The 2018 Annual Forecast said that Australia would serve as a key swing state in the U.S.-China rivalry given its security and economic relationships with both sides. Australia's continued political turmoil will complicate its efforts to play a more active role in the burgeoning U.S. strategy in the region.
After a week of ruling party infighting, Australia has a new prime minister. Scott Morrison, a veteran government official who most recently served as national treasurer, won the post Aug. 24 after members of the Liberal Party voted to oust Malcolm Turnbull from office over his attempt to set an emissions-reduction target for Australia. The issue ignited tensions between Turnbull and the conservative wing of the Liberal Party, as the party hopes to improve its performance in polls ahead of next year's elections. In a closed-door contest three days after Turnbull narrowly survived the first challenge to his leadership, Morrison defeated Peter Dutton, Turnbull's most vocal challenger, by a vote of 45-40.
Why It Matters
The latest succession is Australia's sixth change of leadership in the past decade. But despite concerns that the country's prolonged political disarray is distracting it from the geopolitical change in the Asia-Pacific region, the government will stay focused on domestic problems for the time being. Morrison, a compromise choice, now faces the difficult task of uniting his party and its coalition partners around him. Before his removal from office, Turnbull threatened to resign from Parliament, and if he follows through, the Liberal Party may lose its one-seat parliamentary majority in the resulting by-election. Furthermore, with nationwide elections just around the corner, Morrison and his government will emphasize such popular issues as lowering energy prices and dealing with Australia's devastating drought to try to appeal to voters. The new prime minister will inherit the economic problems his predecessor faced as well, including inflation, stagnant wages and rising property prices.
Outside Australia, the latest political shake-up will raise questions for the wider region at a time of increasing competition. Morrison's reputation for taking a hard line on immigration and asylum seekers, for example, could stoke tensions with neighboring Indonesia, a way station for asylum flows in the Asia-Pacific. His leadership also could largely mirror that of his predecessor, which strained relations with China. Throughout his political career, Morrison has both championed greater economic engagement with the country and called for restricting Chinese investment on national security and protectionist grounds. In addition, he played a prominent role in enacting laws to limit China's access to sensitive domestic sectors.
What Happens Next
Much is still unclear about the next steps for Australia's government, but the new prime minister is unlikely to move the country in a different direction. The ruling party's parliamentary majority is tenuous, leaving it in no position to undertake any shifts to Australia's recent policy of aligning with U.S. regional defense strategy to try to counterbalance China. For now, the government will probably focus on domestic issues, while the opposition works to exploit the divisions in the ruling coalition.