German, Swedish subs better for Australian needs

New German, Swedish subs offer alternatives to Taiwan’s Indigenous Submarine Program and Australia’s nuclear ones under AUKUS

Last month Germany and Sweden, two world leaders in conventional submarine design, unveiled three models that could prove to be better strategic choices than Taiwan’s Indigenous Defense Submarine program and Australia’s plan to acquire nuclear-powered submarines under its AUKUS alliance. 

Germany’s ThyssenKrupp Maritime Systems (TKMS) in cooperation with Fincantieri of Italy started construction of the U212 Near Future Submarine (NFS) for the Italian Navy. The first U212 NFS is scheduled to be launched in 2026, with its acceptance into the Italian Navy in 2027. Work on the second unit is scheduled to start in 2029. 

The U212 NFS is a design evolution of the U212A, which first entered Italian Navy service in 2006. At present, the Italian Navy operates four U212A units. Compared with the U212A, the U212 NFS is 1.2 meters longer, has enhanced hydrodynamics and silence in a 59-meter hull, and surface displacement of 1,600 tons.

Designed to operate in tropical waters

The new class is also designed to operate in tropical waters, meaning that it is optimized for operations in the warmer southern and eastern parts of the Mediterranean off North Africa and Turkey. This also means that the design could be sold to tropical climate clients such as Taiwan and Indonesia.

The first two boats of the U212 NFS use the same Siemens hydrogen fuel cell air-independent propulsion (AIP) technology from their U212A predecessors, but introduce lithium-iron-phosphate batteries for its new energy storage and management system, which is billed to be a “game-changer” in underwater warfare. Fincantieri is also developing a new type of AIP system for the third U212 NFS.  

In terms of sensors, the U212 NFS also features a new sail mast design which can accommodate seven electrical masts with one extra space for an optional mast, allowing for future development of the class as a fully electric submarine. 

A fully electric submarine such as the SMX31E New Full Electric Concept completely eliminates any need to surface during operations, meaning it can stay submerged as long as today’s nuclear submarines, which are only limited by crew endurance and supplies.

Current AIP technologies significantly minimize but do not eliminate the need for conventional submarines to periodically surface to run their diesel engines to charge their batteries. 

The Italian Todaro class U212A submarine. Photo: Fincantieri

Other sensors include six non-penetrating electrically hoisted masts and the new generation optical penetrating attack periscope, all provided by L3Harris, low probability of intercept radar by GEM Elettronica, Link 11/16 datalinks from Leonardo and a digital sonar suite by ELAC Sonar. 

Rated to be cyber-secure

Compared with the U212A, the U212 NFS features more Italian-made technology, such as an integrated platform control system (IPCS) provided by Fincantieri Seastema, steering and diving control system by Avio Aero, and combat management system (CMS) by Leonardo.

These systems are rated to be cyber-secure by the Organization for Joint Armament Cooperation (OCCAR), making the U212 NFS the second cyber-secure design by Fincantieri after the Thaon di Revel class offshore patrol vessel (OPV).

The class is designed with open architecture in mind, enabling easy software upgrades such as third-party software, remote computing, extensive acoustic processing know-how and submarine mission-specific applications. 

The Leonardo Black Shark Advanced (BSA) torpedo is projected to be the main armament of the U212 NFS, with the class also designed to deploy long-range cruise missiles. The U212 NFS also retains the special forces support capability of the U212A and can operate alongside unmanned underwater vehicles (UUVs), which extends the surveillance capability of the class. 

Germany and Israel signed a deal for three Dakar0-class submarines from TKMS. These boats are intended to replace three of Israel’s older Dolphin class boats which entered service in the 1990s.

The deal envisions that the first of these new boats would be delivered to Israel in 2027, and includes provisions for the creation of a submarine training simulator in Israel and supply of spare parts. 

While Israel keeps the technical details of its new submarines classified, these new boats are said to be significantly more capable than the preceding Dolphin boats. The boats are said to be armed with 16 multipurpose torpedo tubes that can fire torpedoes, Turbo Popeye cruise missiles and even manned swimmer delivery systems, submersibles designed to stealthily insert special forces teams for covert underwater or amphibious operations.

Possibility of a vertical launch systems (VLS)?

Concept art of the Dakar class released by TKMS shows a much-enlarged sail, which has led to different speculation about the design’s capabilities. Speculations abound that this distinctive feature could be used to house vertical launch systems (VLS) for nuclear-tipped cruise or ballistic missiles. (Israel, of course, is tight-lipped about its alleged nuclear weapons program.) 

In comparison, South Korea’s Chang Bogo III submarine, which is based on the German U214 design, is armed with six VLS launchers for the Hyunmoo-2B ballistic missile. It is the first conventionally powered AIP submarine that is armed with such.

Sweden has also begun the construction of its A26 Blekinge class submarines. It is a follow-on design to Sweden’s Gotland boats, whose stealth capabilities were made famous in 2005 by sinking the USS Ronald Reagan aircraft carrier during naval exercises.

The Swedish Navy has ordered two units, the HSwMS Blekinge and HSwMS Skåne, with the aft section of one boat already put in place. 

The class is built around Saab’s Ghost technology, which stands for Genuine Holistic Stealth. Ghost is a family of technologies meant to reduce the Blekinge boats’ detectable signatures.

Some of these technologies include rubberized mounts and baffles inside the submarine to reduce detectable machinery and crew noise, and careful design of all interior surfaces to minimize noise such as specific airflow speeds in air ducts, minimum bending radius on cables and pipes and the design of outboard holes and cavities.

In addition, the Blekinge class uses a new hull and fin shape to reduce hydrodynamic noise, and the boats’ mast has a unique shape to minimize radar signature. 

Extended operation time

The class features an improved version of the Stirling AIP engine fitted in the Gotland class, which is 30% smaller, yet delivers more power. The Stirling AIP engine works by heating and cooling gases in its cylinders to force pistons up and down.

In the case of the Gotland and Blekinge boats, liquid oxygen and diesel are used to heat the engine, while cold seawater is used for cooling. This technology allows the class to operate for an extended time without surfacing to recharge its batteries by running its diesel engines.  

A unique feature of the Blekinge boats is the Multi Mission Portal, which allows the launch and retrieval of diverse mission payloads, such as special forces or UUVs to extend the boats’ sensor range, which makes the class a potent underwater intelligence-gathering platform. 

Moreover, Sweden also offers the Oceanic Extended Range (XR) submarines, which are designed for navies whose capability requirements include extended missions or long-distance operations.

Notably, the Australian Collins-class was built according to this design philosophy. The Collins boats were built between 1993 to 2001, with Saab working alongside the Australian Submarine Corporation (ASC), providing technology transfer for design and construction using an advanced modular method. 

Offering more sensible alternatives to Australia and Taiwan

These new submarine designs may satisfy the submarine capability requirements of both Taiwan and Australia, offering more sensible alternatives considering the tactical, operational, strategic and political challenges they face in their respective submarine programs. 

In the case of Taiwan, it has a significant shipbuilding industry but has limited experience in building warships, and no experience in building submarines.

While countries such as Australia, Canada, India, Spain, the UK and the US are assisting Taiwan in building its own conventional submarines, this is not a guarantee of success. For instance, Australia’s Collins boats were built from the Saab Gotland class, and Australia received considerable technical assistance from Sweden and the US in this project.

However, the Collins class turned out to be plagued with various problems, which forced Australia to seek replacements.  

It may be more rational for Taiwan to harness its strengths, such as AI, software, semiconductors, electronics and the production of asymmetric weapons, which it can realistically manufacture such as torpedoes, naval mines and cruise missiles, rather than take huge risks by building its own submarines.

Also, should Taiwan persist in acquiring submarines, these subsystems can be integrated into an established, open-architecture submarine design suited for tropical operations. 

An Open Architecture design

Thus, the U212 NFS or a derivative of the class makes sense for Taiwan’s submarine capability requirements. It is an open-architecture design, as shown by the integration of Italian and US subsystems into a German hull, and is designed for tropical operations as well.

As such, Taiwanese subsystems and weapons can be fitted into this already established design. Such an arrangement fulfills Taiwan’s capability requirements for submarines and harnesses its stronger strategic sectors.  

Australia may have made a mistake in the first place in disqualifying TKMS in favor of DCNS from France, as the U214 class from TKMS has capabilities that far exceed those of the Collins class. Further, TKMS offered Australia the U216, which is a scaled-up version of the U214 built to Australian capability requirements. 

Australia initially chose to settle on the DCNS Shortfin Barracuda as a replacement for its Collins boats.

However, the deal with DCNS ran into several problems, such as finding a sensible rationale to justify retrofitting a conventional propulsion system to a hull designed for nuclear propulsion, the incompatibility of US combat systems in a French-designed hull, long development time leading to obsolescence on delivery, the failure of DCNS to invest enough in Australian suppliers and labor and cost overruns.

These factors may have led Australia to drop its deal with DCNS and make a bold move to acquire nuclear submarines with technical assistance from the US and UK under AUKUS. 

Doubts about Australia’s plan to acquire nuclear submarines

It is highly likely that Australia’s plan to acquire nuclear submarines under AUKUS will not materialize, as political considerations regarding maintaining command and control should Australia lease a US Virginia class nuclear boat, vague terms in technology, cost and labor sharing within AUKUS, opposition to nuclear power in Australia and its lack of infrastructure to support nuclear submarines play out against its plan.

That said, Australia may have compounded its mistakes in its deal with DCNS by picking an equally unfeasible solution with AUKUS for its submarine capability requirements.  

In addition, should Australia choose to lease nuclear submarines from the US, it would not be until the 2030s when an aging US nuclear boat would be available for lease, and only in the 2040s would Australian nuclear boats have any strategic effect.

This leaves a huge capability gap between the planned obsolescence of Australia’s Collins boats in 2026, and before its planned nuclear submarines become fully operational in the 2040s.

By then, the geopolitical situation and China’s naval capabilities may have vastly changed. Australia’s only feasible choice to maintain its underwater warfare capabilities is to acquire conventional submarines to fill this capability gap. 

However, with the capabilities of today’s conventional submarines approaching those of their nuclear counterparts, perhaps Australia’s quest for nuclear submarines was an unnecessary venture in the first place. 

Considering Australia’s bad experiences with its Saab-built Collins boats and its deal with DCNS, it may well do for it to revisit talks with TKMS to acquire new conventional submarines that fulfill its capability requirements. 

The AUKUS preparing a nuclear war to sustain Taiwan

The official reactions to the announcement of the Australian-British-US pact (AUKUS) are only about the termination of the Australian-French arms contract. As terrible as this is for the shipyards, it is only a collateral consequence of a reversal of alliances aimed at preparing for a war against China

by Thierry Meyssan

The announcement of the Australian-British-US (A-UK-US) pact was like an earthquake in the Indo-Pacific region.

There is no doubt that Washington is preparing for a long-term military confrontation with China.

Until now, the Western deployment to contain China politically and militarily has involved the United States and the United Kingdom as well as France and Germany. Today, the Europeans are left out. And tomorrow the area will be controlled by the Quad+ (US and UK, plus Australia, India and Japan). Washington is preparing a war in one or two decades.

France and Germany have not been consulted on this strategy. Nor even warned of its public announcement! However, some other countries had been warned, such as Indonesia.

It is logical that London and Washington should rely on Camberra rather than Paris. Australia is a member of the “Five Eyes” with which France is just associated. The entry into the game of Japan and especially India puts an end to a long period of uncertainty. More troubling is the role assigned to Germany. Germans could join the “Five Eyes”, but not the Quad. Meaning – spying on telecommunications, but not military action.

Alliances shaken up

The A-NZ-US, which linked Australia, New Zealand and the United States, has not been in operation since 1985. It has been definitively buried. New Zealand had affirmed its policy of nuclear disarmament and consequently refused entry to its ports to nuclear-armed or nuclear-powered ships. Since the Pentagon refuses to reveal these “details”, no US warship has entered the country. Future Australian submarines will also be banned.

For the moment, the European Union has not reacted. Commission President Ursula von der Leyen, who was giving a state of the Union address on the same day the AUKUS pact was announced, is paralyzed. She was talking about her new strategy in the Indo-Pacific area! All while the Brexit Brits were pulling the rug out from under her. Not only is the European Union not a military power, but those of its members who are, will no longer have a say.

NATO is silent. It had ambitions to expand in the Indo-Pacific and understands that it will not be part of the game.

ASEAN has not reacted either, but the Indonesians who host its general secretariat have already expressed their disappointment. The Association of Southeast Asian Nations was conceived during the Cold War like ANZUS or the EU to contain the communist bloc. However it evolved afterwards. Unlike the EU, which has become a supra-national bureaucracy, ASEAN, influenced by the ideology of the Non-Aligned Movement. It aspires to form a vast free trade area that includes China. Without delay, many Indonesian intellectuals have denounced the torpedoing of this dream of peace by the AUKUS.

Beijing is offering economic exchanges to all, while Washington is offering war

China and Russia, the main enemies designated by the Anglo-Saxons, have not yet reacted. Unlike the West, they never communicate about their intentions. But they communicate about the decisions they have already taken and implemented. Speaking for itself, China has expressed indignation at the Anglo-Saxon mentality of forming the broadest and most powerful alliances possible without regard to the intricacies of each player. This is not a communication trick: the Chinese consider everyone as an equal with their own particularities. The day after the AUKS announcement, China formally applied to join the Comprehensive and Progressive Agreement on Trans-Pacific Partnership (CPTPP). It is the successor organization to President Obama’s proposed Trans-Pacific Partnership. The coincidence of the two events is officially purely fortuitious. In practice, Beijing is offering economic exchanges to all, while Washington is offering war.

The nuclear Spectre

Until now, and probably still today, the United States considers that having nuclear-powered ships opens the way quickly to the construction of atomic bombs. This is why it has only offered nuclear propulsion technology to its British ally. Therefore – and whatever the Australians say – building nuclear-powered submarines prepares Australia for entry into the club of atomic powers. The war against China will be a nuclear war!

From this point of view, Japan’s entry into the Quad after the traumas of Hiroshima and Nagasaki is an achievement.

Until now, only the five permanent members of the United Nations Security Council had nuclear-powered submarines. India has become the sixth and Australia is expected to be the seventh.

Since the United States can no longer maintain its rhetoric of dual-use nuclear technology, it can no longer claim that Iranian nuclear research is for military purposes. This should pave the way for open cooperation between Washington and Tehran, which Israel immediately anticipated.

THE downgrading of the Europeans

The first loser in this new architecture is France. It has lost its status as a global power. It still retains its permanent seat on the United Nations Security Council.

The decline of Paris was foreseeable since its armies were placed under U.S. command within NATO’s Integrated Command in 2009. Today, they are no longer able to defend the entire French territory. Instead they send expeditionary forces to defend US interests in Africa. Indeed, the United States has still not managed to deploy AfriCom on the black continent. It uses French ground troops, which it supports with its air surveillance system.

Paris reacted… by canceling a gala event at its embassy in the United States. The Quai d’Orsay asked the State Department for urgent explanations in the hours preceding the AUKUS announcement. In the end, it considered that Australia had knowingly hidden this project from it, which was instigated by the United States. He therefore recalled his ambassadors in Canberra and Washington. France decided to communicate about the contract of the century cancelled by the Australians. This $90 billion agreement is not much compared to what is at stake and what it has lost.

Paris is all the more stunned because it had thought it had established a privileged relationship with London. Secret negotiations were under way to move the base of the British nuclear-powered submarines (Trident) to France in the event of Scotland’s secession from the United Kingdom.

France can take comfort in the fact that its downgrading is taking place in the context of the more general downgrading of all Europeans. The fact that Germany may eventually fare less badly is incidental. Berlin is only allowed to be an economic power and never since the Second World War to be a global political power.

French presence in Indo-Pacific region

France is not only a European metropolis. It is also a constellation of territories all over the world that gives it the second largest maritime domain in the world (after the United States). In the Indo-Pacific region, it has the departments of Reunion and Mayotte, the communities of New Caledonia and French Polynesia, the territory of Wallis and Futuna, the French Southern and Antarctic Lands (TAAF). All of this is inhabited by 1.6 million French nationals.

France is therefore a power in the Indo-Pacific. As such, it has offered to help its European Union partners, which it has taken care to place outside the US-China strategic rivalry. It is a member of the Indian Ocean Commission. France participates in the ASEAN Defense Ministers’ summits, in its police and intelligence coordination (ASEANAPOL) and should soon join the Regional Cooperation Against Piracy (RECAAP). Ultimately, France, which is to assume the presidency of the European Council during the first half of 2022, planned to make use of its roots in the Indo-Pacific as one of the European Union’s challenges.


Here is the LINK to the original article

United States is losing Europe for alliance with Australia

Was Biden wrong in upseting the oldest ally of United States – France?

I believe it is worth returning to this topic as it is significant on a very broad – global scene. New alliance between Australia, United Kingdom and United States (AUKUS). It would be wrong to see this not really new alliance as “Asian NATO”. Counting remaining two members of the “Quad” (India and Japan) would be, in my opinion premature. That particularly applies for India. India does not want to abandon its Non-Aligned status in return of irritating China. Anyone planning to see Japan as part of that alliance is forgetting enormous historical burden it would bring with it. Not even South Korea would want to join it. Not to mention other Asian states that were victims of Japanese aggression during WWII.

It might turn that by taking his first step towards creation of “Asian NATO”, Joe Biden unintentionally made the first step towards dismantilng NATO! If this turns to be correct prediction then we are witnessing geopolitical change comparable to the fall of Berlin Wall. The “Old Europe” and France in particular are shocked and speachless. Not much is happening behind the closed doors right now but that will change soon. Results of German election for federal parliament are still coming in. As soon as there is new government formed in Germany, there will be very active talks regarding future positioning of “Old Europe”. I have no doubts about that.

What if Washington’s hopes of Green Party in Germany holding country firmly under control? Those curious to see what the real “elections meddling” looks like should pay attention – pressure on all major actors on German political scene will be applied from Washington, Moscow, Beijing and Paris.

Franco-American relations worse since 1778

Defence alliance with the UK and Australia makes sense for United States. These are two countries that followed military adventure of US without exception. However, linking it to France – and the EU – makes no sense in the process. If this announcement was made without breaking contract for submarines between Australia and France, there would be no problems. Appart from countries involved it would be noticed only in Beijing and with mild reaction. With submarines being part of it the new alliance became global news. Reactions from Paris and Beijing were almost equaly lous. And, nobody should be surprised with that.

Biden administration has found itself embroiled in an avoidable conflict with Paris over the canceled multibillion-dollar defense contract between France and Australia. This gap is significant in the annals of Franco-American relations. For the first time since 1778, France recalled its ambassador from the United States. And it is unlikely that all this will soon subside. Inevitably, this will have serious consequences for the entire American alliance with France, the European Union and NATO. Ultimately, China and Russia will benefit from this turn of events.

Lack of sophistication

In fact, the United States and the United Kingdom needed to strengthen their military relations with Australia. It is the most powerful English-speaking democracy in this part of the world. Biden should be credited for doing something truly grandiose. Offering Australia patented American nuclear submarine technology – which Washington hasn’t done for another country since 1958 – to build a strong military alliance to curb China’s rise to India in the Pacific Ocean.

However, nowhere was it written that this union was to be created at the expense of a democratic France. In France, Washington has a capable military partner. The strongest on the European continent.  Like the United States and Britain, France also has interests in the Indo-Pacific.

Five years ago, Australia wanted to replenish its submarine fleet. Its Collins-class diesel submarines were in need of replacement. French defense contractor Naval Group was tasked with replacing six Australian Collins-class diesel submarines with 12 French Barracuda-class diesel submarines.

The deal began to collapse at least 15 months before the intervention of the Americans and British. It also became clear that Australia’s leaders really didn’t want another set of diesel submarines.

Ultimately, however, if Australia does not intend to use nuclear warheads on its submarines, then a nuclear submarine may not be worth the investment and time that Australia requires. Especially given that Australia lacks the infrastructure needed to build and maintain nuclear submarines.

It never occurred to anyone in Canberra or Washington to warn their friends in Paris about Australia’s imminent abandonment of French submarines in favor of Anglo-American ones. Was there really nothing that the Biden administration could not offer as comfort for Paris? It seemed like “adults” were ruling Washington again!

Losing Europe to win Australia?

Biden’s indifference to the interests of France provoked the outrage of the French. In my opinion, combined with some other factors, it could well lead to a serious collapse of the Euro-American alliance.

The severing of Franco-American relations over the Australian submarine deal may have been just the latest in a long string of incidents in which Europe’s leaders needed to take the final step in charting a new course further away from Washington. It will not happen soon but possibility of very different relationship between EU and Russia is quite realistic. Are we going to see Eurasia from Lisbon to Vladivostok without sanctions and walls?

US a big winner of China-Australia trade war

American exporters are emerging as winners from the China-Australian trade war. US goods filling market openings caused by Beijing’s punitive tariffs on Australian goods

Statistics from the Chinese Commerce Ministry, General Administration of Customs of China and trade associations in Australia all show deep dives in the value of Australian exports to China in recent months. 

Australian exporters have been ensnared in a wider geopolitical feud over everything from Huawei’s reputed security risks to the pandemic to alleged foreign interference in local politics. Beijing has taken particular umbrage to Australia’s call for an independent investigation into Covid-19’s origins.

At the same time, American exports ranging from wine, beef, cotton, timber to coal have seen their market share in China grow since last year. US producers are filling the void left by the China-Australia trade row. Beijing has also pledged to buy more from the US as part of its first-stage deal to ease trade tensions with the US. 

Winemakers in Australia who compete with American producers worldwide for market share are particularly being hung out to dry. They exported wines worth a paltry A$12 million (US$9.1 million) to China between December 2020 and this March, representing just 4% of the amount shipped in the same period a year ago.

Chinese tariffs as high as 218.4% on Australian wines have slowed shipments to its usual largest overseas market to a trickle, according to the Australian government’s Wine Australia portal. 

Dramatic changes in the past 12 months

Australian wines used to enjoy zero-duty treatment under a free trade pact between Beijing and Canberra ratified in 2015. Canberra is now seeking redress from the World Trade Organization as it contests Beijing’s sanctions against its wines and other exports.  

Meanwhile, Australian barley and other agricultural products face tariffs of up to 80.5%, after Beijing concluded in May 2020 that China’s annual import of A$2 billion worth of such cereal grain from Australia as animal fodder and beer and beverage ingredient put Chinese farmers at a disadvantage due to Canberra’s supposed “rampant trade subsidies.”

China Customs data also show the nation’s meat imports from Australia dropped 8.5% in the first four months of this while Xinhua said China had stopped importing live lobsters since October as a precaution against “food safety risks.”

Recent price surges of iron ore, which represents the bulk of Australia’s exports to China, have helped to offset slumps across other categories and pushed the total value of exports to China in May up 55.4% to US$13.6 billion. 

American barley has become the new favorite of Chinese brewers and fodder producers after Beijing opened the door for more US agricultural products in May 2020. In March, the US Department of Agriculture also hailed a new monthly high in beef exports to China, hitting 14,552 tons.

The final quarter of 2020 was also a blowout season for American coal exporters when Chinese power plants were told to boycott Australian mined coal and tap other nations’ supplies.

Not just agriculture is hit

A power shortage at the time caused China’s imports of American coking and thermal coal to soar more than sevenfold over the previous quarter. The momentum lasted well into the first quarter of this year, with monthly average imports hovering at around 280,000 tons, according to Xinhua which cited data from China Customs. 

Altogether China imported US$73.59 billion worth of goods from the US in the first five months of 2021, up a whopping 59.8%. Australia’s corresponding total stood at US$62.37 billion, up 33.3%, the latest data from the General Administration of Customs show. 

Xinhua and state broadcaster China Central Television have suggested in recent op-eds and current affairs programs that Beijing should leverage its purchasing power to drive a wedge between Canberra and Washington as Australian businesses and politicians complain about US exporters exploiting their woes and undercutting their markets in China. 

Can Australia achieve economic growth without China?

By Stan Grant

China, India, Indonesia, Russia, Brazil: What do these five countries have in common?

They are the future. Our future depends on them. They are not the West.

Collectively, they will account for more than half of all global growth through to 2024, according to figures from the International Monetary Fund. Think again about that: five countries, 50 per cent of growth.

The giant among the five is, of course, China. It has already surpassed the United States as the biggest engine of global economic growth — 28 per cent annually between 2013 and 2018.

By the end of this decade, China is expected to overtake America as the single biggest economy in the world. And of the other four countries — Brazil, Russia, Indonesia, India — each lists China as its biggest trading partner.

The IMF says there is no way the global economy can grow unless these countries also grow. Yet in this week’s budget, did we hear mention of any of them?

No. We did not even hear mention of China. Incredible, given China is Australia’s biggest trading partner, too.

How is Australia handling this hinge point of history?

Australia’s trade with China dwarfs its trade with any other country: more than $90 billion, an enormous 43 per cent of all our exports. For comparison, the next biggest market is Japan, at $19 billion.

Trade is equivalent to 45 per cent of Australian GDP and one in every five jobs in the country.

Treasurer Josh Frydenberg has said this budget is about stimulating, spending and creating jobs. How do we seriously achieve that when our political leaders cannot speak to their counterparts in Beijing? 

In the meantime, we hear increasing talk of the “drumbeats of war”. How can we achieve economic growth and boost jobs when the Treasurer, in his budget speech, cannot mention China by name and instead makes allusions about a more dangerous world (read: China threat) and commits to ever more spending on our military?

This isn’t to deny that we live in a more perilous age or that an authoritarian China does not present a threat — or that we need to keep our defence force ready and equipped for any eventuality. But there are serious questions about how our political leaders are handling this hinge point of history.

China is an indispensable nation; our future depends on it. Our future depends on those other countries that make up half the world’s growth — countries we rarely even talk about.

This is not 1992. We have not just emerged from the Cold War; America is not the predominant or sole power in the world; this is not the end of history. We can no longer say, as Western political leaders did then, that China is on the wrong side of history.

The world is turning, history is turning

In its report The World in 2050, international professional services company PwC lists what will be the top 10 economies in the world:

1.China

2.India

3.US

4.Indonesia

5.Brazil

6.Russia

7.Mexico

8.Japan

9.Germany

10.UK

Where did the West go? The report says simply: today’s developing markets will be tomorrow’s economic superpowers.

Outside of the top 10, Vietnam, the Philippines and Nigeria will be the biggest movers in the rankings.

The report compares the E7 (emerging economies) with the G7. In 1995, the E7 were half the size of the G7; by 2015, the E7 had drawn level; by 2040, the E7 could be double the size of the G7.

A Rip Van Winkle “go to sleep and dream away the future” approach won’t work.

The West has been battered by war, growing inequality, stagnant wages, terrorism, economic collapse, declining democracy and rising political populism.

America — the so-called leader of the free world — is a country damaged by unending crisis.

President Joe Biden talks a good game about “America is back” and rebuilding alliances. But how does America lead a world where economic power has so dramatically shifted?

Betting against America

In his recent speech to Congress to mark the first 100 days of his presidency, Joe Biden said it was never a good idea to bet against America. But that’s precisely what many countries are doing.

China’s massive Belt and Road Initiative — one of the largest infrastructure and investment projects in history, covering 70 countries, 65 per cent of the world’s population and 40 per cent of gross domestic product — is a bet against America.

It is part of Xi’s China Dream of a rejuvenated nation, returned to the apex of global power.

Australia is caught in the crosshairs of this global historical turn. We are still a European outpost in Asia, a country with historical ties to Britain and all in with the US. 

It has served us well, but that world is passing. The geopolitical, economic and military plates are shifting as the world walks ever more treacherous fault lines.

But this isn’t the discussion we have been having post-budget.

Instead, we are talking about debt and deficit and vaccine rollout and possible election dates. Journalists are engaging in the usual round of predictable “gotcha” questions, and politicians are looking to score tit-for-tat political points.

All around us, the world we knew is giving way to the world we don’t truly understand, let alone are truly equipped for.

China, our biggest trading partner, is now a global Voldemort — he who cannot be named.

But call it what we will — or won’t — China looms over our world and it is dragging those other emerging economic giants along with it.

To stay with the movie analogy, for the West, there is no back to the future.


Source: ABC