It's all about China, Australia just won't say so

The latest in a series of announcements aimed squarely at China, without specific acknowledgment that is the case, is new legislation that will give the Foreign Affairs Minister power to veto or revoke deals between state and territory governments and foreign governments.

Even including local councils and sister city arrangements, under the new scheme that covers councils and universities, Foreign Minister Marise Payne could cancel Victoria's memorandum of understanding with China on the Belt and Road Initiative, or scrap the Confucius Institutes attached to a number of Australian universities.

"I reject that," Mr Morrison said to a question asking whether this latest announcement or Australia's new defence direction were attacks on China.

But pressed on whether new measures were all about Australia's largest trading partner, Mr Morrison would only say "these laws are about Australia's national sovereign interests".

Speaking to the National Press Club yesterday, China's second-most senior diplomat in Australia compared the relationship to a marriage.

"It is no easy task to keep a partnership in good shape," Wang Xining said.

"It takes concerted determination and joint efforts to make it thrive. Married couples know how hard it is."

If this was a marriage, Australia would be packing its bags while telling China everything was fine.

But of course, everything is not fine. Australia is taking an increasingly hardened stance against China, while insisting the two countries have a healthy Comprehensive Strategic Partnership and a mutually beneficial economic relationship.

Before this latest announcement, there was Australia's newest defence spending, and a repositioning where Mr Morrison warned of a "new dynamic of strategic competition" and signalled a renewed focus on Australia's immediate region.

There's been new cyber security spending aimed at stopping cyber attacks that are often attributed to a "sophisticated state actor", and a new cross-intelligence agency taskforce meant to disrupt foreign interference. All the while, the elephant in the room is waiting to be named by Mr Morrison.

"Clarity creates certainty," he said on Thursday, maintaining Australia had been clear and consistent in its stance on the country's interests and sovereignty.

Others would disagree.

Allan Gyngell, a former director-general of the Office of National Assessments and now president of the Australian Institute of International Affairs, said Australia was sending signals in the defence and foreign policy arenas, but they aren't easily interpreted by the public

"The government does need to make a comprehensive statement or speech on how it sees the China relationship now," he said.

"China is the unspoken issue in defence and foreign policy statements, but there comes a time when you need to be clearer and that time has come."

Dr Bec Strating, executive director at La Trobe Asia, also wonders how long Australia can continue to make such announcements without making its position clear.

"It's hard to have a coherent narrative when there's all these different audiences," she said.

"It's not a bad idea for the government to make all these announcements 'country-neutral,' to not pin it on any particular state - the problem is, we all know really what it's about."

On the substance of the announcement, Mr Gyngell said he was somewhat surprised the Coalition government had made such a move. Apart from Victoria's Belt and Road Initiative Memorandum of Understanding with China, "looking back historically I can think of very few issues where the actions of the states had come into conflict with the national interest," he said.

Dr Strating pointed to the Confucius Institutes as likely targets for the new scheme, as well as Victoria's Belt and Road agreement, although it had more symbolic weight than actual commitments, she said.

"There's this thought in some corners that what Beijing will try to do is a divide-and-rule strategy where they can circumvent the Commonwealth government, which has responsibility for foreign policy and national security; they can circumvent those bodies and engage and curry favour with the state governments," she said.

"It is a response to those concerns, to those specific agreements, but also needs to be contextualised in this broader hardening of the Commonwealth government's approach to engagement with China."

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At the same time as Australia has announced these policies, including pushback against interference and more spending on long-range missiles, the focus on diplomacy has slipped.

While spending on the military has increased, the diplomatic budget has not.

Already with a small diplomatic footprint, the Department of Foreign Affairs and Trade announced a reduction in 60 positions in July - not cuts, but by not replacing those who leave.

Ten of those positions are in overseas postings, including in Beijing, Port Moresby and Jakarta.

Mr Gyngell says Australia now has an imbalance between its investment in the two areas of statecraft.

"We are beginning to be hobbled in our international efforts by the relatively smaller investment in foreign policy and diplomacy compared with defence and security," he says.

Despite the 2017 foreign policy white paper outlining a focus on partnerships in the Indo-Pacific region, Dr Strating said that is failing to materialise, and cuts to DFAT aren't helping.

"If you want to reduce dependence on China and become more self-reliant, it requires diversifying," she said, referring to relationships with countries like India and Indonesia.

"The government should be investing as much in DFAT as it does in Defence, and we are seeing a real imbalance in the Morrison government response to strategic issues."

Just last month, Dave Sharma, a government backbencher and former ambassador to Israel, wrote that Australia needed a diplomatic step-up to match the military step-up.

Time will tell if that is the next major foreign policy announcement the Prime Minister will make without mentioning China.