A large, economically and politically powerful China is emerging, with consequences for regional and world order. The rules by which it and nations in the region engage one another are uncertain and the outcomes even less so. Europe must remain vigilant and engage to grow its influence in the area, writes Brendan Nelson.

Brendan Nelson is former Australian ambassador to the EU and NATO. He returned to Australia last month after spending three years in Brussels.

"The world has changed. It has changed in ways we may not yet fully comprehend. It won’t be changed back.

Last year, Yale’s professor of history and head of its International Security Studies Centre, Paul Kennedy, wrote that not only has the world changed, but we are moving from one age to another.

As evidence he offers, among other changes, the Asia Pacific’s move to centre stage.

Europe is only beginning to fully understand the scale and pace of the transformation in the Asia Pacific. Australia is looking at an Asian century and has just published a white paper on the subject.  

While appreciating the increasing importance of Asia and the need for Europe to coherently focus on it, a number of European officials have intimated to me that it will take time given other priorities. If that is the attitude Europe adopts, Asia may find Europe sooner than it thinks and in ways it might least expect.

The Asia Pacific is already home to more than half the world’s population.

In 1992 it was 22% of global economic output. By 2030 it will be 40%. In 1982 China’s economy was 9% that of the US; it is now half.

Five of the world’s economic powerhouses are in the Asia Pacific – US, China, India, Japan and the Republic of Korea.

Five of the world’s biggest militaries are there – US, China, Russia, India and North Korea.  Asia (not including Australia) will spend more on defence than Europe this year.

Concurrently, economic and trade interdependence is growing, including the ambition for a comprehensive regional economic agreement.

The region is stable, but potentially very unstable, replete with deep geostrategic uncertainties.

Anyone in Europe thinking this of little relevance should think again of disputes in the Korean peninsula, Taiwan Strait, Seas of Japan and East China, and Kashmir.

Think also of disputed territories in the South China Sea, through which passes most of Europe’s €700 billion trade with north Asia, or the Straits of Malacca through which passes 40% of the world’s trade and half its energy.

Should any conflagration emerge, the consequences for Europe and the global economy will be significant and sudden.

There are similarities between the Asia Pacific and late 19th century Europe after Germany’s unification.  Whilst we cannot be captive to history, we must learn from it.

Today a large, economically and politically powerful China is re-emerging with consequences for regional and world order. The rules by which it and nations in the region engage one another are uncertain and the outcomes even less so.

The most important relationship in the Asia Pacific - as globally - is that of the US and China. The template for it in this century is being forged now and it is being done in the region.

Australia is optimistic about China’s re-emergence and convinced of the need for a range of stable, rules-based multilateral structures for the advancement of common goals - and consideration of disagreement.

China’s priorities are to maintain economic growth to lift its people to a higher standard of living; the imperative is social stability. The second priority is to modernise its military, although China has no history of territorial acquisition, its borders being essentially those of the Han dynasty.

Its challenges are immense: urban pollution, collapsing age dependency ratios, energy and resource needs and the divide between rich and poor, to name a few.

From Beijing’s perspective, the last 160 years have been an aberration. It behoves all of us to help China re-emerge into the rules based world order which serves its interests as much as our own.

Attempts to base foreign policy on the export of Western ideology to China and other nations in Asia are not credible. But steadfastly believing in your own values is. The region respects strength.

The US has nominated its highest foreign policy priority for the 21st century as the Asia Pacific. This should be welcomed by anyone with an understanding of the transformational nature of global events.

This is not about the containment of China nor any other nation. Such an ambition would be as irresponsible as it is unachievable. It is about ensuring the US presence in the region, so indispensable to peace and prosperity, is strengthened in support of harmonious co-operation and dialogue. As such it is welcomed by nations in the region, including Australia.

Some Europeans expressed surprise at the US rebalance to the Asia Pacific. The best response will be to firstly understand why and then to substantially escalate Asian engagement.

The world needs a coherent European engagement with and understanding of - the Asia Pacific.

Not only do European nations need consistent, strong bilateral ties with nations in the region and multilateral forums such as ASEAN, we need coherence.

The region needs not only the US, but also the liberal democracies of Europe engaged with and supportive of, the structures it has created for regional harmony.  In this regard, High Representative Catherine Ashton’s attendance at this year’s ASEAN Regional Forum was as welcome as it is important.

So where is Australia coming from?

Australia built its foreign policy after world war two on several foundations: our alliance with the United States; our foundation membership of the United Nations (Australia will serve on the Security Council in 2013-14); an initially ambivalent relationship with Asia; and ties with Europe, principally the United Kingdom.

Having invested heavily in a peaceful Europe with the loss of 70,000 troops in two wars, Australia readily ‘signed on’ for Robert Schumann’s 1951 vision.

But when Britain joined the ‘common market’, we lost our major trading partner.  Australia’s political class was deeply scarred and embraced a Eurosceptic posture. Paradoxically though, those events forced us to open up, undertake painful economic reform and accelerate engagement with Asia.

We also redefined our relationship with the EU.

The global financial crisis; the G20 leaders level of global economic governance (of which we and the EU are members); passage of the Lisbon Treaty with its redistribution of patterns of authority in Brussels, including new powers in the parliament; and economic challenges in Europe and the US, all demanded meaningful Australian engagement with the EU.

Australia is a country unashamedly imbued with Western values, a middle power that sees a way forward in this new uncertainty. It is one that is neither appeasement at one extreme nor an apocalyptic clash of cultures at the other. But we have to work at it.

Europe’s influence, if it is to be maintained – let alone grow – will be determined by the capacity of its member states to work together.

Those nations founded on the principles of political, democratic and religious freedom, free academic inquiry and the co-existence of faith and reason need to work with one another more than at any other time.

The future we want and need depends on it."