China announced last week that it had indefinitely suspended its high-level economic dialogue with Australia, blaming the decision on the "current attitude" of the Australian government towards it. While the move appears largely symbolic, it does signal that Beijing is set to tighten the screws on Canberra after having leaned heavily on Australian exports like wine and barley over the embarrassment it felt last year when the Scott Morrison government demanded a probe into the origins of the coronavirus pandemic. Both being members of the Regional Comprehensive Economic Partnership agreement, which is getting set for lift-off, this in some ways is a setback to the wider Asia-Pacific region as well.
China has been aggrieved over Australia's decision to cancel agreements under China's Belt and Road Initiative signed with Victoria state and to review the lease of Darwin Port, used by the Australian and United States navies, to a China firm. It also has taken a dim view of the Quadrilateral Security Dialogue, which groups the United States, Japan and India with Australia. The Quad, as it is called, is gathering momentum and many see in all this an attempt to contain China. Certainly, all four Quad members seem to have a shared assessment of the challenge from Beijing. Last year, their navies conducted war games jointly on both flanks of the Indian peninsula in a clear signal of their maritime priorities. Will Canberra blink?