attempting it until absolutely dead certain, and it’s necessary because everything else has failed, everything else hasn’t failed.
LMB: Yeah, we’ve still got Presidential elections in Taiwan.
GF: I just think there’s too much heated rhetoric about it’s about to happen, and it’s not. Sure, they’re doing lots of stuff, pressuring exercises, you name it, but I don’t think there’s a timeline in Beijing that they’re working towards.
LMB: And final question. What does China get wrong about Australia, and what does Australia get wrong about China?
GF: I think China often fails to look at us as we are on our own terms. It can’t help but view us through a US prism, and so when we respond in certain ways and say certain things, they can’t help but say, oh, you’re doing this not because you want to but because you’re being forced to by the Americans.
I once said to them, if somehow the US were removed from the equation by a meteorite that just landed and destroyed the United States, I don’t think Australia’s policy towards China would alter all that much.
And of course, I was just being silly in a way, but I mean, the main point is that we’re not doing this because we’re being told to, we’re doing it because it’s in our interest to do so and our view of our interest is we care about human rights, we care about Xinjiang, we care about a whole lot of things, and we care about the South China Sea, too and that’s why we’re saying what we’re saying.
They have always failed really to understand us as we are, and partly their embassy sometimes just talks to the people that agree with them, so I don’t think they get out and about enough, or they haven’t previously.
The current ambassador, who’s just left, he’s been a lot better, I think, and quite courageous in going to the press club and giving press conferences and so forth, whereas his predecessor, I don’t think, was that active, and he was a bit nervous, and his English wasn’t quite as good either.
What we get wrong about China, it’s easy to view China just in a very two-dimensional way. And it’s challenging to kind of see it warts and all and the upside and the downside, and make the most of that.
Years ago, when I was in the embassy, I had to keep reminding starry-eyed visitors from Australia that this is still a Leninist dictatorship.
And people just didn’t see that, and they kind of just believed all the stuff they were told. Now the problem is they don’t believe anything, and they believe only the darkest things.
LMB: Interesting.
GF: Now the dark things are true, but there are also shades of grey as well. It’s not all black. It would be foolish for Australia just to treat China as if it’s all too hard, let’s just try to wall it off and do other things, because that’s not sensible for Australia.
And at the end of the day, almost everyone else is trying to do both as well so why not join them? Otherwise, we’re depriving ourselves of market opportunities and good migrants, good students, all the good things.
There are advantages of having this relationship to the Australian community.
I wrote a report from this interview for The Nightly, which you can read here.