In the moment, Scott Morrison’s angry denunciation of the offensive Chinese tweet about alleged Australian war crimes seemed a reasonable response.

In retrospect, it was probably ill-judged. This is so even though the response had bipartisan support.

The Chinese immediately knew they’d touched a raw nerve, and kept pressing it, through their hyperbolic mouthpiece The Global Times, and their embassy in Canberra.

They grabbed an opportunity to get their own back at a country inclined to focus on their bad human rights record.

In trying to show strength, the Australian government had exposed its sensitivity.

Morrison probably realised this. Twenty-four hours after calling his “virtual” news conference (he was still in quarantine at The Lodge following his Japanese trip) he told the coalition party room (remotely) that the government’s response to the tweet did not need amplification.

Read more: Politics with Michelle Grattan: Asia-Pacific expert Bates Gill on China's endgame^[1]

On Thursday he wouldn’t even be drawn about the Chinese social media platform WeChat taking down a message of reassurance to the Australian Chinese community he had posted.

The digitally-contrived image of a soldier with a knife to a child’s throat tweeted by China’s foreign affairs spokesman was the equivalent of a highly objectionable cartoon. With hindsight, Morrison might have been better to send out a minister to respond to the tweet, or simply to dismiss it with a brief condemnatory line and minimum elaboration.

The tweet was part of the cat-and-mouse game the Chinese are playing with Australia. This might hurt their international image – it certainly should. But the price for Australia is much higher. Strikes at Australian exports are costly and disruptive for businesses and industries at the worst possible time, in the year of COVID.

More generally, it is hard to avoid the conclusion China is treating the Australian government with contempt. How else can we read it when Australian ministers haven’t been able to get their phone calls returned?

Within Australia there is a range of views on how to cope with this situation.

Some in business have urged the government to tone everything down, to be much more accommodating to China. On the other hand, some on the Coalition backbench and among the commentariat believe China should be given no quarter.

In response to what has become a more assertive and interfering Chinese regime, the government’s stance can be characterised as hawkish in action while reaching out rhetorically.

Even as he raged about the tweet on Monday, Morrison said he hoped “this rather awful event” might lead to a “reset” where dialogue could be restarted. At his Thursday news conference his message was the government’s desire for “constructive and open and regular dialogue at leader and ministerial level to address the tensions that are clearly there in the relationship”.

But also on Thursday parliament was considering legislation for a new national security test for foreign investment in a “sensitive national security business”.

It’s not admitted directly but this is aimed squarely at Chinese investment. It’s justified – but the Chinese judge the Australian government by its actions, not its words.

Legislation is also before parliament to allow the federal government to quash agreements state or local governments or universities have or propose with foreign governments. This has Victoria’s belt and road deal with China in its sights.

Critics see the government’s early call for an inquiry into the origins and handling of COVID-19 as an ill-judged provocation of China, and even date the deterioration in the relationship from then.

Undoubtedly China was angered. But its discontent goes much further back and is much broader, as its recently-circulated list of 14 grievances makes clear.

And the COVID call was reasonable enough, even if it invited angst. The pandemic has been a stop-the-world sort of event and how it all happened is significant for the future.

Read more: What's behind China's bullying of Australia? It sees a soft target — and an essential one^[2]

The unpalatable truth is that Australia has limited agency in how relations with China go from here.

The government won’t (and shouldn’t) make U-turns on key policies, such as Malcolm Turnbull’s law against foreign interference.

China is not likely to be swayed by rhetoric. And if one point of its concern is that Australia’s voice on certain issues (such as its warnings on Huawei) influences other countries, China will have even less reason to reduce its pressure.

For however long it wants to get in Australia’s face, China will play havoc with some of our exports. Australia takes comfort from the fact that its biggest export there – iron ore – is protected by China’s dependence on this supply and the difficulties of finding alternative sources. But that situation can’t be taken for granted indefinitely.

How the relationship evolves from here will be affected by the China-United States dynamic, as the Biden administration reshapes America’s policies. But it’s expected the Biden reset will be a matter of degree.

Whatever faults there have been on the Australian side, the rough-edged nature of the bilateral relationship is just one manifestation of China’s muscling up in the world, and particularly the region.

In 2014 Chinese President Xi Jinping addressed the federal parliament.

This was Xi’s fifth visit to Australia and included a trip to Tasmania which, he noted, meant he would have been to all states and territories. He was lyrical about the country’s “strange-looking kangaroos”, “cute koala bear”, “flocks of white sheep” and “ingenious Sydney Opera House”.

He was also very positive about the bilateral relationship (although China watchers might have read cautionary signs in his wider comments).

Read more: China hits out again – then tells Australia to fix the relationship^[3]

“China has always viewed Australia as an important partner,” he said.

“During my visit, the two sides have decided to elevate our bilateral relations into a comprehensive strategic partnership and announced the substantial completion of Free Trade Agreement negotiations. These two important outcomes will further boost China-Australia relations.

"Our relationship has reached a new and higher starting point, and we should be more visionary, broad minded and set more ambitious goals. Our two countries should increase dialogue and exchanges and deepen political trust, expand result-oriented cooperation, and work together to sustain peace, stability and prosperity in the Asia-Pacific.”

For Australia, this key relationship hasn’t become any less important in the relatively few years since Xi’s fifth and presumably last visit – indeed it’s more important. But managing it has become something of a political nightmare.

References

1. ^{^} Politics with Michelle Grattan: Asia-Pacific expert Bates Gill on China's endgame (theconversation.com)
2. ^{^} What's behind China's bullying of Australia? It sees a soft target — and an essential one (theconversation.com)
3. ^{^} China hits out again – then tells Australia to fix the relationship (theconversation.com)