Strictly unofficial business: Australia’s trade policy towards the People’s Republic of China, 1951 to 1966

Abstract

Between 1951 and 1966, Australia engaged in an expanding trade with China without extending diplomatic recognition. The Liberal–Country Coalition government not only allowed, but encouraged this connection, mostly by facilitating the exchanges of private citizens and even officials and, increasingly, providing export subsidies. It did so selectively, balancing between the eagerness of businesses and some officials, the pressure from the United States, and domestic critiques seeking either a more total containment of China or to pursue diplomacy with Beijing. By the end of the period, Canberra settled on the formula of making a sizable trade surplus with China without taking the political risk of either conducting formal diplomacy or modifying existing trade restrictions. The coincidence of needs saw the trade relationship assuming some significance in Australia’s agricultural sector, especially wheat production. But the political limitation to this trade also became clear, as did the constraints suffered by its Labor critics.

Keywords:

• Australian foreign policy
• Australian defence policy
• China
• Cold War
• economic sanctions
• trade
• United States

In November 1966, Prime Minister Harold Holt led his Liberal–Country Coalition to a crushing election victory over the Australian Labor Party, extending the conservatives’ winning streak since 1949. The public strongly supported Australian intervention in the Vietnam War which Holt’s predecessor Robert Menzies had characterised as ‘part of a thrust by Communist China between the Indian and Pacific Oceans’.¹ But even as Australian conscripts were being sent to fight alleged Chinese expansionism, steel and – more importantly – large quantities of Australian wheat, were being shipped to the People’s Republic of China (PRC) with only a fraction of the payment made upfront. Canberra was fully aware that Chinese trading firms were extensions of state bureaucracies, but authorised Australian public servants to make contacts to facilitate commercial exchanges, all the while maintaining a public position of its non-involvement, to avoid contradicting its non-recognition of Beijing and to deflect domestic and foreign (American) criticism.

Compared to Australia’s military engagement in Southeast Asia and its bourgeoning trade with Japan in the 1950s and 1960s, its economic connection across the ‘iron curtain’ during this period has been much less remembered or examined. The only published accounts dealing directly with the subject through Australia’s perspective were offered by Henry Albinski in 1965, Kevin B. Bucknall in 1983, and Chad J. Mitcham in 2005.² Albinski goes to some length in analysing the politics of the trade and critiquing the Menzies Government’s (1949–1966) handling of it, pointing out the hypocrisy in designating China a major threat to Australia, insisting on the non-official nature of the economic relationship, while allowing the exchange of private businesses and even trade officials with China.³ Bucknall’s research paper is primarily an economic survey. ⁴ Mitcham canvasses the developments in China’s trade with American allies during the Cold War and the policy responses by Washington, Beijing, and other countries, crediting Chinese leaders with orchestrating commercial competition between Western countries in the early 1960s, while arguing that the consequent trade relaxation was not sufficient to help resolve China’s developmental problems.⁵ On the other hand, China-based scholars have also produced historiography on the Australia–PRC trade in this period, almost exclusively focusing on Chinese imports of Australian wheat, reconstructing Beijing’s approach to grain imports from both Australia and Canada in the early 1960s, and presenting a clear picture of Chinese policymakers adopting a pragmatic and nimble approach in response to the famine at hand.⁶

Australia’s trade relations with China were thus not quite unique. However, in Australia’s case they sat particularly uncomfortably with the intense fear of China which the Liberal–Country Coalition cultivated and exploited to great electoral effect while maintaining a strategic containment of China. Although Mitcham’s wide-ranging archival work includes an Australian perspective, its breadth prevents a detailed exploration of this example of a US ally negotiating the sanction regime. Along these lines, an account of Sino–Japanese trade relations during the Cold War is offered by Amy King, who also addresses the contradiction for Beijing in trading with a nation whose recent history and ongoing alliance with the US rendered it a likely existential threat in the eyes of the PRC leadership.⁷

Methods and scope

The present paper draws on Australia’s governmental records, particularly the communications and deliberations within and between the Department of External Affairs, the Department of Trade (which underwent two minor name changes in this period), and the Prime Minister’s Department, to ascertain the particular ways in which the Coalition government was involved in bilateral trade relations between 1951 and 1966, and to interrogate the strategic and economic rationale behind its decisions. At the beginning of this period, the Korean War occasioned the imposition of an embargo against the PRC to which Australia subscribed, but Canberra was already diverging from American policy by this point. The year 1966 saw an escalation of the Vietnam War and Australia’s recognition of the Republic of China administration in Taiwan, complicating the politics of trade. China’s foreign trade also began to decline, especially in grain imports, occasioned by both the Cultural Revolution and strong domestic harvests.⁸ While Australia maintained trade links with the Republic of China (Taiwan), this relationship was much less politically sensitive in Australia due to the latter’s alignment with Washington in the Asian Cold War. Australia–Taiwan trade also appeared to have had little intersection with that between Australia and Mainland China. As such, it is probably better contextualised as part of an anti-Communist regional order, envisioned and pursued by some political actors in Australia, as mentioned below. But an investigation into this topic ideally extends beyond 1966, when the Holt Government established formal diplomatic relations with Taipei, signifying an intensification of bilateral connection. These considerations define the temporal and geographical scope of the present article. I focus on three issues in chronological order: the exchange of trade officials in 1956–1957, Canberra’s (in)decision on the ‘China differential’ that followed immediately after, and its policymaking towards wheat exports to the PRC. These instances epitomised the collision between Canberra’s commercial and political concerns, its responses delimiting the extent of Australia’s direct economic engagement with China. Wheat export, once it began in earnest in 1960, almost instantly became the single largest component in bilateral trade (already heavily in Australia’s favour), opened a significant market for Australian agriculture, and drew much more political scrutiny than the export of wool and steel did during the previous decade.

My study refrains from expounding on Beijing’s perspective, except for making references to it based on scholarly works produced within China. However, most of the Chinese primary sources that inform these works are found in collated materials or biographies published under the official blessing of the Chinese Communist Party (though Shang Changfeng draws on several documents from the Chinese Foreign Ministry’s archives).⁹ Therefore it is likely that a rather extensive quest for Chinese archival material must be conducted – which promises no definitive outcome, not least because the archive of the PRC Ministry for Foreign Trade seems not to have been made available to the public – before one could attempt to trace a more comprehensive picture of China’s trade policy towards Australia during the same period. My article thus addresses the inner logic and conduct of Australian policy, which hopefully lays a foundation for future works on the interplay between the two governments in this period.

Keeping options open

Trade with the PRC was laden with geopolitical implications from the outset. As the Communists were poised to win the Chinese civil war in July 1949, Washington was considering drastic trade sanctions against the emerging government, which the Chifley Labor government vigorously opposed in private. For, should the long-established Sino–Japanese economic nexus be severed, Japan would again turn to Southeast Asia and the South Pacific for raw materials and markets, intruding on the economic sphere of the British Commonwealth.¹⁰ Indeed, in 1952, Canberra still saw ‘economic and political advantage of permitting a reasonable interchange of goods between Japan and China to minimise Japanese pressure for concessions in other areas’.¹¹ With China’s intervention in the Korean War, the Truman Administration managed to have the UN impose an embargo against China of ‘strategic goods’ from May 1951. However, concerned that this would further aggravate Beijing, the Menzies Government worked strenuously to dissuade the US from pursuing sanctions and even considered refusing to commit to proposed measures.¹²

Economic self-interest, however, was also a powerful motive for Canberra. The Department of Trade (henceforth Trade or DoT, including its various incarnations) strongly pushed for having individual UN member states retain the discretion on determining specific items, as the alternative was to have Washington’s austere measures writ large. The Cabinet decided to only restrict exports pertaining to ‘war capacity’, administered ‘without open discrimination’ to avoid antagonising Beijing, whilst maintaining ‘allowance … for the expansion of trade’. ¹³ The only identifiable governmental initiative to that end, however, came from Canberra’s bureaucracy. Once the prospect of an armistice in Korea became tangible, in November 1951, the Comptroller-General of Trade inquired of the Department of External Affairs whether Australia could claim the benefit of most-favoured-nation status vis-à-vis the PRC, on the basis of a treaty between the UK and the then Chinese Nationalist government in 1928. After over two years of delay, London confirmed External Affairs’ initial suspicion that the treaty did not directly concern Australia.¹⁴ The lack of haste aside, there was a willingness in Canberra to compartmentalise political and commercial concerns.

In any case, it was doubtful that the Communist government in Beijing would have been keen to salvage a 1928 treaty for the sake of a minor power it was fighting in Korea. Its priority in the early 1950s was to build up trade with the Soviet bloc and nurse its war-ravaged domestic economy, neither of which placed much demand for commodities offered by Australia.¹⁵ Simultaneously, the Korean War boom seemed to negate the need for Australia to seek new markets behind the Iron Curtain, before giving way to a commodity downturn.¹⁶ Already in March 1952, the government had to implement import restrictions to stabilise balance-of-payments.¹⁷ Australia’s industrial sector also began to run into the lacklustreness of domestic demand.¹⁸ With its vast population and urgent developmental needs, China had obvious potentials as Australia’s new customer.

A tale of two Menzies

Beijing was no less keen to expand its trade with Australia. From 1954, likely with both diplomatic and economic imperatives in mind, the Chinese leadership began a concerted effort to promote trade with advanced capitalist economies.¹⁹ In late 1955, Harry Menzies, Australia’s Trade Commissioner to Hong Kong, helped arrange two officials from the China Resources Company, a state-owned trade firm, to visit Australia to inspect production facilities and conclude purchase contracts. The trade commission, subordinate to the DoT, usually operated to facilitate commercial contacts and trade exhibitions, but the branch in Hong Kong also served as a point of contact with PRC entities in the absence of Australian representation in Mainland China. While he considered trade ‘the play-thing of politics’ for Beijing, Menzies accepted the invitation of the China Resources Company to visit the PRC in the following March, engaging in talks with Chinese corporations and central government officials in Beijing – including Chinese Premier Zhou Enlai.²⁰ Zhou expressed hope that ‘trade might be the bridge to the resumption of normal relations’, but otherwise limited himself to commercial discussions. Menzies left with the impression that Beijing was anxious to increase trade with Western nations, and was particularly encouraged by Chinese interest in Australian agricultural machinery, opining that Australia could have ‘a flying start with China’ here as the US continued its embargo. Menzies suggested that Australia establish a trade commission in Beijing, which he believed the Chinese would welcome.²¹ The trade commissioner’s political scepticism towards China and enthusiasm for its commercial value blended perfectly. Menzies even suggested to Chinese officials that they moderate their studied pursuit of bilateral trade balance by, instead, maintaining an overall balance with the whole of sterling area – the group of countries, including Australia, whose currencies were fixed against the British sterling. This apparently came as a novel idea to them.²²

In December 1956, China’s Ministry of Trade approached Menzies over a larger Chinese commercial delegation. The DoT was ‘anxious to push ahead trading with Mainland China’ by facilitating such contacts.²³ While opinion within External Affairs was mixed, the Acting departmental secretary James Plimsoll advised the minister, Richard Casey, that if Washington protested the visit, Canberra could reassure it that ‘we do not intend to break down the embargo [on strategic goods] nor is our attitude towards recognition involved’.²⁴ This would become the basic formula for the government’s approach to trade.

After some hesitation by the Cabinet and another Chinese initiative,²⁵ John McEwen, then deputy leader of the Country Party and Minister for Trade, took up the issue with a cautious Casey. Designating China ‘one of the world’s most promising’ markets for wool products, he told Casey that Beijing’s displeasure with Canberra’s restrictive import policy had cost some Australian businessmen access to China, and might lead to cut-backs in Chinese purchases. McEwen believed it ‘desirable that we make some favourable gesture to the Chinese to retain their commercial goodwill’.²⁶ On 11 April, the Cabinet approved the trade mission.²⁷

At this point, however, Beijing held up the trade mission and denied visas to Australian business visitors, pressuring Australia to relax the ‘China differential’ – the discrepancy in the degree of trade restrictions towards the PRC versus the Soviet bloc, exercised by mostly NATO countries under a consultative arrangement called the ‘Paris Group’. ²⁸ Though not part of the group, Australia had aligned with its policy in consideration of American attitudes. After years of reluctant compromises with Washington, the UK abolished the ‘differential’ in June 1957.²⁹ Prime Minister Menzies was initially sanguine about Australia following Britain without substantial backlash from Washington, but appeared to have been dissuaded by Casey.³⁰ The Australian embassy in Washington, taking encouragement that Japan was slated to obtain US acceptance that it would ‘unobtrusively abandon [the] differential’, likewise believed that the Americans would accept a similar move by Canberra if handled carefully.³¹ However, there was significant pressure from within the Liberal Party and Democratic Labor Party (DLP) against easing trade sanctions.³² The latter, composed of anti-Communist breakaway elements from the Australian Labor Party (ALP), would retain its outsized political significance for at least another decade.

While Washington did not seem to pressure Canberra over the ‘China differential’, it did express concern over bilateral visits. A US embassy official warned that ‘if a country as firmly attached to the Western group as Australia allowed prominent visitors from China, this would have an effect on South East Asian countries’. He also complained that ‘when Mr. H.C. Menzies visited Beijing a lot of people thought that the Prime Minister of Australia had gone there and this was unfortunate’.³³

American inattentiveness to their antipodean ally aside, it was the case that trade had become entangled with politics in Australia. The more liberal Australian newspapers – The Age and the Canberra Times – editorialised in favour of trade relaxation as part of a general détente with the PRC.³⁴ But high politics weighed in the other direction. In July, a parliamentary committee, comprising of members from the Coalition and the DLP, expressed deep scepticism of the benefits of easing the embargo, and warned that commerce was the ‘thin edge of a wedge’ by Beijing to seek diplomatic recognition.³⁵ Although some in External Affairs advocated for relaxation, and although all ‘Paris Group’ countries had decided to abolish the ‘China Differential’ by August, Casey insisted that Canberra ‘should do nothing, even if only of propaganda value, to encourage support of the [Chinese] regime in South East Asia’, which, he believed, would not justify the commercial gains.³⁶ External Affairs even floated stationing an Australia trade commissioner to Taiwan, but was vehemently opposed by DoT Secretary John Crawford, who suggested a compromise of dispatching trade commissioners to Taipei and Beijing simultaneously.³⁷ This was a retreat from an earlier position, when Trade had been preparing a plan of ‘unobtrusively putting a Trade man in [Beijing] and thereby doubling our exports to the mainland’.³⁸ The imperative of geopolitics now took precedence.

It was not until March 1958 that the Chinese side renewed the initiative, repeatedly approaching the Trade Commission in Hong Kong on the viability of another visit. Despite his interlocutors’ insistence otherwise, Commissioner K.T. Ridley suspected that the initiative originated from the Chinese government itself.³⁹ The obsession over a non-political appearance was shared, as the departments of Trade and External Affairs resumed coordination about the protocol for the visit in a cloak-and-dagger mode, to ensure a strict informality of engagement with the visitors. A senior Trade official, E.P. McClintock, suggested having ‘appropriate [Trade] officers find it convenient to be in Sydney or Melbourne at the right time, talk to them there and so obviate any necessity for them to come to Canberra’, and to receive the Chinese as ‘normal business visitors’ rather than government officials, which allowed the department to provide assistance.⁴⁰ External Affairs approved of having junior and state-level officers engaging with the visitors. It also supported McClintock’s suggestion and gave Trade an unsubtle wink: ‘We see no reason why Mr. McClintock should go out of his way to either seek or avoid contact with the Mission’.⁴¹ The DoT’s final guidelines stipulated: the Chinese should not be met at the plane on arrival, junior personnel accompanying them must remain within the particular cities, and participants should ‘unobtrusively and merely incidentally’ probe Chinese attitudes about hosting an Australian trade post in Beijing.⁴²

Such duplicity was not uniquely Australian – the Australian ambassador in Tokyo observed that the Japanese government had been at least consulted over the ostensibly ‘private’ commercial agreements with China, expressing disapproval of Tokyo’s tendency ‘to try to secure the best of somewhat incompatible worlds by smiling in all directions in the hope that political leaders in other countries will fail to see obvious inconsistencies in policy’. Japanese diplomats could have said the same of Canberra. And Tokyo was arguably more forthcoming with its calculus – a year later, Japanese foreign minister briefed Casey on Beijing’s economic and political influence in Southeast Asia, before opining that it was nonetheless important to have dialogues with China and bind it into international agreements.

For now, the Chinese delegation was reportedly underwhelmed with their visit, particularly disappointed with the terms of sales offered by the Australian Wheat Board (AWB), a statutory body, semi-independent from the Federal government and monopolising all domestic and international wholesale of wheat.⁴³ At the time, China had begun importing wheat and food products from France and Canada in some quantity.⁴⁴ They were likely also disappointed in Canberra’s refusal to abolish the ‘China differential’. By May 1958, both External Affairs and Casey himself had become more optimistic on this front. A Cabinet submission by Casey put forward a moderately favourable case for it, noting that whereas America had not punished its allies for abolishing the ‘China differential’, Beijing might retaliate by cutting imports from Australia.⁴⁵ The Cabinet, however, delayed the decision once again until next year,⁴⁶ which must at least partly be attributed to concerns for the general election in late 1958.

The conservatism also seemed justifiable when Australia was already exporting some goods kept under watch by the Paris Group (but not prohibited), though it lagged well behind Japan in commencing these exports and in the variety of goods exported.⁴⁷ Since the inception of regular though small shipments of steel to China in 1956, Canberra consulted with Washington before approving every sale, while the US never seemed to explicitly object to it.⁴⁸ Between 1956 and 1959, iron and steel products accounted for the majority of the growth in trade with China. Nonetheless, the more advanced Japan was the primary focus of Australia’s trade expansion.⁴⁹ This was partly driven by Washington raising trade barriers on several crucial dollar-earning commodities for Australia. Also causing grief was its application of American embargo rules on foreign subsidiaries of US corporations. After learning of the carve-outs obtained discreetly by Canada, the government managed to have Washington agree to some minor concessions too.⁵⁰ A flexibly administered sanction regime suited both governments.

‘Political content’ of wheat

Developments in China did bring a windfall for Australia, though not in the way Harry Menzies envisioned. The catastrophic agricultural failures caused by the ‘Great Leap Forward’ impelled Beijing to begin importing large quantities of grains. Chinese purchases of Australian wheat had been negligible until 1958. However, in early December, 1960, Mao Zedong gave his approval to import one million tons of grain, enabling his deputies to move quickly and have a deal struck between China Resources and the Australian Wheat Board before the month’s end; as the Soviet Union and France had little surplus on offer, Canada was also approached once Beijing decided to expand the import volume.⁵¹ In February 1961, the first shipment from Australia arrived in China to immediate, salutary effect.⁵² Chinese purchases from Australia then skyrocketed, resulting in a one-third increase of Australian production from 1961 to 1964, with only a quarter of the commodity consumed domestically. By mid-1964, the cumulative proceeds from this trade reached £250 million, or an annual average of about £70 million. This made up approximately 5 per cent of Australia’s goods export earnings in the financial year 1963–64.⁵³

The Menzies Government was closely involved in managing this trade. For one, it greenlit two-way visits between the two countries’ public servants as an essential corollary. By January 1961, as exports to China soared, H.C. Coombs, Governor of the Reserve Bank of Australia (RBA), visited the People’s Bank of China as part of a common practice of exchange ‘with reserve banks of countries with which Australia carried on trade of any size’.⁵⁴ Coombs had sought the approval of Menzies who was overseeing External Affairs. Menzies not only agreed – apparently before consulting the department – but also told the departmental secretary that ‘careful relaxation of our economic and financial relations with Communist China was worth pursuing, whatever the (Australian) position on recognition’.⁵⁵ The Cabinet then approved the RBA’s invitation to the head of its Chinese counterpart in May 1962.⁵⁶ Australia’s trade commissioner to Hong Kong, G.R.B. Patterson, sought External Affair’s authorisation to attend the Canton Trade Fair in April 1961. The approval came with the proviso that he did not use an official passport, but (paradoxically) maintain that this visit was part of his ‘normal’ official function.⁵⁷ The fact that Patterson reported directly to External Affairs for this matter, rather than to the Trade Department, betrayed the government’s understanding that the visit was anything but ordinary.

The Australian Wheat Board also quickly came to allow the China Resources Company to make purchases on credit, which was somewhat grudgingly given as a result of competition with other countries carefully orchestrated by Beijing. To be sure, the PRC was staring down a precariously small foreign exchange reserve for its import needs.⁵⁸ Still, as China’s Minister for Foreign Trade told Premier Zhou Enlai after a mission to Hong Kong around the beginning of 1961, Australia (and the US) was anxious to sell off its surplus grain, confident that business interests would help overcome political obstacles. Premier Zhou Enlai personally supervised the procurement and transport processes.⁵⁹ In February 1961, Chinese commercial agents approached the Australian Wheat Board (AWB) for more purchases, this time on credit terms of 6–12 months. The Board was initially hesitant if not outright dissatisfied with the terms.⁶⁰ However, both McEwen and Menzies likely supported it, and on 2 March the Cabinet agreed that ‘there would be no political objection’.⁶¹ Adding to Australian urgency, the next day, the Canadian government divulged (a week after the fact) that a Chinese importer had approached the Canadian Wheat Board for an even larger credit arrangement.⁶² Initial attempts by Canberra and Ottawa to maintain consultation soon gave way to intense commercial competition, no doubt helped by Chinese officials carefully siloing the two bilateral negotiations from each other.⁶³ The Canadian Wheat Board was reportedly ‘most bitter’ about being undercut by Australia’s offer.⁶⁴

While the commercial logic was undeniable, it was a conscious choice by the Menzies Government to prioritise economic benefits over its other political and strategic concerns. Anticipating American objection, McEwen told Menzies that ‘if any American disapproval of the provision of wheat were voiced to us and leaked out, nothing but harm could come to America’s international reputation and standing’ given the famine in China. He also believed that the Australian public would overall not oppose the export of wheat. Moreover, the ‘broad Australian viewpoint is to hope for a betterment of relations with Communist China with a consciousness that it is against the national interest that these relations should be worsened’.⁶⁵ For McEwen, a permissive policy on wheat exports not only made good commercial sense, but promised a diplomatic dividend eventually, and there was no evidence that Menzies demurred. The use of credit was not unique to Australia – NATO countries had agreed to extend up to 12 months of credit to Soviet-bloc importers in 1959. After the first deferred-payment Australian wheat sale was signed in May 1961, Tokyo sought Canberra’s views on China’s credit-worthiness, evidently heartened by Australian experience.⁶⁶ The Menzies government also did not prevent the state-owned Commonwealth Trading Bank from underwriting wheat sales, an example used by Japanese businesses to criticise Tokyo’s more restrictive financing rules.⁶⁷ Without explicit coordination, an international standard on trading with the PRC was emerging.

Throughout 1962, with escalation in Vietnam, the US exerted pressure on Canberra over its trade with China. In mid-January, the Australian ambassador in Washington, Howard Beale, was called into the State Department alongside his Canadian counterpart to discuss the issue with senior US diplomats, who urged their governments to consider pressuring China with the grain exports, especially in the event of ‘communist China moving into the Vietnam situation’. The two guests pushed back, obtaining some minor compromises from the Americans such as forewarning Beijing of such actions. Beale and the Department of External Affairs concluded that Canberra could agree to having a joint tripartite dialogue (with the US and Canada) on the questions of Chinese activities vis-à-vis Vietnam, which would be approached with ‘a critical eye’ with no commitment to a policy change.⁶⁸

The Menzies Government even tried to bargain for better access to American strategic policymaking vis-à-vis China. It insisted to Washington that restrictions on wheat export ‘would not significantly affect the military capacity’ of the PRC, since China had alternative suppliers and remained largely self-reliant. Simultaneously, its intelligence indicated the PRC’s military and industry had indeed suffered from the food shortage.⁶⁹ The inevitable conclusion is that Canberra perceived Chinese military power as rather limited, and its reservations on trade was largely due to political and diplomatic concerns.

Ultimately, neither Washington nor Canberra gave in. At the 1962 ANZUS meeting, Australia’s External Affairs’ minister Garfield Barwick reiterated to US Secretary of State, Dean Rusk, that the Australian government ‘had not been involved’ in the trade, having neither directly provided credit nor insurance against default.⁷⁰ Even with the Sino–Indian border war later in the year, Canberra was unmoved, and indeed found comfort in its competitor, Canada, taking a similarly obdurate stance.⁷¹ In mid-January, the US made one more attempt. Appealing to the Australian’s economic mind, its Canberra embassy warned External Affairs that Beijing could increase its demand for credit and access for Chinese exports. In Washington, Rusk told Beale that in light of the recent PRC military victory over India, the wheat trade now had ‘a political content’, and requested that the wheat sale ‘be examined very closely’ if fighting resumed. Beale stood firm, stating plainly that a unilateral Australian embargo ‘seem to me politically out of the question’.⁷² Jolted by renewed American pressure, Barwick suggested to McEwen that the Cabinet ‘consider our position and the arguments which we would employ with the United States’, as well as noting that Washington would consider credit terms over 12 months as effectively ‘economic aid’. McEwen, however, was far less amenable, insisting that Australia’s wheat export be considered alongside NATO countries’ trade with China and concluded that the government could not ‘do more than note the comments of Mr. Rusk’. Barwick still proposed an inter-departmental study of the question but reassured McEwen its aim was merely to ensure the consistency and robustness of the government’s statements.⁷³ He was not going to pick a fight with the Country Party over the lucrative wheat business.

Still, External Affairs was sceptical of the trade for reasons other than US–Australia relations. A late-1962 report noted that Beijing was haemorrhaging foreign reserves in the previous year, which was partly being remedied through the use of credit. The paper also called for a decision on whether the trade would be planned for the long term, with the attendant entrenchment of the Australian wheat industry’s capacity, and warned about the risk of drifting into economic dependency on China.⁷⁴ This was not entirely implausible – another internal report observed that Australia supplied only around one-fifth of China’s grain imports, less than one per cent of its total consumption.⁷⁵ As External Affairs recognised, this asymmetry meant that a unilateral embargo by Australia would simply see other countries’ export to China making up the shortfall.⁷⁶ The grain trade was therefore subject not to the imperative of Cold War containment but the logic of market competition. By March 1963, External Affairs had come to terms with the status quo.⁷⁷ It did oppose the extension of credit terms beyond 12 months – which the Chinese buyers began to seek in April – on grounds of US opinion. The Treasury also opposed this for financial concerns.⁷⁸

The government decided against the extension after some hesitation. But as Albinski pointed out, its conservatism was explicable in light of its one-seat parliamentary majority and its uncertain prospects in the upcoming election.⁷⁹ With this, the Liberal–Country Coalition Government had settled upon a policy of continued wheat sales on maximum 12-month credit for as much as China would buy, balancing itself between the demands of its American ally, the rural constituency, and the anti-Communist critics whose electoral support it needed. The government even tolerated the situation whereby Beijing made a profit from Australian wheat – either by directly re-exporting it or replacing rice with wheat for domestic consumption, saving rice as a higher-value commodity for export. Later in the year, the China Resources Company approached Patterson to inquire about wheat purchases on behalf of Eastern European states – to which, the Chinese liaison admitted, the company had been sending some of the grains purchased on credit from Canada. Patterson thought this needlessly expanded the size of credit, and suggested that ‘future deals … specify that the wheat should be for China only’.⁸⁰ There were no signs that the government had any political objection to the scheme. By mid-1962, some parliamentarians began raising questions, and the government strenuously obfuscated on the answers. It was not until April 1964 that it disclosed the quantities of wheat involved in re-exporting – only a fraction of China’s total purchases.⁸¹ Chinese sources suggest that, having intentionally exploited the price difference, between 1961 and 1965, the PRC had made a net ‘profit’ of about 5.5 million tons of grain for a total of 27.4 million tons of imports.⁸²

Australia’s vicarious support for this scheme seemed to have eluded domestic and foreign critics’ attention, as did the subsidy that the Commonwealth government provided to wheat exports through a price stabilisation fund, which provided guarantees against international price fluctuations. When the producers’ contribution to the fund ran dry – as happened in 1959 – the government paid into the fund. By 1963, it had provided about £27.5 million. With 40 per cent of Australian wheat exports going to the PRC, the latter’s share of this subsidy would have amounted to about £10 million, against the £127 million in payments from China between 1960 and 1963. The government was even, reportedly, prepared to use the stabilisation scheme as a de facto insurance for sales on credit.⁸³ To be sure, the subsidy was hardly noticeable in the Federal government’s annual expenditure at over £1,400 million.⁸⁴ When, in 1965, Labor opposition picked up the issue in parliamentary debates, the apologia by the Minister for Primary Industries, Charles Adermann, revealed Australia’s dilemma: it was the increased agricultural subsidies from Canada and the US for their producers that depressed international prices.⁸⁵ This perhaps explain why Washington did not raise the issue with Canberra – unless the latter would agree to forego the sizable China market altogether, it had no choice but to sell the commodity according to a low market price, to which Washington’s own agricultural policy contributed.

The government did have to contend with a variety of domestic dissent. The hard-line Liberals were fewer in number but, when the Coalition had a mere one-seat parliamentary majority in 1961–63, their influence demanded careful handling, though Menzies and his successor Harold Holt ignored their calls for wheat embargo.⁸⁶ The DLP decried the government’s permissiveness on trade with China as ‘pure greed and inhumanity’. It also warned of the risk of Beijing weaponising the trade for its geopolitical aims, and advocated for an anti-communist organisation of Asia–Pacific states, which would serve not only as a military alliance but a trade network that would obviate any need to engage with the PRC economically.⁸⁷ There was, in fact, a grain of truth in the DLP’s view – Zhou Enlai himself reportedly attached much diplomatic significance to trade relations with America’s allies, with the hope of exploiting their differences with Washington and breaking the strategy of containment.⁸⁸

The ALP attacked the government for hypocrisy – professing its commitment to containing China without weaponising trade – but its criticism was not entirely consistent. Some Labor parliamentarians sought to outflank the government on national security, labelling them ‘modern day Judas Iscariots … the people who are more concerned with dollars than perhaps with the lives of people’.⁸⁹ Others, including its leader Arthur Calwell, eventually settled on advocating for expanded trade alongside the party’s long-standing policy to recognise Beijing.⁹⁰ Its own insiders admitted that an ALP government, in the early 1960s, would have largely continued the trade policy.⁹¹ Indeed, polling indicated strong public support for the continuance of limited trade with China, which seemed impervious to the geopolitical crises in the late 1950s and early 1960s.⁹²

From mid-1964, the wheat subsidy began to attract some public criticism. Responding to the correspondence of a Monash University academic, External Affairs admitted that the credit terms for China were uniquely favourable, but stated that the wheat sold was of lower quality and seasonality was another key factor in pricing. It maintained that any unilateral embargo against China would ‘have a severe effect on our economic development’ without doing much damage to the PRC.⁹³ In 1965, the ALP picked up the pricing question in parliamentary debates. Labor MP Wilfred Coutts sought to embarrass the Country Party by claiming that wheat being sold to China was at a ‘very depressed price’ compared to that sold to ‘our brothers in the United Kingdom’; another, Patrick Galvin, claimed that China was buying Australian wheat 10 per cent below cost.⁹⁴ Yet the ALP itself offered no alternative solution to the pricing problem, perhaps recognising the severe limitation for Australia in a global commodity market.

Labor faced a larger quandary – at precisely the moment when its criticism became more cogent, its position on recognising the PRC was drowned under the high tide of public support for a war in Southeast Asia to forestall alleged Chinese expansionism. In May 1965, speaking against the government’s decision to dispatch Australian combat forces to Vietnam, Labor leader Arthur Calwell argued that ‘the true nature of the threat from China is not military invasion but political subversion’ and that the government’s trade and defence policies were morally inconsistent. He called for settlement – and if necessary, military intervention – to be conducted through the United Nations.⁹⁵ A more detailed exposition of Labor’s policy on the China trade came one year later from a young backbencher, Bill Hayden, who accused the government of cultivating jingoism, turning foreign policy into a ‘loyalty test’, and wrapping its policies in dishonest slogans. On China, he dismissed ‘the fearful spectre of this huge country of 700 million people all of whom are going to flood down onto Australia’, pointing out that China’s military was geared towards home defence, and observed that American opinions were increasingly prepared to acknowledge China’s fears and interests. Turning to the wheat stabilisation scheme, Hayden had no doubt that ‘Australian taxpayers are subsidising wheat sales to Communist China’, but made it clear that in ‘question[ing] the sincerity of the assumptions upon which the Government bases its arguments’, he favoured increasing trade with the PRC. He articulated Labor’s Asia policy in explicitly internationalist terms – settling the Vietnam War via negotiations with Moscow, Beijing, and the major Vietnamese factions.⁹⁶ And, as mentioned above, others in the ALP continued to attack the Coalition for compromising on trade. But neither calm reasoning nor hawkish indignation helped the ALP avoid a landslide defeat in the election in late 1966. As the US seemed committed to a military victory in Vietnam, the Australian public proved largely content with the deftly administered policy equilibrium, between commodity export to the PRC and fighting its alleged expansionism on Australia's doorsteps.

The Holt Government reaffirmed its predecessor’s circumscribed liberal approach. In March 1966, in deciding to approve the visit of another Chinese business delegation. The cabinet accepted Charles Adermann’s reasoning that China’s share of Australian wheat exports made it important to maintain good commercial relations with Beijing. He was concerned that, having denied the Chinese an opportunity to negotiate wheat contracts in Australia the previous year, another rebuff would further diminish any goodwill left. Aderman also pointed out that Chinese consumption had helped sustain wheat prices, ultimately reducing the amount of government subsidies to the price stabilisation scheme.⁹⁷ A few weeks later, the Cabinet adopted a guideline for defending its trade policy, which both solidified Canberra’s position and revealed its contradictory quality. It referred to the asymmetry of the commercial relationship, admitted that the foreign exchange Australia earned from China was also supporting its ‘defence needs’, and characterised the trade as part of the ‘patient efforts to establish the basis of living with Mainland China’.⁹⁸ These arguments, however, were largely absent from the Coalition’s public rhetoric.⁹⁹ Its success in balancing electoral, diplomatic, and (highly selective) commercial interests was thus predicated a level of obfuscation and a coincidence of international circumstances, where other American allies and indeed China itself acquiesced with the heavily constrained trade relations and the disavowed official involvement.

Conclusion

The spectacular take-off of Australian wheat exports to the PRC was part of the bilateral trade relationship that had been assiduously and discreetly cultivated by the Liberal–Country Coalition in government. Between 1951 and 1966, it facilitated aspects of the trade through administrative and financial measures, exploiting but never overstretching Washington’s tolerance of the ‘non-strategic’ exports by its allies, and carefully maintaining a somewhat deceptive appearance of its official non-involvement. It paid close attention to the endeavours of other countries, especially Canada and Japan, as they were both commercial competitors and collaborators against Washington’s attempt to organise a more totalising economic containment regime. Beijing, for its part, mostly welcomed the dissociation between trade and politics as well, though its sensitivity to the discriminative restriction measures was well-understood by key policymakers in Canberra. By 1966, the Coalition had settled on a formula that allowed the best of both worlds – anti-Communist politics and foreign policy on the one hand, lucrative trade with ‘Red China’ on the other.

What emerged between China, Australia, Canada, and Japan in this period was effectively a collective challenge to the trade sanctions expected of American allies. But with little evidence to suggest any deliberate coordination with other governments, the Coalition’s approach to the trade was overall reactive. It re-examined the ‘China differential’ only when Beijing’s displeasure became obvious, and even then avoided drastic reforms. It defended the wheat trade from domestic and American pressure, but made no serious attempts at establishing a more permanent understanding with Washington or to make its reasoning fully public. Ultimately, it handled the trade relationship with China in a way which complemented the containment strategy – if not so much as using Chinese payments to import weaponry, then at least minimising the economic cost of the Cold War and sustaining a staunchly supportive domestic political coalition. Defying both its more alarmist domestic critics and Beijing’s hopes – though it remains unclear whether Australia stood out among US allies for this purpose – Canberra found it relatively easy to cordon off trade from geopolitics.

This policy became harder to maintain when Beijing moved to leverage trade for diplomatic purposes more aggressively. In 1970, as Canadian and Italian governments established diplomatic relations with the PRC, Beijing called off a new contract with the Australian Wheat Board. Communicating through back-channels, it attributed its decision to Canberra’s foreign and defence policy.¹⁰⁰ And in April 1971, when Gough Whitlam, as the opposition leader, reached out to Zhou Enlai to seek a visit to Beijing, he explicitly invoked the trade restrictions as an issue which his alternative government could solve.¹⁰¹ But Whitlam’s primary focus, as evidenced by his later pronouncements, was the political détente with Beijing, giving trade no more than passing references.¹⁰² And it should be noted that the Country Party’s leaders refrained from calling for an outright recognition of the PRC despite their proximity to the wheat producers.

By joining other countries in trading with China, Australia did effectively help broaden Beijing’s options in economic policy. China orchestrated competition among grain exporters, but was compelled to effectively follow Harry Menzies’ advice on bilateral trade deficits – between 1956 and 1966, it ran a fluctuating but persistent trade deficit with Australia, whilst maintaining a minor overall surplus in most years.¹⁰³ Well before the Sino–American détente in the 1970s, therefore, the PRC had been actively participating in the capitalist international market, with Canberra’s ambivalent assistance.

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No potential conflict of interest was reported by the author.

Additional information

Notes on contributors

Fangcheng ‘Frank’ Yuan

Fangcheng ‘Frank’ Yuan holds a PhD in history from the University of Sydney. His thesis examines Australia's policy towards China between 1949 and 1990.

Notes

1 Robert Menzies, ‘Vietnam. Ministerial Statement’, Commonwealth Parliamentary Debate (CPD), House of Representatives (HR), 29 April 1965, Historic Hansard, https://historichansard.net/hofreps/1965/19650429_reps_25_hor45/.

2 There is also a master thesis on the subject by Tadashi Saito, ‘Trade without Diplomatic Relations: A Comparative Study of China–Japan and China–Australia Trade Relations in the 1960s’ (Master thesis, Australian National University, 1988), https://openresearch-repository.anu.edu.au/bitstream/1885/128709/2/b16593893_Saito_T.pdf.

3 Henry S. Albinski, Australian Policies and Attitudes toward China (New Jersey: Princeton University Press, 1965), 249–348.

4 Kevin B. Bucknall, ‘Australia–China Trade’, Research Paper, Centre for the Study of Australian–Asian Relations, Griffith University, March 1983.

5 Chad J. Mitcham, China’s Economic Relations with the West and Japan, 1949–79: Grain, Trade and Diplomacy (Oxford: Routledge, 2005), 218.

6 Li Jie-chuan, ‘The Great Significance of Sino-Canadian Wheat Trade in the 1960s to China’, Contemporary China History Studies [当代中国史研究] 12, no. 2 (2005), 88–94; Shang Changfeng, ‘Impact of Grain Imports in 1961 on China’s Foreign Trade’, Contemporary China History Studies [当代中国史研究] 17, no. 3 (2010), 72–78; Qu Shang and Xu Tiancheng, ‘China’s Grain Imports from Canada and Australia from the Autumn of 1960 to May 1961’, Contemporary China History Studies [当代中国史研究] 24, no. 4 (2017), 110–8; Xie Xiao-xiao, ‘Sino–Australian Exchanges Before Establishing Diplomatic Relations: Australians in Shanghai, 1949–1965’, Historical Review [史林] (2021), no. 3, 157–67; Xiong Huayuan, ‘How Zhou Enlai Led the Efforts in Overcoming Food Difficulties in the Early 1960s’, [20 世纪 60 年代初周恩来如何领导克服粮食困难], Literature of Chinese Communist Party [党的文献] 28, no. 3, (2021): 87–93; Xiong Hui and Tan Shi-jie, ‘On the Work of China’s Food Imports in the 1960s’, Journal of Xiangtan University (Philosophy and Social Sciences) [湘潭大学学报 (哲学社会科学版)] 37, no. 3, (2013): 138–144.

7 Amy King, China–Japan Relations after World War Two: Empire, Industry and War, 1949–1971 (Cambridge: Cambridge University Press, 2016).

8 Jason M. Kelly, Market Maoists: The Communist Origins of China’s Capitalist Ascent (Cambridge, MA: Harvard University Press, 2021), 189.

9 Shang, ‘Impact of Grain Imports in 1961 on China’s Foreign Trade’, 76.

10 Cablegram, Department of External Affairs (DEA) to Secretary of State for Commonwealth Relations, London, no. 117, 11 July 1949, National Archives of Australia (NAA): A1838, 766/1 Part 1. Unless otherwise specified below, ‘Canberra’ refers to External Affairs as the sender or recipient of cablegrams, other national capital names refer to Australian diplomatic postings there, while ‘Hong Kong’ refers to Australian Trade Commission in Hong Kong.

11 Canberra to Washington, no. 853, 25 July 1952, NAA: A1838, 766/3/4 Part 1.

12 For example, Canberra to the Australian Delegation to the United Nations General Assembly, no. 12, 18 January 1951, NAA: A1838, TS852/20/4/3 Part 1.

13 Arthur Tange, memorandum for secretary of Department of Commerce and Agriculture, 12 February 1951; A.S. Brown, memorandum for Cabinet Submission no. 100B, 14 March 1951; John Crawford, memorandum for secretary of DEA, 2 April 1951; S. Jamieson, record of conversation, 26 June 1951, all NAA: A621, S789 Part 1.

14 J.W.C. Cumes, draft memorandum for Comptroller-General, DoT, 19 December 1951; F.A.K. Harrison to F.B. Cooper, 24 April 1954, both in NAA: A1838, 766/1 Part 1.

15 Albinski, Australian Policies and Attitudes toward China, 258; Xin-zhu J. Chen, ‘China and the US Trade Embargo, 1950–1972’, American Journal of Chinese Studies 13, no. 2 (2006): 169–186, 174–181.

16 Richard Pomfret, ‘Reorientation of Trade, Investment and Migration’, in The Cambridge Economic History of Australia, ed. Simon Ville and Glenn Withers (Port Melbourne, Victoria: Cambridge University Press, 2015), 398; Stuart Ward, Australia and the British Embrace: The Demise of the Imperial Ideal (Carlton South, Vic: Melbourne University Press, 2001), 22.

17 Stuart Ward, Australia and the British Embrace, 22.

18 Diane Hutchinson, ‘Manufacturing’, in The Cambridge Economic History of Australia, 301.

19 Kelly, Market Maoists, 112–116; Amy King, ‘China’s External Economic Relations during the Mao Era’, in The Cambridge Economic History of China: 1800 to the Present, Volume 2, ed. Debin Ma and Richard von Glahn (Cambridge: Cambridge University Press, 2022), 700–702; 112–116.

20 H.C. Menzies, minute to DoT secretary, 28 May 1956; H.C. Menzies, letter to Assistant Secretary of DoT, 16 January 1956; Departments of Trade and Primary Industries to the Australian Trade Commission, Hong Kong, O.2589/90, 23 February 1956, all NAA: A1313, 1960/7735.

21 H.C. Menzies, minute to DoT secretary, 28 May 1956, NAA: A1313, 1960/7735.

22 Ibid.; H.C. Menzies, draft report, c. May 1956, NAA: A1313, 1960/7735.

23 Record of conversation with Mr. Bassett, 14 December 1956; Economic Relations Division, DEA, memorandum for Mr. Arnott, 27 December 1956; G.P. Phillips, memorandum for the Secretary of DEA, 20 December 1956, all NAA: A1838, 766/1/3 Part 1.

24 Keith Brennan, memorandum to James Plimsoll, 11 January 1956; James Plimsoll, memorandum to the Minister for External Affairs, 16 January 1957, both NAA: A1838, 766/1/3 Part 1.

25 A.H. Loomes, memorandum to Minister for External Affairs, 11 April 1957, NAA: 1838, 766/1/3 Part 1.

26 G. Paul Phillips, memorandum to Secretary of DEA, 4 March 1957, NAA: A1838, 766/1/3 Part 1; McEwen to Casey, undated, NAA: A1310, 810/1/6.

27 Cabinet Decision no. 716, 11 April 1957, NAA: 1838, 766/1/3 Part 1.

28 Memorandum for J.P. Quinn and Secretary of DEA, 4 July 1957, NAA: A1838, 766/1 Part 1.

29 R.G. Casey, cabinet submission no. 680 (withdrawn), 10 June 1957, NAA: A4926, 680; Mitcham, China’s Economic Relations with the West and Japan, 23.

30 Menzies to Arthur Fadden and Richard Casey, 1 June 1957; Richard Casey, Cabinet Submission no. 680 (withdrawn), 10 June 1957, both NAA: A4926, 680.

31 Washington to CBR, no. 696, 19 June 1957, NAA: A1838, 766/3/4 Part 3. Washington to Canberra, no. 733, 27 June 1957; Washington to Canberra, no. 375, 21 March 1958, all NAA: A1838, 766/3/33 Part 1.

32 L.J. Arnott, minute for Foreign Affairs Committee meeting, 15 July 1957, NAA: A1838, 766/1 Part 2.

33 J.P. Quinn, record of conversation with A. Peterson, 24 May 1957, NAA: A1838, 766/1 Part 1.

34 Editorial, Canberra Times, 1 June 1957; Editorial, The Age, 3 June 1957, both in NAA: A1310, 810/1/6.

35 L.J. Arnott, minute for Foreign Affairs Committee meeting, 15 July 1957, NAA: A1838, 766/1 Part 2.

36 M.A. Bassett, minute paper for G. Warwick Smith, 25 July 1957, NAA: A1313, 1964/7876 Part 1; Richard Casey, supplementary notes on cabinet submission no. 680, 20 August 1957, NAA: A4926, 680.

37 John Crawford to Arthur Tange, 20 September 1957, NAA: A1838, 766/1 Part 1.

38 D.O. Hay, record of conversation with Mr. McClintock, 20 May 1957, NAA: A1838, 766/1 Part 1.

39 Hong Kong to Canberra, no. 51, 28 March 1958; Hong Kong to Canberra, no. 53, 2 April 1958, both NAA: A1310, 850/16/1 Part 1.

40 M.A. Bassett, minute to G. Warwick Smith, 22 April 1958, NAA: A1310, 850/16/1 Part 1.

41 W.D. Forsyth, memorandum to the Secretary of DoT, 5 May 1958, NAA: A1310, 850/16/1 Part 1.

42 M.A. Bassett, memorandum to Assistant Secretary of DEA, 6 May 1958, NAA: A1838, 766/1/3 Part 1.

43 Smith, letter to J.V. Moroney, 26 June 1958, NAA: A1310, 850/16/1 Part 1.

44 Mitcham, China’s Economic Relations with the West and Japan, 33–35.

45 W.D. Forsyth, memorandum to the Minister for External Affairs, 28 April 1958, NAA: A1838, 766/33/3 Part 1; Richard Casey, Cabinet Submission no. 1129, 13 May 1958, NAA: A4926, 1129.

46 Cabinet Decision no. 1369, 13 May 1958, NAA: A4926, 1129.

47 Albinski, Australian Policies and Attitudes toward China, 102; King, China–Japan Relations after World War Two, 103, 106.

48 Washington to Canberra, no. 1090, 18 October 1956; Washington to Canberra, no. 118. 6 February 1957; Canberra to Washington, no. 686, 16 May 1958; Comptroller-General, Collector of Customs, Sydney, to director of Heine Brothers Pty. Ltd., 29 May 1958, all NAA: A425, 1963/35944.

49 Albinski, Australian Policies and Attitudes toward China, 250–258; Frank Bingham, ‘Australia’s Trade Since Federation’, Office of Economic Analysis Investment & Economic Division, Department of Foreign Affairs and Trade, 14, https://www.dfat.gov.au/sites/default/files/australias-trade-since-federation.pdf; Wilson Au-Yeung, Alison Keys and Paul Fischer, ‘Australia-China: Not Just 40 Years’, Economic Roundup 4 (2012), Australian Government Department of Treasury, https://treasury.gov.au/publication/economic-roundup-issue-4-2012/australia-china-not-just-40-years.

50 M.A. Bassett, memorandum for trade relations officer, 11 August 1958; D.J. Munro, Draft memorandum to Secretary of DoT, undated; M.R. Booker, memorandum no. 31/59, to Secretary of DEA, 21 January 1959, all NAA: A1838, 766/33/3 Part 1.

51 Qu and Xu, ‘China’s Grain Imports from Canada and Australia from the Autumn of 1960 to May 1961’, 111–12.

52 Xiong and Tan, ‘On the Work of China’s Food Imports in the 1960s’, 141.

53 Albinski, Australian Policies and Attitudes toward China, 283–84, 286–87; Commonwealth Bureau of Census and Statistics, Overseas Trade, 1963–64, Bulletin no. 6 (Canberra, 1964), 659, https://www.abs.gov.au/AUSSTATS/[email protected]/DetailsPage/5409.01963-64?OpenDocument.

54 Albinski, Australian Policies and Attitudes toward China, 273.

55 P.R. Heydon, note to Mr. Harry, 16 January 1961, NAA: A1838, 766/1 Part 3.

56 Cabinet decision no. 245, 24 May 1962, NAA: A4940, C3588.

57 Canberra to Hong Kong, no. 108, 19 April 1961, NAA: A1838, 766/1 Part 3.

58 Xiong and Tan, ‘On the Work of China’s Food Imports in the 1960s’, 140.

59 Xiong, ‘How Zhou Enlai Led the Efforts in Overcoming Food Difficulties in the Early 1960s’, 88.

60 Albinski, Australian Policies and Attitudes toward China, 288–91; Mitcham, China’s Economic Relations with the West and Japan, 60; Qu and Xu, ‘China’s Grain Imports from Canada and Australia’, 114.

61 John McEwen, draft letter to Robert Menzies, undated; cabinet decision no. 1245, 2 March 1961, NAA: A4940, C3287.

62 A.J. Campbell, memorandum to Ottawa, 3 March 1961; Ottawa Canberra, no. 82, 8 March 1961, NAA: A2051, S325 Part 2; Qu and Shang, ‘China’s grain imports from Canada and Australia’, 114.

63 Qu and Shang, ‘China’s Grain Imports from Canada and Australia’, 114–15.

64 Ottawa to Canberra, no. 82, 8 March 1961; Ottawa to Canberra, no. 143, 28 April 1961, both NAA: A2051, S325 Part 2; Albinski, Australian Policies and Attitudes toward China, 289; Washington to Canberra, no. 1347, 23 May 1961, NAA: A4940, C3287.

65 McEwen, draft letter to Menzies, undated, NAA: A4940, C3287.

66 Mitcham, China’s Economic Relations with the West and Japan, 58, 64.

67 J.L. Lavett, memorandum for Secretary of DEA, no. 710, Tokyo to Canberra, 3 September 1962, NAA: A1838, 766/3/4 Part 3.

68 Washington to Canberra, no. 105, 16 January 1962, NAA: A4642, S148.

69 Canberra to Washington, 23 February 1962, no. 317; Canberra to Washington, 23 February 1962, no. 320, both NAA: A4642, S148.

70 Extract from report of 1962 ANZUS meeting, NAA: A1838, 766/1/4 Part 3.

71 Ottawa to Canberra, no. 416, 21 December 1962; Canberra to Ottawa, 24 December 1962, both NAA: 766/1/4 Part 3; Ottawa to Canberra, no. 381, 20 November 1962, NAA: A2051, S325 Part 5. Interestingly, New Delhi did not appear to have protested to Canada or Australia over the credit line – eg, Canberra to Ottawa, 24 December 1962, NAA: 766/1/4 Part 3.

72 R.A. Peachey, memorandum to the Secretary of DEA, 25 January 1963; Washington to Canberra, no. 136, 15 January 1963, both in NAA: A1838, 766/1 Part 3.

73 Garfield Barwick, letter to John McEwen, 18 January 1963; McEwen, letter to Barwick, 19 February 1963; Barwick to McEwen, undated, both NAA: A1838, 766/1/4 Part 3.

74 ‘Australia and China: trade relations as of November 1962’, undated background paper, DEA, NAA: A1838, 766/1 Part 3.

75 DEA, ‘Notes on Western Wheat Trade with Communist China’, 1 December 1962, NAA: A1838, 766/1/4 Part 3.

76 R.L. Harry, draft letter for the Minister in reply to Malcolm Fraser, 27 February 1963; R.L. Harry, memorandum to the Secretary of DEA, 25 February 1963, both NAA: A1838, 766/1/4 Part 3.

77 R.A. Peachey, memorandum to R.L. Harry, 27 March; R.L. Harry, memorandum to Secretary of Primary Industry, 4 April 1963; J.R. Rolland, memorandum to the Minister for External Affairs, 22 April 1963, all NAA: A1838, 766/1/4 Part 3.

78 R.A. Peachey, record of conversation with Mr. McPherson, 8 May 1963, NAA: A1838, 766/1/4 Part 3.

79 J.R. Rowland, memorandum to the Minister for External Affairs, 10 May 1963, NAA: A1838, 766/1/4 Part 3; Albinski, Australian Policies and Attitudes toward China, 291.

80 G.R.B. Patterson to Sectary of DoT, 5 September 1961, NAA: A1838, 766/1 Part 3.

81 Albinski, Australian Policies and Attitudes toward China, 293.

82 Xiong and Tan, ‘On the Work of China’s Food Imports in the 1960s’, 141.

83 ‘Australia Trade with China and United States Attitude To It’, undated DEA paper, NAA: A1838, 766/1 Part 4; Albinski, Australian Attitudes and Policies toward China, 298–301.

84 Australian Government, Commonwealth of Australia Budget 1962–63, c. August 1962, 8, 40, https://archive.budget.gov.au/1962-63/index.htm.

85 Wilfred Coutts, CPD, HR, 30 March 1965, Historic Hansard, https://historichansard.net/hofreps/1965/19650330_reps_25_hor45/#subdebate-29-0; Charles Adermann, CPD, HR, 8 April 1965, Historic Hansard, https://historichansard.net/hofreps/1965/19650408_reps_25_hor45/#subdebate-1-0.

86 Albinski, Australian Attitudes and Policies toward China, 225, 316; Garry Woodard, ‘Australia’s China Policy of Strategic Ambiguity: Navigating Between Big Fish’, Australian Journal of International Affairs 72, no. 2 (2018): 165.

87 Albinski, Australian Attitudes and Policies toward China, 218–19, 312–18.

88 Li, ‘The great significance of Sino–Canadian in the 1960s to China’, 91.

89 Patrick Galvin, CPD, HR, 29 September 1966, Historic Hansard, https://historichansard.net/hofreps/1966/19660929_reps_25_hor53/#debate-41. See also, Kim Beazley (Sr.), CPD, HR, 19 March 1964, Historic Hansard, https://historichansard.net/hofreps/1964/19640319_reps_25_hor41/#subdebate-30-0.

90 Bill Hayden, CPD, HR, 19 April 1966, Historic Hansard, https://historichansard.net/hofreps/1966/19660419_reps_25_hor51/#subdebate-17-0-s6; Arthur Calwell, CPD, HR, 4 May 1965, Historic Hansard, https://historichansard.net/hofreps/1965/19650504_reps_25_hor46/#subdebate-33-0-s0.

91 Albinski, Australian Attitudes and Policies toward China, 319–20.

92 Australian Gallup Poll, nos. 1253–1263, June–July 1957, and nos. 1347–1359, October–November 1958, nos. 1653–1664, January–February 1963, cited in Albinski, Australian Attitudes and Policies toward China, 256, 265, 285.

93 G.N. Upton, draft letter for Acting Secretary to P.D. Samuel, 9 July 1964; F. O’Connor, memorandum to A.T. Carmody, 18 August 1964; DEA, savingram to all posts, AP. 85, 7 August 1964, all NAA: A2051, S325 Part 6.

94 Wilfred Coutts, CPD, HR, 30 March 1965, Historic Hansard, https://historichansard.net/hofreps/1965/19650330_reps_25_hor45/#subdebate-29-0; Patrick Galvin, CPD, HR, 29 September 1966, Historic Hansard, https://historichansard.net/hofreps/1966/19660929_reps_25_hor53/#debate-41-s2.

95 Arthur Calwell, CPD, HR, 4 May 1965, Historic Hansard, https://historichansard.net/hofreps/1965/19650504_reps_25_hor46/#subdebate-33-0-s0.

96 Bill Hayden, CPD, HR, 19 April 1966, Historic Hansard, https://historichansard.net/hofreps/1966/19660419_reps_25_hor51/#subdebate-17-0-s6.

97 Charles Adermann, Cabinet Submission no. 72, 10 March 1966; Cabinet Decision no. 82, 15 March 1966, both in NAA: A5619, C410.

98 Cabinet Decision, no. 184, 19 April 1966; Cabinet Decision, no. 253, 17 May 1966, both NAA: A5619, C410.

99 For an exception, see Harold Holt, CPD, HR, 20 October 1966, Historic Hansard, https://historichansard.net/hofreps/1966/19661020_reps_25_hor53/#subdebate-6-0-s1.

100 Eric Andrews, Australia and China: The Ambiguous Relationship (Carlton, Vic: Melbourne University Press, 1985), 198; David Goldsworthy, D. Dutton, P. Gifford and Roderic Pitty, ‘Reorientation’, in Facing North, volume 1, ed. David Goldsworthy (Melbourne: Melbourne University Press, 2001), 330.

101 Stephen FitzGerald, Talking with China: the Australian Labor Party Visit and Peking’s Foreign Policy (Canberra: Australian National University Press, 1972), 11; Billy Griffiths, The China Breakthrough: Whitlam in the Middle Kingdom (Melbourne: Monash University Press, 2012), 23–30.

102 For example, Gough Whitlam, Speech and responses to press conference, National Press Club, Canberra, 26 July 1971, The Whitlam Institute, https://rosetta.westernsydney.edu.au/delivery/DeliveryManagerServlet?dps_pid=IE2749; Whitlam, ‘The United States, China and Japan – Australia’s Role’, Speech, Townsville, 25 September 1971, The Whitlam Institute, https://rosetta.westernsydney.edu.au/delivery/DeliveryManagerServlet?dps_pid=IE2827; Whitlam, ‘Establishment of diplomatic relations with China’, Press release, 22 December 1972, Prime Minister and Cabinet, https://pmtranscripts.pmc.gov.au/release/transcript-3121.

103 Bucknall, ‘Australia–China Trade’, 52, 71.