Oceanic Opportunities

By+Yu+Lintao

Chinese President Xi Jinping paid state visits to three South Pacific countries—Australia， New Zealand and Fiji—from November 16 to 23. During his trip， China and Australia not only concluded bilateral free trade agreement （FTA） talks but also decided to elevate their relationship to a comprehensive strategic partnership. By further deepening mutual trust， Xis first visit to New Zealand and Fiji as Chinese president also heightened bilateral relations.

Lifting ties

The twin upgrades of bilateral cooperation have ushered China-Australia relations into a new era of mutually beneficial interaction， observers said.

“China and Australia established a strategic partnership last year. Just one year later， the two countries have agreed to upgrade bilateral ties to a comprehensive strategic partnership， demonstrating that China-Australia bilateral relations have been continually deepening，” said Ma Zhengang， former President of the China Institute of International Studies （CIIS）.

According to Ma， the comprehensive strategic partnership is the highest-level political relationship China develops with foreign countries； in the future， China and Australias strategic relations will not be limited to economic and cultural fronts. Instead， they will expand to political mutual trust over security issues as well as cooperation on regional and international affairs.

“As a result， the level of mutual trust will rise， actively boosting the development of bilateral practical cooperation，” Ma said.

Besides the progress made in terms of the bilateral strategic partnership， the establishment of the China-Australia FTA will likely provide the people of the two countries with more tangible benefits.

According to the bilateral FTA， Australia will eventually remove tariffs on all goods imported from China， and a vast majority of Australian products will enter China tarifffree. While Chinese people will have access to much cheaper and qualified Australian dairy products， Australian consumers will be able to purchase more high quality and inexpensive Chinese goods.

In addition， the two sides agreed to grant each other the most favored nation status once the FTA takes effect， which will greatly lower the review thresholds for corporate investment and increase market access opportunities， predictability and transparency for such investment. They have also committed themselves to opening up numerous service sectors to one another.

Ma noted that the two economies are highly complementary， suggesting that the FTA should greatly benefit Australias bulk commodity exports such as dairy products， red meat and fruits. Meanwhile， China will harvest a great deal of direct investment and labor market access in Australia.

Over the past decades， China-Australia bilateral intertwinement and interdependence have markedly increased on the economic and trade dimension. China is now Australias largest trading partner， export market and source of imports. Australia， in turn， is Chinas eighth largest trading partner and an important source of the raw resources. More than 20 rounds of negotiations over the past nine years have put the two sides on the same page regarding what they must do to make full use of the complementarity to boost their respective development.

Bob Carr， former Australian Foreign Minister， held that the FTA makes the China-Australia relationship stronger and deeper.

Carr said in an interview with Xinhua News Agency that the China-Australia FTA will be a major boost for Chinese provincial and Australian state governments in attracting infrastructure investment.

“Chinese investment is significant and the[Australian] states are very keen for infrastructure investment. The states are responsible for building roads， railways， ports， and providing safe and secure electricity network， and there are many areas where the Chinese are looking for partnership，” Carr said， adding that Australian farmers will be big winners in the FTA deal.

Professor Kerry Brown， Executive Director of the China Studies Center at the University of Sydney， believes the FTA offers the Australian business circle good opportunities to readjust their trade structure with China.

“The FTA is a powerful symbol that the two countries now have economies that are closer to each other and should serve to make Australians think more deeply about areas where they can now engage economically with China beyond resources. It offers the service and finance sectors in Australia some good opportunities. The Australian business community needs to think much more about what they might be able to do in China，” said Brown in an e-mail interview with Beijing Review.

Meanwhile， Brown said that， as the two countries now have the economic and cultural infrastructures to work more closely with each other， it is the right time to seek deeper engagement.

Maintaining momentum

In a signed article published on the New Zealand Herald before his arrival， Xi wrote that China is ready to move forward hand-in-hand with New Zealand as effective partners for winwin cooperation， working together toward an even better future for bilateral relationship.

New Zealand holds many “firsts” in Chinas diplomacy. For instance， it is the first developed country to reach a bilateral agreement with China for Chinas accession to the WTO in 1997. It also led other devel- oped countries to recognize Chinas market economy status in 2004 and to sign and implement an FTA with China in 2007.

Chen Mingming， former Chinese Ambassador to New Zealand， said that the China-New Zealand FTA has played an important exemplary role for the establishment of the China-Australia FTA.

“In a sense， if there were not the ChinaNew Zealand FTA， there would not be a China-Australia FTA，” Chen was quoted by The Beijing News.

After the completion of the China-New Zealand FTA， China has provided New Zealand with a huge market. Over the past five years， New Zealands dairy and meat product exports to China have increased more than 500 percent， with timber exports rising by 300 percent. The number of exported product categories from New Zealand to China has also increased from dozens to more than 200. In 2013， China replaced Australia to become New Zealands largest trading partner.

In addition to robust economic links， the two have also fostered close cultural and people-to-people exchanges. The bulk of international study abroad students in New Zealand now come from China.

Fiji was the last stop of Xis South Pacific trip. It is the first time a Chinese head of state has visited the Pacific Island country since the two countries established diplomatic relationship in 1975.

Fiji is an important country in the South Pacific and the first in the region to forge diplomatic ties with China.

China-Fiji relations have progressed steadily and demonstrated increasingly positive signs of growth in recent years. The two sides have witnessed continuous growth in trade and investment. China has assisted in the construction of hospitals， houses and hydro-power stations， as well as road renovation in Fiji. Cooperation between the two countries on agricultural projects plays a concrete role in improving the livelihood of the island people.

Huang Yong， Chinese Ambassador to Fiji， told the media that the comprehensive growth of China-Fiji ties has not only brought tangible benefits to the two countries and two peoples， but also helped to ensure peace， stability and development in the South Pacific. President Xis latest trip succeeded pushing bilateral ties to a new level.