Friday, February 22, 2019

Under The Radar (Corrected)

Everyone is talking about what is described as President Trump's trade war with China, a war the president appears to be winning.

Few seem to have noticed the trade war between Australia and China, which war Australia is losing big time.  It started with Australia banning Chinese firm Huawei on account of security fears over compromised computer technology.  China has retaliated with a sledge hammer.  It has banned the importation of Australian coal through five of it's major ports.   China just happens to be Australia's second biggest coal customer.

So much for all the bulldust about Huawei being a commercial enterprise and not government owned.  Everything in China is 'government owned' including the students who study overseas.  It is noticeable that there has been a huge drop off in Chinese enrollments at Australian universities since this dust up started.

Will iron ore be next?

27 comments:

Noel said...


This ones not a paywall.
https://www.reuters.com/article/us-china-australia-coal-exclusive/exclusive-chinas-dalian-port-bans-australian-coal-imports-sets-2019-quota-source-idUSKCN1QA0F1

Interesting points
1.8 percent of Australia's total coal exports.
Claims to protect the price of coal mined in China;

Gerald said...

I believe the BHP assessment below is probably best.
It is a bit like the Air NZ plane turnback and Sandford exports clearance slow down in China been read by the media as a result of GCSB Huawei decision.

https://www.abc.net.au/news/2019-02-21/china-bans-coal-import-and-send-dollar-tumbling/10835136

Kimbo said...

A warning to both Australia and New Zealand not to fall into the trap of having too narrow one range of goods supplying just one market - as we both found to our cost in 1973.

Having said that, and even though we are in the same boat, little sympathy for Aussie when they get burned on trade deals. The contemptible way Paul Keating cancelled the “Open Skies” deal back in the early 1990s, including notifying our government by fax after the Aussie media were told, and then later Australians blaming Air New Zealand, our PM and Kiwis when their dog Ansett Australia went belly-up hasn’t been forgotten. At the end of the day Aussie will treat New Zealand with the same contempt that China treats us both if it suits them. Larger countries have been doing it to smaller countries since...forever.

Adolf Fiinkensein said...

I stand corrected. Last available figures from 2017 have Japan as Austrlalia's No 1 coal customer at 30%, with China number 2 at 20%.

RosscoWlg said...

Kimbo... unfortunately for you but fortunately for us we are not a command economy, your comment "A warning to both Australia and New Zealand not to fall into the trap of having too narrow one range of goods supplying just one market " shows your total lack of appreciation of business and how business works.

But you may like to advise sweet little Jaxie what your winners are and then everybody else can avoid them like the plague. You certainly have a future career in business advising.....somewhere!

Oh and by the way the Ansett screw up was totally down to Air New Zealand and poor management and even worse due diligence

Adolf Fiinkensein said...

Of course, one's attention should remain firmly on any further moves from China to curtail Australian imports. If she does, then the fat will really be in the fire and there;s not a damned thing the Ockers can do about it except crack open an extra stubby or two to drown their sorrows.

Let's reflect that China underpins Australian university enrollments, the Sydney apartment market, the coal industry, the iron ore industry and the LNG industry.

The Chinks have the Ockers over a barrel - literally. And the Ockers were too dumb to see the train wreck coming.

RosscoWlg said...

Doesn't anybody read Tzu "The Art of War" anymore?

Why would a Wheta and a Platypus confront a Dragon? At the risk of sounding boring... I'll repeat my flow chart just so Eggie can arrogantly dismiss it again (Wiggo is a sucker for punishment)

Somebody more circumspect would have played for time..

Step 2 allow them to be in the tender.

Step 3 delay the tender.

Step 4 Obfuscation

Step 5 Re run the tender with new rules.

Step 6 Announce changed mind on new Broadband as economics suspect.

Step 7. Adjust strategy as new information comes top hand

Repeat from Step 2.

Tom Hunter said...

And the Ockers were too dumb to see the train wreck coming

And us? Have we been any better? Look at the amount of excuse making, deflection and defense of China that's been coming from the Right on this issue. Sans the usual USA-hatred they've found themselves in bed with Keith Locke of all people.

BTW - I came across that via Pablo's comments on Kiwipolitico, Interest, values, trade and security. Pablo is reliably left-wing - well with the exception in the Far Left's eyes of being an American who worked for the CIA - and can be counted on to give me a regular dose of the shits on any given day :).

But his take on this has been consistent from the start and interesting, especially compared to the likes of Chris Trotter, who like Locke, can't haul his aging backside away from his 60's/70's roots when it comes to things like China vs US.

Pablo's comments wend their way through Capitalists can't be patriots to accepting that the current Right-wing blogsites and other places are very much agin China on this one. He also echos what you said, Kimbo:

But that assumes that NZ has a choice in the matter and that its behaviour will influence the corresponding behaviours of its larger, contending interlocutors because their respective interests are maintained by our dichotomous foreign policy approach. That is a very tenuous assumption to make because it is also quite possible that in the end it will be a larger partner who, exercising its power over us in its own national interest within a strategic context dominated by great power rivalries, that makes the choice for us.

And by that he means it could be either the USA or China. Twas ever thus.

Kimbo said...

@ RosscoWig

So when you say that it was Air NZ’s job to do due diligence before buying Ansett Australia - which indeed it was, caveat emptor and all that - you acknowledge my point it was a dog they should never have purchased in the first place. So no, not “totally” an Air NZ screw up. in their desperate need to break into a market that should never have been denied to them (on the basis of reciprocity, Ansett NZ and all, but good on the free-market-purity 4th Labour government for ballsing up that obvious quid pro quo)

...they foolishly accepting a hospital pass of an inevitable problem originally caused by Aussie governments (including the afore-mentioned cancelling of Open Skies to maintain an inefficient oligopoly) and unions.

And while governments are no longer in the business of “picking winners” (Shane Jones notwithstanding) they nevertheless help to set macro level arrangements such as FTAs that allow winners to emerge and stay on top. Put it this way, if we in NZ cave in and let Huawei operate in the way they and the Chinese government want, then it will be because we want existing winners such as Fonterra to continue hoicking their product to them, just as was the case with Anchor and Canterbury lamb to the UK. Maybe better to start sucking it up now as we had to in 1973, and tell the Chinese to fuck off...in the most polite and diplomatically acceptable way of course. 😀

Adolf Fiinkensein said...

I think Kimbo is right.

For example, I'd be doing everything I could to encourage businesses to expand their export businesses into India and the UK. India is a burgeoning market for foodstuffs with teeming millions being raised from poverty to relative prosperity and the UK is about to be rid of all those appalling EU market restrictions.

In short, I think NZ is better able to weather a China induced shit storm than is Australia, largely because Australia has already shot itself in the foot. BUT - give the SLG a week or so and she'll manage to fuck that up as well. She's doing a great job on the NZ?Australia relationship today.

Kimbo said...

@ RosscoWig

I’m sure that while the Chinese know of Sun Tzu, they are equally aware of Clausewitz - “war is the continuation of politics by other means”. Hence at the moment they are using heavy-handed politics to try and achieve their ends.

And as they are the ones currently running our exports through the “endless bureaucratic loop” MO that you suggest, I reckon they’d pick it very quickly if we tried the same. But hey, Nixon and Kissinger ran good cop/bad cop on the North Vietnamese, and “the enemy of my enemy is my friend” triangulation on the Chinese in the same era....so maybe there is another poker play we could use. But we’re fucked if they’ve seen The Sting. 😳

@ Tom Hunter

Yep, the Americans will fuck us too...while also sanctimoniously lecturing us about the merits of free markets. As per Lee Kwan Yew’s assessment of small nations nteracting with superpowers- “whether the elephants figh5 or make love, the ants are trampled. But on balance it is better they make love.”

Tom Hunter said...

Ha! I'd forgotten Mr Yew's comment.

I also agree with Adolf on this. I have long thought that we should be trowing everything and the kitchen sink at developing trade with India. We have far more in common with them than we do with China, thanks to that "cursed" British heritage.

And in the midst of all that, maybe we could negotiate some decent 5-game, 5-day test series with the buggers as well. You never know, we might be able to persaude them that we'll pull the crowds! :)

Adolf Fiinkensein said...

Kimbo, I'm unaware of any NZ exports being given the same treatment as those from Australia. Please help me out with some detail.

Kimbo said...

@ Adolf

https://www.tvnz.co.nz/one-news/new-zealand/new-zealand-seafood-exporter-sanfords-shipments-delayed-china-ports

We have also had the same reports of Chinese students withdrawing from courses. So nothing major so far, and the Chinese Government maintains “plausible deniability” as this commentator suggests:-

https://www.newsroom.co.nz/2019/02/12/440420/nz-china-scheduling-issues-cause-for-concern

...but as when the French used trade access to pressure us to release the Rainbow Warrior saboteurs in the 1980s, the “gunboat diplomacy” signals are obvious.

Kimbo said...

...and word from a Kiwi on the ground in China who is probably being used as a conduit to present the Chinese message:

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12203882

Lord Egbut Nobacon said...

Adolf is quite wrong when he mentions "compromised equipment" In fact it is the opposite. Huawei's equipment is probably the most poked and prodded in the history of Telecommunications......no evidence of wrong doing has been found.

Adolf is is also wrong when he claims that Australia has it's own trade war. It's merely an extension of the Trump administration's trade war with China and is using it's muscle through "five eyes". The US claim of eavesdropping is without merit and unproven. In fact I would say it is nothing more than innuendo.

I'm afraid Wiggo's obfuscating tactic will not work either. Huawei is the world leader and developer of 5G and any attempt in the thousands of pages comprehensive test results required for the tender to downgrade will quickly become apparent.

The security risks found in Huawei's software by GCHQ are not malicious they are the same sort of things found accidentally in Iphones, Samsung etc. after production.

It is an information war that is being fought and we are the small player and as I said many posts ago we have to take stand...either we upset the USA or China. As the USA has proved a fair weather friend in the past and already had access to our telecom network (thank you Mr Snowden) I would go with the Chinese on this one.



Tom Hunter said...

I would go with the Chinese on this one.

Well then in this case you're an idiot and you are - as lefty, lefty, lefty Paul Buchanan summarised, actually siding with none other than the majority of the NZ Right Wing capitalists who, as he puts it, would sell their mother for the chance of trade dollars with China.

Baptists and Bootleggers.

You're suffering the same disease as Keith Locke and Chris Trotter: a pathetic inability to escape the glory days of the 1960's when sticking it to the USA was all.

Pathetic.

Lord Egbut Nobacon said...

You now becoming irritating Mr Hunter. My political bent has been well established on this blog but in the interest of ridicule you choose to ignore it.

My background is telecommunications and covered the introduction of the first Siemans digital telephone exchanges into Sth Africa.

Your opinion is just that...an opinion not a fact. Ridiculing and insulting others views are sure sign of no coherent rebuttal.

RosscoWlg said...

Kimbob.... " you acknowledge my point it was a dog they should never have purchased in the first place" Correct.... I acknowledge your point.

Due Diligence and market knowledge told them that and poor management compounded it.

Everything else you mention is a load of bullshit... socialist claptrap about market access and level playing field blah blah.

Basic business management 101 SWOT analysis, Strenths / Weaknesses/ Opportunities and Threats.

The only blame lies with Air New Zealand management and Board.

Lord Egbut Nobacon said...

Wiggo...you keep bandying around the word socialism as an insult and if it some sort disease.

Perhaps you would like to list the countries where socialism plays no part...

I tried to draw up a list of countries where capitalism played no part and failed dismally.

RosscoWlg said...

Tom I agree Eggie is still stuck in the 1960's... probably helped push the Concrete mixer down Queen Street with Shadders, cant escape his 1960's roots.."sticking it to the USA"

We don't have to take a stand at All Eggie... I can still see you cant grasp the finesse of my post or done any reading of the art of war. We are bobbing on a vast ocean we have to be flexible and circumspect.

I know most Kiwis love to think we are important and a world player but sorry mate we have to bend over and take it.

I continue to love your intellectual arrogance... don't lose it.

A friend whispered in my ear that MFAT is taking on 60 new graduates this year and their budget has blown out to $1b again. Suck on that piece of waste!
Oh by the way I used your system in Cape Town in 2017, the string between the 2 tin cans from the hotel to the airport needs replacement

RosscoWlg said...

"Stickin it to the USA" with apologies to "The Boss"

Born down in a dead man's town
The first kick I took was when I hit the ground
End up like a dog that's been beat too much
Till you spend half your life just covering up

sticking it to the U.S.A.,sticking it to the U.S.A.
I was sticking it to the U.S.A., sticking it to the U.S.A.

Got in a little hometown jam
So they put a rifle in my hand
Sent me off to a foreign land
To go and kill the yellow man

sticking it to the U.S.A., I was sticking it to the U.S.A.
sticking it to the U.S.A., sticking it to the U.S.A.

Come back home to the refinery
Hiring man said "son if it was up to me"
Went down to see my V.A. man
He said "son, don't you understand"

I had a brother at Khe Sahn
Fighting off the Viet Cong
They're still there, he's all gone

He had a woman he loved in Saigon
I got a picture of him in her arms now

Down in the shadow of the penitentiary
Out by the gas fires of the refinery
I'm ten years burning down the road
Nowhere to run aint got nowhere to go

Down in the shadow of the penitentiary
Out by the gas fires of the refinery
I'm ten years burning down the road
Nowhere to run aint got nowhere to go

Born in the U. S. A, I was born in the U. S. A
Born in the U. S. A, I'm a long gone daddy in the U. S. A
Born in the U. S. A., born in the U. S. A
Born in the U. S. A, I'm a cool rocking daddy in the U. S. A U. S. A, I was born in the U. S. A

Lord Egbut Nobacon said...

Neither informative or amusing, just cobbled together nonsense. Two of those one liners have been used previously in the Independent comments section about a year ago........the list?

Lord Egbut Nobacon said...

....the list?

RosscoWlg said...

The List....."Perhaps you would like to list the countries where socialism plays no part"

nah why would I do that... that doesn't make it correct or right. Its a disease of the 20th century, and an unfortunate side affect of people having an education that for many is not an education but a complete waste of time.

They all subscribe to that worn cliché I'm from the Govt and I'm here to help, "and if that doesn't fix it we'll give you more Govt" (the speech marks content is a Wiggoism...quite clever don't you think Eggie?)

Lord Egbut Nobacon said...

No, not clever. Just a mantra if repeated enough will take root in the mind of the less aware. It's just that your argument falls apart when you realise that socialism and social awareness plays a part in all responsible governments....even the Russia and the USA.

Your agenda is to divide.....

Lord Egbut Nobacon said...

The war escalates......the message is clear, if you don't buy American you are out of the loop. Same message passed to NZ and OZ but they just wont admit it.

https://www.independent.co.uk/news/world/americas/huawei-spying-china-surveillance-us-information-sharing-mike-pompeo-a8792446.html