An Australia-China free trade agreement: managing an elephant

Abstract

This paper explores the advantages and disadvantages of a free trade agreement (FTA) between Australia and China. As with any international agreement, Australia must balance political and economic factors at home and abroad. While Australia receives economic benefit from China at present, the latter may become an even more gigantic competitor against whom it will be vain to struggle. There are already clear winners and losers in the relationship, and the long-term advantages of an FTA that might make competition even easier for China must be called into question. Notwithstanding, perhaps Australia should seek an agreement as a gesture that might help to keep China on side.