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Welcome to The Chair.
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I'm your host, Dr. Vicky James Wren.
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And today we're having a quick look at the Australian election and our Labor's
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leading in the polls by about 10 points.
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But what that really means is if they lose five, it's going to be 50-50.
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So 45 to 55 for Labor.
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Now, Australia is in trouble.
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the economy is going to have and look the imf said this quite a few years ago uh 10
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years of declining living standards so now labor has gone from a couple of a couple
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of surpluses for the last few years now it's running going to go straight back into
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deficits and that money is going to be going into health care
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renewables, education, and the biggest one, of course, defense.
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Why, of course, I'm not really sure why, of course, but housing is also big.
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Medicare, so giving better medications and so forth.
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All that's going to come under
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conflict with the Trump administration's policies towards Australia and as I said
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with the aluminum or aluminium as the Australians say that's going to be
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problematic as well look it's very small percentage of GDP but you know it's the
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compound effect of all of the tariffs and the effect of the tariffs on other
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countries which trade with Australia and that's primarily China of course
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And so the boom,
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sort of the mini boom,
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let's say,
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that's been going on with minerals,
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you know,
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there was a really big boom back in the 90s and 2000s,
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but that's over.
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But in the last few years,
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there's been another boom as China's economy has switched into the new productive forces,
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EVs,
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of course,
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and solar panels and so forth.
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And now Australia is also transitioning and they rely on China for that.
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There's nowhere else they're going to be able to get this,
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you know,
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affordably,
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so good,
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fast and cheap,
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right?
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So that is the permanent dilemma the Australian government is in,
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balancing their security arrangements with the Americans,
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with their trade relationship with China.
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Now,
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China is far and away the biggest trade partner of Australia,
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and the budget doesn't really mention that,
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according to all of the information that I've been able to access.
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And you can read this in the ASEAN Chair.
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ASEAN Chair that has released...
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once a week there's updates on that there are other updates daily you can check
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daily but what we're looking at here is a very difficult election look I think
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Labor's probably going to win it I'll call it and say they're going to win but it
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look it could be very very narrow win and it's possible that the Greens may hold
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the balance of power or the teals as well which is you know young educated urban
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elites may hold the balance of power in the Senate and
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And an unlikely outcome,
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but possible outcome,
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is that they may hold the balance of power in the House as well.
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That is not good because,
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as we can see,
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it's happened in Europe with all of the political turmoil in Europe.
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Weak coalitions just cannot hold against the tariff and Trump effect.
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And so I think that's also true here in Australia.
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So one has to look very, very carefully at that.
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So if you're voting, just keep that in mind.
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Donald Trump really was asked the other day about AUKUS and he had to ask the journalist,
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what does that mean?
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He didn't really know.
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Now,
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it doesn't mean he doesn't know about submarines and he doesn't know about
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Australia's importance to the American security framework,
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you know,
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forward posture into Asia.
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And that's what it is, forward posture.
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You know,
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I'd be very,
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very worried about listening to John Anderson's podcast and YouTube channel where
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he interviewed the former Home Affairs Minister of Australia and they
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They were talking about a tyrannical China and Australia can't live with a China
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like that and so forth and so on.
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But this is absolutely not true.
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Look,
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China is not in any way interested in invading Australia or taking over Australia
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or anything else.
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What China is interested is stability.
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And Australia needs to be in stability as well.
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And the greatest source of instability in the world today is the United States.
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So this security arrangement...
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and the exorbitant,
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and I mean ultra-exorbitant cost of these submarines,
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which is basically just three really old Virginia-class American submarines based
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out of Western Australia and possibly some others based out of Wollongong or south
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of Sydney on the East Coast.
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uh i mean they're just american submarines being based out of australia uh there's
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technical upgrading and all that sort of thing for the australians so nuclear
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energy and things like that and the liberals uh you know the opposition they're
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promoting nuclear energy which is really not going to work very well but there is
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concerns of course about the
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the grid and being able to give stable enough energy and low cost for consumers but
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stable enough energy for you know the AI wave that's happening right now.
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Huge data centers need really reliable power and they quite often need enormous
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water resources for cooling and that means being able to build desalination plants
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in Australia's case because water is something Australia does not have a lot of.
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Now, let's think about China and its Australian exports.
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Australia is going to maintain and to get growth because it's anemic at the moment.
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To get growth, Australia is going to have to have a better relationship with China.
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And so the Trump tariff effect and...
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the new cabinet that he has,
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Hegseth as a military defense secretary,
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Marco Rubio,
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who's,
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you know,
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basically a neocon,
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totally anti-China.
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He's going to try and play Philippines.
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He's going to try and play Taiwan.
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But Australia cannot be falling into that.
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Now, Albanese, he has, and his government has...
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navigated a careful path along that line,
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but how much further they can go is going to be difficult.
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But look,
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I can see right now that although public opinion is not really changing
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definitively toward China,
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mainly because of the Rupert Murdoch News Corporation effect,
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which dominates Australian media to an extraordinary amount,
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And the idea that the ABC, that's the national broadcaster, needs to keep a measure of balance.
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But it's not really watched by most Australians.
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The mediascape is still anti-China and I think that's the next step that has to change.
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But Twiggy Forrest,
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one of the richest men in Australia who owns enormous iron ore mines in Western
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Australia and made his fortune in the iron ore to China trade and is still doing
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very well with that,
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has just succeeded in suing Meta or Facebook for things related to using his image
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uh for scams so online scamming being run by facebook and not just in australia but
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globally uh and as it puts that puts a very bad light on on the scams that have
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been reported all the time in cambodia and thailand and other places uh and uh so
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many indians uh but most recently uh been caught up in that not so many chinese um
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but twiggy forest action in america and against meter where he's uh he's won
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I don't know what the final ruling will be,
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but this tells us that the media interference in Australia is to a really abnormal
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level and basically is always or has always been anti-China.
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And once that chain is broken,
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once Rupert Murdoch's news corporation is not able to operate and that Meta is
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finally sort of pushed into a free speech and no scamming,
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well then possibly...
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Possibly we might find that the Australian electorate might start to believe that
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being friendly with China is in their best interest.
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And they used to think that prior to 2015.
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But, you know, it's a Morrison government, the Liberals and Morrison changed that.
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And so, let's get back to the election.
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Despite the media,
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let's say,
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imbalance in Australia,
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Labour has been careful to navigate,
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and that's historically been their case.
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They've always been pro-Asia, not just pro-China.
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You remember that Japan and South Korea are also very big markets for Australian exports.
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ASEAN is growing.
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There's a huge contingent of Australians in Vietnam and Cambodia and Thailand.
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trying very hard to build Australian businesses and education and health and
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services and so forth.
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And that's probably a good thing, generally speaking.
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So if the Labour can get back in,
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and I think they will,
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as I said before,
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there's a very good chance that those may strengthen.
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And that's going to be very good for China.
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And then one just needs to cast a quick eye,
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and we're still referring to the Australian election here.
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We just put a quick eye on to what's happening in China and...
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uh clearly they've just hosted a 60 i think it was 60 american business leaders and
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where um has said that china is opening up more and there's going to be more 100
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owned foreign businesses now this is an attempt to attract japanese south korean
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australian rcep investors and european investors and american investors to the
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chinese market where there's real growth because remember the atlanta fed just said
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two days ago that the the us was in indirect
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definitely going to have a contraction of over two percent in the second quarter.
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And all these tariff policies that Trump's put in has affected the dollar badly,
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it's affected the markets badly,
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it's affected the gold price.
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And so
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I think we're going to see that there's going to be more capital outflows out of the US.
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Now it's still an enormous capital market,
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much,
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much larger than Europe,
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which is number two,
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and China,
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which is a very small number three in that.
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But that was the case with cars before.
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That was the case with computers before,
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with chips,
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with phones,
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and with many,
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many other areas of what the manufacturing and the goods and services that we buy.
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still emanating from China,
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and as China moves up that value chain,
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I think that's very attractive for foreign investors,
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and that means Australia too.
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Now, Australia has got a chance here to really extend its lead in exports into China.
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Remember,
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Australia is a major competitor with the US for many exports,
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so the Americans don't like to see the Australians selling their agriculture or
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their minerals into China.
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And they're going to do whatever they can to stop that.
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There's no good on you, mate.
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Let's all be fair and be friends and have a beer at the pub.
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It's not like that.
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And just talking about beer,
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part of the mini budget that's been released is to take away excise or taxes on
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beer and wines and things like that.
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And that's probably very good.
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And what Australia needs to be doing, and I think what...
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Albanese is trying to achieve in the budget tonight is to get Australian companies
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to be more innovative,
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niche markets and sell into China and Asia much,
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much more.
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The US market, I think, is not going to be the target for them.
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Look,
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it's going to cost them enormous amounts of money and investment to get into the US market.
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it's not worth it go to china go to asian invest your money in there and i think
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you know as i said vietnam cambodia thailand malaysia indonesia that's the way to
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go and i'd like to see and of course number one is china and then japan south korea
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i'd like to see australia companies doing that
