Australia's trade would be fatally exposed in a US-China war

Asia Times

2 days ago

If war breaks out between the United States and China someday, one of the major concerns for Australia is the impact on its trade.
Our trade routes are long and exposed. Every year, thousands of merchant ships — bulk carriers, tankers, container ships and other types — visit Australian ports to deliver imported goods and pick up exports for delivery at distant ports.
When a cargo ship of petroleum leaves the Persian Gulf for refining in East Asia, then sails for Australia, the total trip is approximately 20,000 kilometers. The ship passes through lonely stretches of sea and numerous choke points, such as the Strait of Malacca in Southeast Asia, often within range of missiles and other weapons.
Such attacks could come from Chinese ships in the event of a war, or as we've seen in the Middle East with the Houthi rebels, they could also come from militants seeking to disrupt global shipping.
Australia's current defense strategy cites the security of our 'sea lines of communication and maritime trade' as a priority. The aim is to prevent an adversary from cutting off critical supplies to our continent in a war.
To achieve this, the government has embarked on the lengthy process of expanding the Royal Australian Navy surface and sub-surface fleet, including the acquisition of nuclear-powered submarines.
As I explain in my forthcoming book, The Big Fix: Rebuilding Australia's National Security, the problem with the government's maritime plan is that it is built on a deeply flawed foundation and cannot deliver what it promises.
Defense documents insist on a need for the Australian Defense Force to be able to project naval power far from Australia's shores in order to protect the nation's trade. The presence of these warships would ostensibly deter attacks on our vital shipping.
However, those who developed the maritime plan do not appear to have considered whether the merchant ships delivering this trade would continue to sail to Australia in the event of a war — presumably with China.
The reality is that Australia's A$1.2 trillion (US$778 billion) of exports and imports are carried in ships owned by non-Australian companies, flying foreign flags and largely crewed by citizens of other countries.
Decisions about whether to continue sailing to Australia during a conflict would be made in overseas boardrooms and capitals. The Australian government has no leverage to force the owners of these ships to continue to service our continent. Australia's national interests may well not be the paramount concern.
Nor does the Australian government have the option to turn to Australian-flagged vessels. Australia's shipping list contains only a handful of domestically owned and flagged cargo ships available in case of war.
In fact, the biggest vessel (by length) that the government could take into service is the Spirit of Tasmania IV ferry.
If all goes according to schedule, at some point in the 2040s, Australia will have at most 26 surface warships and perhaps eight nuclear-powered submarines, the navy hopes to acquire through the AUKUS deal. Australia is expected to acquire three Virginia-class submarines from the US under the AUKUS deal. Photo: Colin Murty / AAP via The Conversation
Due to training and maintenance requirements, the total number of vessels available at any one time would be more on the order of ten.
In other words, the government's future maritime plan, costing hundreds of billions of dollars, may result in just ten available ships at any given time to protect the nation's trade over thousands of kilometers.
Fortunately, Australia has other options for safeguarding its trade that don't necessitate the building of warships.
Our first investment in security should be diplomatic. The government should prioritise its investment in diplomacy across the region to promote security, including trade security.
Regional countries are best placed to secure the waterways around Australia, particularly from the most likely future threat: Houthi-like militants.
The Australian government should also modernize its shipping regulations and include in the budget provisions for war-risk insurance. Such insurance could compensate owners for the potential loss of ships and cargoes as an inducement for them to sail to and from Australia during war.
The government must also encourage greater investment in our national resilience. Currently, the biggest risk during a conflict is an interruption to the nation's liquid fuel supply.
We must greatly expand our onshore reserves of fossil fuels in the short term, while initiating a nation-building project to electrify the economy in the long term. Electrification would eliminate a considerable vulnerability to national security.
Additionally, the government should identify and subsidize vital industries, such as fertilizers and certain medicines, which are essential to the continued functioning of our society in the event of a war. This would reduce our reliance on imports of critical materials.
Lastly, Australian industries, with the government's assistance, should further diversify their trading partners to reduce over-dependence on one or two main destinations.
Trade is undoubtedly important to Australia and the government is correct to protect it. But it is also true that not all security problems are best answered by the military.
This is particularly important since the size of our planned fleet is obviously insufficient for the enormous task it will face. Either Australia invests in impossibly large numbers of warships or it takes a different path.
The art of war requires a balance between the desired ends and the means to achieve them. This simple statement underpins the formation of all good strategy, which a state ignores at its peril.
Unfortunately, in the case of the nation's maritime plan, the ends and means are seriously out of whack. Instead of setting itself up for failure, the government needs to put aside its ineffectual maritime plan and choose the means that do align with the ends. Only then will it be possible to protect Australia's trade.
Albert Palazzo is adjunct professor in the School of Humanities and Social Sciences at UNSW Canberra, UNSW Sydney
This article is republished from The Conversation under a Creative Commons license. Read the original article.