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Faraway so Close!: The Effect of Asian Values on Australia’s Interactions with East Asia

Asian values discourse has focused on the Confucian cultural peculiarities of East Asia as the motorforce behind the East Asian “miracle”, which is characterised as significant economic boom, increased welfare, and more fair distribution of income in East/Southeast Asia. These peculiarities have both pragmatic and psychological/intellectual dimensions, which, seemingly, operate independently but actually complement each other. Psychologically, Asian values claim an East Asian intellectual and cultural exclusiveness from the “West” but, pragmatically, they actually encourage commercial relations with non-Asians. Australia’s contemporary relations with East Asia are a clear example of this. A trade-oriented and pragmatic engagement with the region has relegated politico-strategic relations to the background. This research argues that to move beyond trade and increase the influence of a non-Asian power, such as Australia in East Asia, the psychological dimension cannot be ignored.

Faraway so Close The Effect of Asian Values on Australia
Australia’s Prime Minister Tony Abbott shakes hands with China’s President Xi Jinping as he arrives for the Asia-Pacific Economic Cooperation (APEC) Summit, on November 11, 2014. AFP PHOTO / GREG BAKER


Beginning in the 1990s, several discourses emerged to interpret the existence and virtues of Asian values, two of which constitute the starting point of this research. The first one focuses on East Asia’s major cultural commonalities. The second one explains how these commonalities have contributed to East Asian economic development. This research merges the two in order to accentuate two dimensions of Asian values: the psychological “P” (cultural and intellectual) and the pragmatic “P” (economic and commercial). For the Asian Values literature the two “Ps” mark almost a new dichotomy, particularly in terms of interpreting a non-Asian actor’s interactions with the region. Asian values are mostly analysed as Confucian projections of Asian, specifically East and South-eastern, commonalities. Yet the research on the two “P”s skews this angle, by merging various discourses on Asian values, and aims to cast a light on how Asian values operate inter/intra East Asian interactions. 

The 2 “P”s operate in East Asia both independently and complementarily. The psychological dimension has an intellectual and cultural value, which claims the exclusiveness of East Asia and its distinctiveness from the “West.” The pragmatic dimension has an economic and commercial value, which almost discards East Asia’s supposed distinctiveness, and initiates and sustains East Asia’s commercial relations with non-Asians. The values represented by the two “P”s complement each other in terms of supporting East Asia’s economic development and maintaining the level of development within the East Asian framework. This research aims to provide clues so that non-Asian powers can approach the region with more Asia-compatible policies and deepen and broaden the spectrum of their relations across the region.

Asian values generate flexibility in the region in terms of economic and commercial interdependencies, and keep the communication and business channels open for non-Asian actors

One of the non-Asian powers that stands to benefit from this analysis, which enjoys a significant geographical but relatively less cultural proximity to East Asia, is Australia. The Australian case study illustrates how, for non-Asian actors, the psychological and pragmatic elements of East Asian culture are necessarily two sides of the same coin. It also reveals the type of interactions of a non-East Asian country that are hindered by the influence of Asian values, when not understood. 

The seemingly symbiotic nature of the 2 “P”s highlights the fact that Asian values do not create an exclusionist tendency, or an “authentically Asian” way of doing business; rather they generate flexibility in the region in terms of economic and commercial interdependencies, and keep the communication and business channels open for non-Asian actors. Yet, for diplomatic and political relations, Asian values have a restrictive effect on non-Asians. Australia’s reluctance to brandish its “Asianess” (and as a consequence engage seriously with Asian values) has restrained Canberra’s strategic thinking about the changes in Asia and their resulting challenges, particularly when relations among the Asian Giants are problematic or tense. This limits Australia’s political and strategic weight in the region. 

To alleviate the limitations caused by the influence of 2 “P”s, simply understanding Asian values may not be sufficient for non-Asian actors, as can be seen in the Australian example. They need to both understand and integrate these values into their diplomatic practice, and demonstrate a more culturally/psychologically Asia-oriented approach through their strategic and political relations with the region. Such an effort will enable Australia and other non-Asian actors to be welcomed as more equal partners by East Asia, and will also increase their space to manoeuvre during a crisis among Asian giants. 



Asian Values in Practice: The 2 “P”s 

A great deal of post-Cold War IR literature has focused on the role of the peculiarities of Asia’s rise, namely the “East Asian miracle.”1The developments2 unearthed cultural, commercial and even psychological elements peculiar to East Asia, which are known collectively as “Asian values.” These values are not crystal clear and cannot easily be categorized. As Koro Bessho3 underlined, there is ‘no single set of clearly defined values applicable to Asia as a whole, or even to East Asia.’ This makes Asian values more of a flexible and comprehensive set of cultural and psychological commonalities than a rigid regional identity package. 

Although the discourse on Asian values has changed focus over time, its psycho-cultural motto has stayed the same: East Asia is proudly and exclusively different from the “West.” The term “Asian values,” in today’s understanding, was first used in the 1970s in order to make cultural reference to the East Asian Miracle by focusing on merely Asian qualities.4 The discourse was rejuvenated with the Universalist claims of human rights and democracy made by the United States in the 1990s. East Asian countries saw this claim not as an exemplary humanitarian value, but as the creeping reach of the U.S.’ ideological domination.5 Thus both in the 1970s and the 1990s, Asian values discourse emanating from Asia itself had an anti-Western feeling and an assumption of Asian supremacy. 

There are four major strands of the discourse on Asian values.6 The first strand asserts that Asia has a distinct value system based on collective destiny, individual sacrifice, and communitarianism. The values and institutions of Western democracy do not completely fit into this system. The assertion of a distinctly Asian values system has been criticized on the basis that proposing such a value set is a deliberate ploy to justify and protect East Asian semi-democratic regimes.7 Supporting this criticism, Malaysia’s former Deputy Prime Minister stated that ‘it is altogether shameful to cite Asian values as an excuse for autocratic practices’.8 

The second strand of Asian values discourse focuses on the philosophical and historical roots of Asian values in Confucian and other Asian traditional texts. The proponents of this strand9 claim that although Asian values are not compatible with the notions of Western democracy, they are still democratic by their very nature. Criticisms of this approach argue that ‘proving’ the democratic underpinnings of Asian values by referring to ancient Asian texts (particularly Confucian, Buddhist, Indian epics, Mongolian, and Persian dating from about the 8th century), is disingenuous: nearly anything can be ‘proven about pro-democratic ideas’ using this method.10

With the 1990s, the psychological aspect of Asian values revitalized Confucian traditional values

The third strand, which attracts relatively less criticism, aims to find empirical links between Asia’s political and economic development and its values, from a trans-regional and transnational perspective.11 The fourth strand downplays the cultural authenticity of these values12 by arguing that they ‘are not especially Asian by any significant sense,’ and can be found in other civilizations.13 According to this analysis, economic reforms in East Asian countries are more about ‘socio-cultural engineering’ than Confucian cultural heritage.14

It is not easy to capture the essence of Asian values in a single document since they are “living, breathing cultural forces, too subtle, too slippery, above all too alive.”15 They are not static but rather remodelled, reimagined, and reappropriated at different times. Nevertheless, merging the first and third approaches above reveals two dominant areas of the influence of Asian values: psychological (cultural/intellectual) and pragmatic (economic/commercial). These 2 “P”s operate both independently and complementarily at the same time. 

The crux of the psychological “P” goes back to the German thinkers’ unique German Kultur arguments developed against the democratization trend in Britain, France and the United States.16 Originating from these arguments, this “P” emphasizes East Asia’s distinct cultural value system almost as a reaction to Western democratic, individualistic and liberal values.17 In this sense, reference to Asian values is an intellectual effort to uplift and emphasize East Asia’s cultural peculiarities.

The psychological “P” was a recurring feature of the Singaporean and Malaysian statesmen’s statements of the 1970s, perhaps a result of the increasing influence of South East Asia, which coincided with weakening Chinese and Indian political leadership in the region in the 1960s.18 The English colonial legacy in these countries also meant that the politicians could deftly manoeuvre and project their views in the English-dominated international media. Asian unity was also appealing to the political elites of these former colonies, as a means of cementing the multiethnic nation within the state.19 The statements stressed that Asian values were not only unique but also “better” than their Western equivalents. Former Singaporean leader Lee Kuan Yew, defined Western values as “infectious” in his speech on National Day in 1978 and the ‘antidote’ he proposed should be the “strong assertion of the Asian values common to all Singapore’s ethnic groups,” and that “the virtues of individual subordination to the community … counteract[ed] the disruptive individualism of western liberalism.”20

With the end of the Cold War, the psychological narrative of Asian values transformed once again as an expression of confidence, pride and the empowerment of being “Asian” and being different from, or even opposing, the West. Lee Kuan Yew and former Malaysian Prime Minister Mahathir bin Mohamad often argued that these values had invigorated Asia and had paved the way for the East Asian miracle.21 Mohamad stated: 

“There was much talk of the 21st Century becoming the Asian Century. The Europeans were not going to have things their way much longer. … The threat of Asian domination of the world in the 21st Century was becoming more and more real. They could not be stopped militarily. Nor could the West defeat them and impoverish them by competing in the Market.”22

Asian leaders’ statements found audience in the West. Some Western economists supported Lee and Mahathir, agreeing that the economic development in Japan, Korea, Hong Kong and Taiwan was due to their distinct socio-cultural characteristics that challenged Euro-American culture. 23 

With the 1990s, the psychological aspect of Asian values revitalized Confucian traditional values. This revitalization stressed that the core cultural differences between the East and the West maintained the supremacy of the East over the West, and also acted like a politico-cultural linchpin to hold East Asian countries together despite their economic, political, ethnic, and societal diversities.24 In this sense the psychological “P” signified the Asianisation and de-westernization of Asia, at least in terms of ‘social, moral and political matters’. 25Therefore, the psychological aspect of Asian values had the potential to politically and culturally exclude a non-Asian actor, in our case Australia, from the region. Reversely, the more a non-Asian actor appealed to the psychological “P” the more it could increase its political and cultural substance in the region.

The pragmatic “P” is linked to East Asia’s economic and commercial relations and does not operate via exclusionist tendencies. On the contrary, it emphasizes flexibility in trans-regional economic and trade schemes, which encourage “regional allegiances across a broad swath of East and Southeast Asia’ via ‘a network of transnational capital flows.”26 In other words the psychological and the pragmatic “P”s operate as independent spheres - or seem to. 

Focusing on the pragmatic “P” gives a special insight into East Asia’s recovery from the 1997 Asian Crisis. The Crisis discredited Asian values in general. Commentators have stated that the 1997 crisis seemingly sounded ‘the death knell’ of the Asian values discourse.27 Francis Fukuyama, similarly, claimed that the crisis punctured “the idea of Asian exceptionalism.”28 The pragmatic “P,” at this point, emphasized the significance of interdependence for East Asian societies, which relied on the collectivist-individualist dualism of cross-cultural psychology.29 Culturally, this line of thought argued that Asians have interdependent personalities, in contrast to the Westerners’ independent personalities,30 and that this difference contributed to the openness of trans-regional interaction channels of economic development by encouraging Asian and non-Asian actors to cooperate and deliver goods, services and information. In the pragmatic sense, such an interdependent scheme increased the number of ties between Asian and non-Asian actors and strengthened the quality of commercial relationships. 

East Asian multilateral schemes give a good depiction of how the psychological-pragmatic dichotomy is an illusion; the two elements, though independent from each other, are complementary. Asian multilateralism, as seen in the Association of Southeast Asian Nations (ASEAN) way, depends on Confucian harmony, which operates through a ‘flexible engagement’ and the pursuit of ‘enhanced interaction’ to promote regional peace and stability by establishing politico-security dialogue and cooperation.31 In order to maintain Confucian harmony, Asian multilateral schemes keep their focus narrow, i.e. the International Organization of Securities Commissions, the International Associations of Insurance Supervisors, and International Accounting Standards Board. They also usually limit the number of members, i.e. the ASEAN Free Trade Area and the 2002 ASEAN-China Free Trade Area framework agreement.

The psychological “P” forms the basis of ‘regional multi-polarity,’32 which considers Asia as a big family where a ‘long’ and ‘coherent cultural tradition’ unifies ‘cultural cleavages and social schisms.’33 This “family dynamic” engenders the multitude of multilateral schemes with overlapping memberships operating in the region. The pragmatic “P”s complements this by influencing East Asian actors’ nationalist tendencies.34 Although East Asian nationalism resists ‘assimilation through foreign cultures’ and emphasizes ‘independence and autonomy,’ the pragmatic “P” makes regional actors interpret intra/extra regional multilateral schemes as a “vehicle of modernisation.”35 Such pragmatic influence understates East Asian actors’ conflicting national interests in their relations within or outside the region. In this way, they can operate more in harmony and alignment, less in conflict and antagonism.

The task of Asian Values is an attempt by Asians to ‘work out social, political, and philosophical norms that best capture their peoples’ aspirations

The review of 2 “P”s so far shows that Asian values should not be denigrated as a political instrument of some Asian leaders to cover their “undemocratic” governing principles. Asian values discourse is more of a post-colonial politico-cultural project, to identify East Asia by using its “authentic” common values. As Mahbubani reformulated: the task of Asian Values is an attempt by Asians to ‘work out social, political, and philosophical norms that best capture their peoples’ aspirations.’36Asian values do have an anti-Western aspect, but overall, these values have ‘much more to do with an internal Asian debate about the nature of the good life, regional community, the dynamics of modernisation and its links, whether modernisation means Westernisation, the civic dimension of life, the reconciliation of indigenous traditions with new cosmopolitan dynamics, the challenges of globalisation.’37 The process of the discussion about Asian values was triggered by political self-confidence of the East Asian regimes boosted by their record-breaking economic growth. 

The 2 “P”s operate in East Asia’s regional affairs both independently and complementarily. The psychological aspect claims the exclusiveness and distinctiveness of East Asia by focusing on Confucian commonalities through an intellectual process. The pragmatic aspect discards this exclusiveness and open channels for non-Asians to align with East Asians in the commercial sphere. The two “P”s also complement each other, particularly in terms of the quality and the efficiency of these trans-regional multilateral alignments. The psychological “P” maintains that these alignments operate via East Asia’s distinctive and peculiar Confucian elements, and the pragmatic “P” complements this by keeping the commercial interdependence channels open for non-Asians via an inclusive, flexible and less nationalistic understanding. Therefore if a non-Asian actor attempts to have an all-inclusive and a well-functioning alignment with East Asia, it needs to satisfy the psychological in addition to the pragmatic aspect. In other words, that non-Asia actor should act in conformity with East Asian cultural peculiarities alongside any commercial requirements. Australia’s interaction with the region is particularly relevant in showcasing the impact of the 2 “P”s on a non-Asian actor’s relations with the region. 



Australia in Asia: The influence of 2 “P”s

Given that Asian values are a post-Cold War product, post-Cold War Australian governments have more relevance in this analysis. In the post-Cold War era, the Labor governed four times (1983-96; 2007-2013) and the Conservative (Liberal and National Party) Coalition held power once (1996-2007). Both Parties focused on developing relations with East Asia, but with differing approaches. The commercial and political consequences of these approaches give us hints about the influence of the 2 “P”s on a non-Asian actor’s relations with the region.

The pragmatic “P” enables flexibility and openness, particularly in trans-regional capital/goods/services/raw material flows. In such trans-regional relations, a lack of Asian values in non-Asian actors does not have a detrimental effect, so long as the relationship contributes to regional economic development. In this context, the pragmatic “P” boosts the number and the quality of ties between Asian and non-Asian actors. The psychological “P” however, with its exclusionist tendency, confines the same non-Asian actor’s connexion within the commercial sphere and restricts its cultural and politico-diplomatic weight in the region. The fact that the 2 “P”s complement each other in the formation and operation of Asian multilateral schemes makes it more important for non-Asian actors to appeal to the psychological “P.” If the non-Asian actor does not address the psychological “P” appropriately, its success in deepening its political weight is restrained. 

Australia’s relations with the region illustrate this restriction and incite an additional question. Since the end of the Cold War, Australia’s commercial relations with the region have been developing. Yet Australia’s Commonwealth origin and insufficient understanding of Asia’s psychological “P” have restrained its incorporation into East Asia and frustrated its overall ability to exert political, diplomatic and cultural weight in the region. The additional question is that, even if Australia managed to recalibrate its foreign policy in order to sufficiently appeal to the psychological “P,” would East Asians appreciate it and accept Australia as an equal partner? This remains still uncertain. 

The Australian Labor and Coalition governments differed in how they addressed the psychological “P.” Yet there was not much of a difference in their success (or lack thereof) in increasing Australia’s politico-diplomatic weight in East Asia. In one way, Coalition governments might be seen to have benefited from the progress made by the preceding Labor governments. One might argue that Coalition governments under John Howard were able to make breakthroughs in commercial and economic relations, even without emphasising the psychological aspect of those relations. Bob Hawke, Paul Keating, Kevin Rudd, and Julia Gillard’s Labor governments tried to address the psychological element, and learn from past mistakes, but their policies (which shared the same commercial/economic goal as the Coalition government, albeit via a different means) were also flawed. 

Australian foreign policy’s shift, with the end of the Cold War, from a focus on geo-politics to one of geo-economics made East Asia more alluring than ever

Keating and Hawke’s weakness was that they did not prepare public opinion for a more Asia-oriented Australia. In their efforts at re-orientation, as an additional weakness, they did not understand how to engage Asian values. They used very Anglo-western neo-liberal concepts and thought that these concepts could help them win over their Asian neighbours. Rudd and Gillard tried to understand more of the psychological “P” and where Asians were coming from. Rudd created a sense of excitement, as a result of which Asians seemed almost ready to accept the possibility of a ‘more Asian’ Australia. He focused, both personally and professionally, on the psychological side, believing that this could deepen Australia’s relations with the region. Gillard, as Rudd, assumed that she understood the psychological “P” and hoped that that this would give Australia more political clout in Asia. Yet Asians didn’t perceive it in the same way. 

The reason for Asian’s misperception on Gillard’s overtures was again the psychological “P.” The opportunities (or perceived opportunities) that Rudd could potentially bring about with his zest for Asian values were not backed up with sufficient policy depth in Canberra regarding the different facets of Asian values, and how to make them work for countries ‘on the outside looking in’ (or even those ‘on the inside looking in’). Nor did Rudd’s enthusiasm seem to be shared in the Canberra policy establishment, as if the benefits of showing an engagement with the psychological side were unclear, perhaps not worth the effort. All this explains why Rudd would eventually fall back on a similar policy approach to that of Keating and Hawke: a more Australian-centric approach; a well-known Australian ‘posture’ in the region and one which quickly dissipated any particular interest among Asian partners in Rudd’s new rhetoric of Australia’s Asian credentials. Gillard tried to build on Rudd’s (shaky) foundations more systematically with the “Australia in the Asian Century White Paper.” Yet this wasn’t engaging the psychological “P,” and again relied on an Australia-centric approach. 

Australian foreign policy needed to integrate the type of understanding and willingness to engage with the psychological “P” –a mixture of the Rudd ‘novelty’ with Gillard’s methodical approach. Canberra also needed to prepare public opinion for what might still be seen as an important cultural shift. And, finally, these efforts all needed to be presented in a non-Western and more Asian values-oriented way. Finally, it required a shift in Australian bureaucratic focus for, practitioners might ask, what was the point of a methodical appeal to Asian values if one could not be sure that it would result in any substantive changes in the approach/perception of Asian neighbours themselves. What if it was simply a lot of sound and effort, ultimately signifying nothing? 

Hawke and Keating’s weaknesses in their efforts to deepen relations with East Asia shows that they were not quite aware of the importance of addressing the psychological “P.”

Australian foreign policy’s shift, with the end of the Cold War, from a focus on geo-politics to one of geo-economics38 made East Asia more alluring than ever. Hawke and Keating aimed to “relocate” Australia in Asia via re-conceptualizing its image.39 In this re-conceptualization, they tried to whitewash Australia’s Western cultural heritage and act more “Asian.”40 Yet their inefficient understanding of psychological “P” weakened their efforts in such a way that they did not get the necessary appreciation from East Asians.

The weaknesses of Hawke’s attempts could be observed in two major products of his “Look North” policy, also known as a ‘remarkable metamorphosis’41 in Australia’s outlook on Asia. The 1987 Defence White Paper was its product on defence policy.42 The Paper outlined Asia’s significance for Australia by proposing that Australia’s strategic interests should be extended to ‘South-East Asia, Indochina, the eastern Indian Ocean and the South-West Pacific’, and emphasizing the ‘commonalities of strategic interests between Australia’ and the regional countries. Yet the Paper put Australia in a preeminent position regarding East Asian security cooperation by implying that Australia’s location, population size and distribution, and national economic resources and infrastructure make it unique and even superior to East Asian actors. Such an Australia-orientated approach contradicted the very emphasis of the psychological “P” and caused a major weakness.

Hawke’s economic advisor Ross Garnaut’s “Australia and the Northeast Asian Ascendancy” report in 1989 was the economic/commercial product, with a similar weakness. The report underlined that Australia could utilize East Asia’s economic opportunities only if it stopped ‘seeing Northeast Asian growth as a threat’ and develop foreign policy moves ‘backed by major efforts in education and research to make Australia aware of’ Asian languages, cultures and economics, together with “immigration policies … sympathetic to the needs of” Australia’s Asian neighbours.43 Garnaut’s report shows that Hawke and his staff did not grasp the complementarity of the 2 “P”s. Hawke assumed that addressing the pragmatic “P” would be enough to expand Australia’s influence in the region. 

Keating also dismissed this complementarity. Like Hawke, he mistakenly presumed that putting Asia at the heart of Australian life would strengthen Australia’s links with Asia.44 Again, he was more successful at harnessing the opportunities of the pragmatic “P,” since it did not require a major cultural recalibration and understanding. His efforts ended up increasing in Australian exports to Asia by two thirds of its total exports.45 Yet his heavy emphasis on Anglo-American elements in his foreign policy caused a similar weakness.

The weaknesses of Keating’s policies could be observed in economic and political segments of his foreign policy. On the economic side, during the formation of the APEC Forum, Keating hoped that such a multilateral structure could convince East Asians about the merits of Anglo-American neo-liberalist free trade and its success over Asian state-led, neo-mercantilist development strategies.46 Here, Keating’s attitude was heavily Western, which did not fit into the psychological “P.” On the political side, his foreign minister Gareth Evans’ rhetoric of ‘Comprehensive Engagement’ with Asia, theoretically aimed to replace the ‘tyranny of distance’ with the ‘advantages of proximity.’47 In his theory, Evans presented globalization, again a non-Asian concept, as a motivation to create shared interests, institutions and processes between Australia and Asian actors. In this argument Evans claimed that Australia was an independent and multicultural nation and could engage Asia with its own terms as a full and equal partner not as a part of American alliance or British Commonwealth.48 In his presentation Evans tried to show that Australia is more than a Western ally but he did not mention in what ways it is also a part of Asia and how it should address its peculiarities. In other words, Evans’ argument repeated the same mistake as his predecessors by not referring to the centrality of Asian values’. 

Another weakness was Keating’s miscalculation of public opinion’s significance. 49 Neither East Asians nor Keating’s voters were overly sympathetic to his attempts to change Australia’s cultural posture. Even though Evans and Keating never claimed that Australia was an Asian nation, their efforts were seen as an attempt to ‘Asianise’ Australian life. These cultural “awakening” attempts ignited a domestic debate in Australia about what they really meant.50 Some East Asians also ‘more or less ridiculed the idea that Australia was actually part of Asia’.51 Such lack of preparedness in domestic and Asian public opinion weakened Keating’s attempt to relocate Australia in Asia. 

The lack of a psychological “P” in Hawke and Keating’s efforts reflected on Asian statesmen’s remarks. Malaysian Prime Minister Mahathir stated that Australia’s new policy of relocating itself in Asia did not make Australia an Asian country. The Malaysian Minister of Foreign Affairs also stated that Australia was not a part of Asia.52 

The opening ceremony for the 47th Meeting of the Association of Southeast Asian Nations (ASEAN) Economic Ministers in Kuala Lumpur on  August 22, 2015. AFP PHOTO /  MANAN VATSYAYANAThe opening ceremony for the 47th Meeting of the Association of Southeast Asian Nations (ASEAN) Economic Ministers in Kuala Lumpur on August 22, 2015. | AFP PHOTO / MANAN VATSYAYANA

Hawke and Keating’s weaknesses in their efforts to deepen relations with East Asia shows that they were not quite aware of the importance of addressing the psychological “P.” Higgott and Nossal used liminality to explain Australia’s attitude to Asia in this era. Anthropologists use this term to explain in-between situations, as being in between adolescence and adulthood.53 For Australia, it means ‘being neither here nor there’. 54 During this era, Australia was still in between the old world of the British Empire and American global power of the twentieth century and the new world of the Asian Pacific. In short, Australia in the early post-Cold War period was drawn into East Asia via the shifting patterns of economic and commercial interdependence, rather than engaging with the region through a comprehensive foreign policy with a clear understanding of Asian values.

John Howard’s leadership, with the 1996 election, pushed Australian foreign policy even further away from the psychological “P.” Howard shifted attention from Labor’s enthusiasm vis-a-vis Asia to more conventional relationships, i.e. the U.S. Alliance. For Howard, Asia was still important but Australia’s national interests were more crucial than developing regional arrangements with Asians. Howard’s clearest disengagement from the psychological “P” was his reiteration of Australia’s western origin and its cultural distinctiveness from Asia. 55 

Howard’s distancing from the psychological “P” showed how Asian values could influence a non-Asian actor’s interactions with East Asia. Howard shifted Australia’s focus from East Asian multilateralism to relations with four key partners: the U.S., Japan, China, and Indonesia (COA 1997). The side effects of such distance were immediately clear. Australia was excluded from the ASEAN-Europe Meeting in 1996 and its involvement in other Asian schemes was vetoed by Malaysia.56 Moreover Australia was not accepted in the Asian side of the biennial Asia-Europe Meeting (ASEM), to the negotiations of a free trade agreement with the ASEAN Free Trade Area (AFTA), or the ASEAN Plus Three (APT) process.57 Australia’s ‘economic and security assets’ only ensured its membership to more functional and limited regional groupings such as the ASEAN Regional Forum and APEC forum.58 Excluding Australia from these regional schemes further weakened Australia’s visibility and understanding of the importance of the psychological “P,” and ultimately weakened its politico-diplomatic standing in Asia. East Asians, unconcerned, did not take any considerable step to change the status quo either. 

Since the 2 “P”s operate independently, as well as complementarily, breaking off from the psychological “P” did not curtail the pragmatic “P”s positive influence, in which Howard invested. At the end of his term in 2006, 50 percent of Australia’s two-way trade in goods and services, in other words 53 percent of exports and 47 percent of imports, were carried out with East Asia.59 The table below shows the pragmatic “P”s influence.


Table 1: Australia’s Trade in Goods and Services with North and Southeast Asian Economies –During John Howard’s EraSource: The table generated from Australian Department of Foreign Affairs and Trade (DFAT) Annual Reports on Performance Reporting Outcomes (


Howard’s investment in the pragmatic “P” could be observed in his Foreign Minister Alexander Downer’s definition of Asian regionalism. Downer argued that ‘practical regionalism’ is more preferable for Australia than ‘emotional regionalism’ in its relations with Asia. Practical regionalism offers ‘practical ways of working together’ to governments ‘bound together by geography’ in order to ‘achieve their mutual objectives’.60 According to Downer, Australia should cooperate with East Asians on an economic basis. A cultural recalibration is not really necessary. East Asians need Australia’s resources, minerals and supplies of energy, which will always make Australia relevant to the strategic calculations of the East Asian elites.61 This fits into the pragmatic “P”s motto in the sense that any sort of relationship that contributes to East Asian development should be supported and enhanced. 

The last three decades of Australia’s outlook to Asia was basically a success story of trade (import and export), which was not driven completely by Australian government policies

Labor came back to power with Kevin Rudd in 2007. Rudd was ambitious to resume Australia’s focus on a re-engagement with Asia.62 Rudd criticized Howard’s incompetency in addressing Asian values and claimed that Australia should ‘maximise the opportunities’ of the changes in Asia’s public sector policy formulation and regional institutional framework and ‘make’ its ‘own active contribution’ to the region.63 

With much enthusiasm, Rudd began to engage with the psychological “P”. He argued that Australia needed to re-orient its cultural outlook on Asia by developing ‘an appropriate form of national modesty’ rather than marking its distinctiveness, which could enable Australia ‘to avoid being over the top or grossly humble’. He believed that ‘only by doing so can’ Australia ‘hope to undo the damage that has recently been done to’ its perceptions ‘in the region’.64 Rudd was aware of the fact that the psychological “P” restricted Australia’s politico-cultural aura in the region. 

Yet Rudd could not incorporate this awareness into his foreign policy implementation. He aimed to turn Australia into a “creative” middle power,65 which could/should be the pioneer of innovative multilateral schemes for Asia. Rudd proposed the Asia Pacific Community (APC) 66 idea as an innovative reconfiguration of Asia-Pacific institutional architecture. The APC was against the psychological “P” because of its pro-Western and Australia-oriented structure. For Rudd, it should carry the European Union’s spirit and Australia could be its forerunner. The APC proposal was also very ambitious and therefore against the Confucian harmony of Asian multilateral schemes depending on narrow scope and members. The APC envisaged covering the whole Asia-Pacific region, with a potential to engage in the full spectrum of dialogue, cooperation and action on politico-economic and security matters. 

Barry Desker, from the S. Rajaratnam School of International Studies, stated that the APC proposal was ‘dead in the water right from the very beginning.’67 It was too ambitious and was out of Australia’s diplomatic, economic, and political reach. It also ‘triggered an ASEAN backlash due to a lack of prior consultation and ASEAN sensitivity about any possible challenge to its centrality.’68 The failure of the APC was pretty much the end of Rudd’s grandiose plans towards Asia. The APC proposal showed that Rudd’s awareness of the psychological “P” was only theoretical. His foreign policy was too Australia-centric and, therefore, not compatible with Asian values. Regardless of the APC’s failure, the pragmatic “P” continued amplifying Australia’s commercial relations with the region. 


Table 2: Australia’s Trade in Goods and Services with North and Southeast Asian Economies –During Kevin Rudd’s Era

Source: The table generated from Australian Department of Foreign Affairs and Trade (DFAT) Annual Reports on Performance Reporting Outcomes (


Rudd was aware of the psychological “P” but did not know how to address it efficiently. His overemphasis on Australia’s potential to be a pioneer flopped; due to lack of proper preparation he, and the Canberra policy establishment, fell back on their usual way of proposing something like the APC without contextualizing it in terms of Asian values. Rudd brought an excitement but it was not underpinned by the psychological elements of Asian values. Therefore the APC could only be moderately palatable for Asia.

In June 2010 Julia Gillard replaced Rudd. Gillard also attempted to address the psychological “P.” Her major contribution in this respect was “Australia in the Asian Century White Paper,” released on October 2012.69 To address the psychological “P,” the White Paper proposed to broaden and deepen Australia’s understanding of Asian cultures and languages and to become more Asia literate. The paper also aimed to complement this with developing new business models and mindsets to connect Australia to Asian markets more efficiently. These should be supported with a more intensive and multifaceted diplomacy in the region by integrating business, unions, community groups and educational and cultural institutions into the process. Gillard, with the White Paper, aimed to refocus on near neighbours and called on Australia to “get its own house in order, including through a competitive and diversified economy, education, Asia skills, innovation, social cohesion, infrastructure, environmental management, security and diplomacy”.70 Gillard’s approach was less-Australia centric and more Asian values promoting than Rudd’s. It also clearly acknowledged the complementarity of the 2 “P”s by emphasizing the importance of supporting professional (commercial, economic) connections with social, cultural, and people-to-people ones. 

The White Paper’s Achilles heel was its over-optimistic assumption that Australia was in a good position to make the most of the opportunities of the Asian century. Moreover, it did not put forward a clear political and diplomatic path, and failed to answer the following questions: how could Australia compete with the intermingling and conflicting interests of Asia’s rising giants and how would they influence Australia’s aura in the region?; what would their preferences likely be?; what capabilities would they likely have?; would sudden and dramatic movements among these giants cause unpredictable and unwanted consequences, i.e. ‘plausible strategic shocks from the Chinese polity’s one-party brittleness, India’s potential failure to meet the needs of its 600 million youth or a feasibly unpleasant shift in Indonesian politics’?.71 

The White Paper’s theoretical understanding of the psychological “P” did not balance expectations/wishful thinking and realpolitik. It ‘says much about how to seize the economic opportunities of Asia, but it ventures less about the perilous flipside --how to manage what could become great strategic uncertainty and turbulence’.72 In short the White Paper did not explore the uncertainties about the changes in Asia’s political and strategic landscape and how Australia should fit in. 

Gillard’s term was not an exception to the positive influence of the pragmatic “P.” Canberra’s insufficient appealing to the psychological “P” did not worsen its economic and commercial interactions. Despite the above-mentioned inadequacies of Gillard’s White Paper, Australia’s trade volume with Asia kept growing. 


Table 3: Australia’s Trade in Goods and Services with North and Southeast Asian Economies –During Julia Gillard’s Era

The table generated from Australian Department of Foreign Affairs and Trade (DFAT) Annual Reports on Performance Reporting Outcomes (


The last three decades of Australia’s outlook to Asia was basically a success story of trade (import and export), which was not driven completely by Australian government policies. Even though the Labor and the Coalition governments followed contrasting policies with regard to the psychological “P,” the pragmatic “P” kept the trade volume increasing. The major reason for that has been Australia’s resources, minerals and supplies of energy flow to the region. This flow will keep Australia relevant for the strategic calculations of East Asian policy makers. 

Australia’s attempts to deepen its relation with East Asia have been facing another issue, again posed by Asian values. For the East Asians the psychological “P” bears a cultural understanding of the region, which also has a racial element. The combination of racial and cultural elements brings up a regional solidarity among East Asians. Australia is not naturally a part of this solidarity due to its ‘racial and cultural composition, its close relations with the U.S. and Europe, and its identification with the West in key international forums.’ Therefore, admitting Australia into an Asian cultural understanding could detriment the promotion of East Asian solidarity. This raised a fear that Australia’s ‘cultural difference will complicate the region’s internal cohesion and homogeneity as it tries to play a concerted international role; and also because it is identified too closely with the very international interests that the regional bloc wishes to mobilize collectively against.”73 For Australia, appealing to the psychological “P” therefore means of developing policies/actions to alleviate this fear and adapt to East Asia’s cultural commonalities. 

Australia’s engagement with Asia has been shaped by structural shifts in the international system and the global political economy as they echoed through domestic political debates

This adaptation should be an intellectual process exactly like the Asian values discourse, which Australia has not understood efficiently enough. As Stephen Fitzgerald claimed: 

The Australian commitment to Asia was not one of the mind. It was not informed by deep knowledge. It was not thought out or conceptualised within an understanding of the elemental forces at work within Asian societies. It was in this sense not an intellectual engagement; it was not intellectualised. It was therefore almost incapable of sensitivity to subtlety or sub-text or silence, or even to direct and open alternative Asian views of this region and its future.74

This lack of intellectual engagement with the region limited Australia’s influence in diplomatic and political spheres in Asia in the last three decades. Ambitious or unrealistic policies did not bring expected foreign policy outcomes. Over time, Canberra became more Asian literate, but this literacy has not sufficiently grasped Asian values. This situation has kept Canberra an outsider, however much it boosts its pragmatic “P” interactions. This is one major reason why Australia is not seen as an equal partner but rather as a staunch American ally. The lack of intellectual engagement makes Australia’s responses to the changes in Asia too-often delayed, uncoordinated and underfunded. 




This study aimed to show that the meaning of Asian values could not be degraded to some early post-Cold War Asian leaders’ political instruments to cover their “undemocratic” practices or to some common Confucian values of East Asian actors used to stress their divergence from the West. Asian values are more of an ongoing process with many layers and operate via the above-mentioned 2 “P”s to maintain East Asian regional development. They consist of cultural, intellectual, political, economic and commercial layers, which do not necessarily perform in a synchronous way. The psychological “P” maintains the exclusiveness of the region via intellectual and cultural discourses, and the pragmatic “P” utilizes economic and commercial networks to develop trans-regional interdependence for the continuity of regional development. To develop its politico-economic weight, a non-Asian power should appeal to these “2 P”s. Australia’s engagement in East Asia –both the history and the process– is a good depiction of how these 2 “P”s operate independently and complementarily. 

Australia’s engagement with Asia has been shaped by structural shifts in the international system and the global political economy as they echoed through domestic political debates. These political debates, either in Labor or Coalition, did not really focus on an intellectual engagement with the region in order to address the psychological “P” more efficiently. The pragmatic “P,” on the other hand, flourished in Australia’s commercial relationship with East Asia by facilitating Australia’s raw material/mineral flow into East Asia. In this way, the 2 “P”s created an imbalance in Australia’s relations with the region, marked by a well-functioning and developing economic/commercial, and an insubstantial politico-diplomatic realm. 

Therefore the challenge that Canberra will face in the “Asian century” will not be commercial but intellectual, political and cultural.75 Australia’s policies since 1980s show Canberra’s efforts to be included in the economic strategies, organizations, institutions or forums of Asia; despite difficulties arising from the fact that Canberra does not appeal to the psychological “P” and cannot therefore be an equal and natural partner. 

None of the Asian giants could be the sole hegemon of the world’s largest continent. Yet there is an ongoing dynamic competition in the region, which is prone to unpredictable developments. As Wesley stressed, Australian society is still is ‘unaware and unprepared for these great changes and the challenges they pose’. ‘The growing safety and wealth of Australians has made them complacent about the outside world, and intellectual engagement has not kept pace with physical, strategic or economic engagement’.76

Regarding the cold hard reality of trans-regional affairs, Australia’s proper and sufficient addressing the psychological looms a big effort without a solid guarantee of success. A political reorientation of sufficient magnitude would require a significant effort. To date, Australia and non-Asians alike have focused on the pragmatic “P” because they benefit from it; they only try to focus on the psychological with the expectation that they are going to get benefit from that too. Therefore, Australia’s one-sided efforts to develop its psychological “P” may not beef up its politico-diplomatic weight. 

Improving relations is a two way street. Australia’s efforts won’t change anything unless Asian countries have an appreciation of those efforts. Asian countries need to appreciate the efforts of non-Asian countries in both the pragmatic and psychological spheres. They also need to consider what these efforts can provide rather than just refusing because they are non-Asian. This whole psychological “P,” in this sense, is all about how you see the other and make an effort to bridge and understand. This makes the pragmatic and psychological “P” as two sides of the same coin. 




  1. The East Asian Miracle was a World Bank report of August 1993, which emphasized that government intervention in the region for promoting exports was the most compatible form of intervention with a wide diversity of economic circumstances. See The World Bank, The East Asian Miracle: Economic Growth and Public Policy, Oxford: Oxford University Press for the World Bank, 1993, 347, 366–368. See also: Scott B MacDonald, Jonathan Lemco, Asia’s Rise in the 21st Century(Santa Barbara, California: Praeger, 2011); Richard Stubbs, Rethinking Asia’s Economic Miracle: The Political Economy of War, Prosperity, and Crisis (New York: Palgrave Macmillan, 2005); Jacob Braude and Yigal Menashe, “The Asian Miracle: Was It a Capital-Intensive Structural Change?”, The Journal of International Trade & Economic Development, Vol. 20, No. 1, (February 2011), pp. 31-51, Syed Tariq Anwar, “Trends in International Business Thought and Literature: Reviewing East Asia’s Miracle, Its Economic Dynamism, and Future Issues,” International Executive, Vol. 39, No. 1, (Jan/Feb 1997), pp. 83-109; Jong-Wha Lee and Kiseok Hong, “Economic Growth in Asia: Determinants and Prospects,” Japan and the World Economy, Vol. 24, No. 2, (March 2012), pp. 101-13; Paul Krugman, “The Myth of Asia’s Miracle,” Foreign Affairs, Vol. 73, No. 6, (Nov/Dec 1994), pp. 62-78; Malcolm Dowling, “Asia’s Economic Miracle: An Historical Perspective,” Australian Economic Review, Vol. 30, No. 1, (1997), pp. 113-23; István I.B. Benczes, “Rethinking Asia’s Economic Miracle: The Political Economy of War, Prosperity and Crisis,” Journal of International Relations & Development, Vol. 11, No. 3, (2008), pp. 317-19; Joseph E. Stiglitz and Shahid Yusuf, (eds.), Rethinking the East Asia Miracle (New York: Oxford University Press, 2001); Yumei Zhang, Pacific Asia The Politics of Development (London: Routledge, 2003); Mark T. Berger and Douglas A. Borer (eds.), The Rise of East Asia (London: Routledge, 1997). 
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  70. Rory Medcalf, “Bold on Vision, Short on Funding,” The Australian October 29, 2012.
  71. Ibid.
  72. Ibid.
  73. Wesley, “The Politics of Exclusion: Australia, Turkey and Definitions of Regionalism,” p. 541.
  74. Fitzgerald, Is Australia an Asian Country, p. 2.
  75. Ibid. pp. 2-4.
  76. See: Michael Wesley, “There Goes the Neighbourhood,” (May 4, 2011), retrieved August 30, 2014, from

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