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Former Australian PM sees role for Canada in world tilting toward China

Former Australian prime minister and foreign minister Kevin Rudd is seen in a  February 2012 file photo.


Kevin Rudd, the former prime minister of Australia, dreams of what he calls the Pax Pacifica, a 21st century in which the world peacefully accommodates both a rising China and a declining America within the embrace of once-Western but now universal values of collective security, globalization and rule of law.

Over the past week or so, Mr. Rudd has discussed his vision for a globally integrated China with UN Secretary-General Ban Ki-moon, U.S. Vice-President Joe Biden, former secretary of state Henry Kissinger and, on Wednesday, Foreign Affairs Minister John Baird.

Mr. Rudd arrived at a time when Ottawa could use some friendly advice from a politician who has been studying China for more than 30 years. The Conservative government is grappling with the proposed acquisition of Nexen, a Canadian petroleum firm, by CNOOC, a Chinese state-owned oil company.

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And on an international scale, tensions are running alarmingly high between China, which claims virtually all of the South China Sea, and its neighbours, who claim parts of it.

Mr. Rudd pointed out in an address at the University of Toronto earlier this week that for the first time since George III was king, "a non-Western, non-democratic state will be the largest economy in the world." And this will happen in a matter of years.

Yet for centuries the Middle Kingdom has sought to dominate its own sphere while completely ignoring everything outside it. How is China to be brought into the centre of the world?

"China is a strong country," Mr. Rudd replied in an interview, but "China also respects strength." Western nations must accept, he said, that, "there are times when we will have a principle-based disagreement, and we should never walk away from that. That's just being realistic."

China, in other words, must neither be kowtowed to nor needlessly aggravated by former colonial powers who have little moral capital within the region.

Mr. Rudd believes Canada and Australia should become partners in exploiting the potential of a world whose geopolitics are shifting more quickly than anyone expected or few imagined.

With "the centre of gravity now increasingly moving into the East-Asian hemisphere, together with the overall dynamics of globalization … this is going to bring Canada and Australia much closer together than in the past," he predicted. "This is a good thing."

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As in Australia, Canada is grappling with Chinese offers of much-needed foreign investment, while worrying over what strings might eventually be revealed. On the proposed CNOOC-Nexen deal, while Mr. Rudd has "never been in the business of providing any foreign government with gratuitous advice," he added that Australia is a major recipient of Chinese investment. "So we have some experience in these matters."

"CNOOC is a company I know very well. They're a good company," he said, adding that in Australia, as in Canada, each proposal must be considered on its merits.

This is not a view universally shared in Australia, where Opposition Leader Tony Abbott of the Liberal Party is well ahead in the polls over the Labour government of Mr. Rudd's successor, Julia Gillard. Mr. Abbott declared earlier this week that "it would rarely be in Australia's national interest to allow a foreign government or its agencies to control an Australian business." Chinese acquisitions are particularly "complicated," he said, because so many of its large firms are state-owned.

One way to manage China might be to embrace its neighbours, which is an unstated purpose of the Trans-Pacific Partnership talks, an ambitious set of trade negotiations involving the United States, Australia and a range of Latin American, Asian and Pacific nations. Canada recently won American approval to join the talks, but the agreement could force this country to abandon protection for its politically powerful dairy and poultry industries.

"A free-trade agreement must be compatible across all sectors and in-depth within sectors. Otherwise, you're kind of dancing around the edges," Mr. Rudd observed. "This always involves difficult choices for countries."

But "from Canada's perspective, [a TPP agreement] would open a whole bunch of new doors."

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Including with Australia. The two countries' economies are so nearly identical that Australia is often seen as a competitor by Canadian companies selling natural resources overseas.

"I think this is total BS and should be consigned to the rubbish bin of history," Mr. Rudd argued, firmly. He believes Australian and Canadian companies and governments should exploit joint opportunities for selling into emerging markets.

Mr. Rudd, who is 54, grew up in the high noon of the American century. He hopes that the 21st century will be known, not as the Chinese century, but as his Pax Pacifica – "an international rules-based system, anchored in the universal values which we hold to be dear, but with different voices around the table. And we should be comfortable about that."

Does that mean China will one day evolve into something resembling a democracy? Mr. Rudd shrugs slightly.

"It is one of the great unpredictabilities of the age."

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