ELECTIONS IN AUSTRALIA: BETWEEN TWO FIRES, BETWEEN TWO WORLDS

The victory of the Labor government confirms the course already set. But Australia’s dilemmas — torn between Western alliances, Asian integration and internal fragilities — remain unresolved.

On Saturday 3 May 2025, Australia voted for continuity. Anthony Albanese secured a second term in office, comfortably defeating a struggling conservative opposition and, for now, shelving the prospect of a return to more combative, divisive politics.

The personal loss suffered by Peter Dutton, leader of the Coalition — who failed to retain even his own seat — came to symbolise an election in which caution triumphed over confrontation.

Yet beyond the electoral drama, the result draws fresh attention to Australia’s geopolitical balancing act — a middle power positioned on the edge of the Indo-Pacific, now the epicentre of global competition.

A Western Nation in an Asian Neighbourhood

Australia is a Western democracy embedded in an Asian context.

It is a formally multicultural society that has yet to heal the wounds of its colonial past.
It remains a steadfast ally of the United States, while at the same time relying heavily on China for its economic wellbeing.

To truly understand this country, electoral percentages alone aren’t enough. One must consider its geography, its historical memory, and the difficult choices it faces in the years ahead.

A Strategic Island-Continent on a Geopolitical Fault Line

Geographically isolated yet strategically pivotal, Australia holds a unique position on the world map. It faces what some analysts call the “Australasian Mediterranean” — the vast expanse stretching from Southeast Asia to Oceania — now a stage for intensifying rivalry between the United States, China, and rising powers like India and Indonesia.

Canberra remains firmly anchored to the West. Since the Second World War, Australia’s security has been guaranteed by the United States.

It is a member of the Five Eyes intelligence alliance, hosts the critical Pine Gap surveillance base, and plays an active role in AUKUS (alongside the US and UK) and the Quad, a strategic dialogue that also includes India and Japan.

Economic Ties to Asia, Roots in the West

Strategically, Australia stands with the West — but economically, the picture is more complex. China remains its largest trading partner, importing key Australian exports such as coal, gas, critical minerals, and agricultural goods. In return, Canberra has found itself entangled in a form of strategic dependency that is not easily unwound.

More broadly, Australia is deeply embedded in the regional trade architecture.

It is a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) — which the UK acceded to last year — and the Regional Comprehensive Economic Partnership (RCEP), both of which tie it firmly to the Asian economic sphere. In trade terms, Australia is now deeply enmeshed in the fabric of Asia.

The Labor government has sought to navigate this dual identity through a mix of firm military posture, pragmatic diplomacy, and economic diversification. But this is a delicate balancing act.

Any escalation — whether in the Taiwan Strait or the South China Sea — could force Canberra to choose sides. The experience of strained relations with Beijing under the Morrison government, which led to severe trade disruptions, still serves as a cautionary tale.

China’s Quiet Push into the South Pacific

For years, Australia wielded near-hegemonic influence across the South Pacific, a region long viewed as its strategic backyard. Today, that dominance is being quietly challenged by a steady, calculated Chinese presence.

One of Beijing’s core objectives is to break the strategic encirclement posed by the United States and its allies along the so-called “first island chain.” To that end, China is extending its reach southward, leveraging the institutional and infrastructural vulnerabilities of small Pacific nations.

Beijing offers attractive packages of economic and technical support — concessional loans, infrastructure projects, medical and technological aid, training programmes — alongside a narrative that stresses respect for national sovereignty. In return, it gains diplomatic backing in multilateral forums, access to local markets, and in some cases, entry points to dual-use facilities and ports.

A case in point is the 2022 agreement signed with the Solomon Islands, which permits the deployment of Chinese personnel at the request of the local government for public order or humanitarian assistance. While the text does not formally authorise a permanent military base, the provisions have triggered alarm in both Canberra and Washington, raising fears of a long-term Chinese foothold in the region.

Australia’s Response: Investment, Soft Power, and Credibility

In response to China’s expanding presence, Australia has ramped up its regional development efforts — channelling funds into infrastructure, offering scholarships, expanding training programmes, and promoting cultural initiatives grounded in shared histories and regional identity.

But the competition in the Pacific is not solely economic. Increasingly, it is also a question of trust. Neighbouring nations are watching closely to see whether Australia lives up to the inclusive values it champions abroad.

And it is here that the country’s internal weaknesses come into sharper focus.

An Unfinished Identity

Australia’s national identity remains a work in progress.

While popular imagination celebrates the “Aussie battler” — the egalitarian, resilient everyman — the reality is far more complex.

The country’s social structure still bears the imprint of its Anglo-Celtic foundations, with a political, economic, and military elite that reflects its colonial heritage. Over time, this has produced policies of exclusion and discrimination: from the White Australia Policy, which restricted non-European immigration, to the forced assimilation of Indigenous peoples, including the traumatic legacy of the “Stolen Generations” — Aboriginal children removed from their families to be raised under white cultural norms.

These historic wounds are still visible today, in social inequalities and the under-representation of minority communities in public life.

Identity Tensions and Geopolitics

Despite presenting itself as a multicultural society, identity tensions in Australia have never fully disappeared.

The country now welcomes an increasing number of immigrants from Asia, yet communities from China, the Philippines, and India remain underrepresented in institutional and decision-making spaces.

The failure of the 2023 constitutional referendum, which sought to formally recognise Indigenous peoples, exposed the fragility of Australia’s social fabric.

These internal dynamics are not merely a domestic issue; Australia’s external projection depends significantly on its ability to be seen as an inclusive and just society. A nation that struggles to manage its internal diversity risks loses credibility in its regional ambitions and undermines its diplomatic and cultural influence.

India as a Strategic Ally

In its efforts to counterbalance China’s growing influence, Australia has strengthened its partnership with India, seen as a key strategic ally in building a resilient, multipolar Indo-Pacific.

Both nations share common concerns about China’s expansionism, while having mutual interests in areas such as maritime security, regional connectivity, and strengthening alternative supply chains.

Australia and India are both members of the Quad, a strategic forum that also includes the United States and Japan. In recent years, the two countries have stepped up joint military exercises, such as those in the Malabar series, and signed agreements on defence cooperation and enhancing cooperation in wider areas.

Moreover, the growing Indian community in Australia serves as a cultural and social bridge, as evidenced by Indian Prime Minister Modi’s visit to Australia in May 2023.

Looking ahead, India is poised to play an increasingly important role for Canberra, helping diversify its foreign relations and reduce, at least in intent, its dependence on China.

Stability Today, Uncertainty Tomorrow

With Albanese’s re-election, the Australian government has secured a period of political stability, enabling it to continue along its current trajectory: a moderate foreign policy, attention to welfare, and a focus on energy transition at home. However, the strategic challenges remain unresolved.

Australia continues to find itself suspended between two fires — and two worlds: a democracy looking to the future but still reckoning with its past. A middle power with regional ambitions, but one that is bound by a network of global alliances and dependencies that limit its strategic autonomy.

In the short term, Australia will likely try to maintain a constructive ambiguity between China and the United States. But ongoing demographic shifts and the mounting geopolitical pressures could make it increasingly difficult for the country to maintain this delicate balance.