How can Australia operate effectively in Asia if fewer Australians can speak regional languages, understand political and cultural dynamics, or build enduring relationships across the region? This question lies at the heart of debates over the nation’s Asia capability and has gained renewed urgency following submissions to the recent parliamentary inquiry into building Asia capability in Australia.
For more than three decades, successive Australian governments have recognised that meaningful engagement with Asia requires far more than trade agreements or high-level visits. It depends on sustained investment in people, languages, institutions and long-term networks that enable Australians to interpret regional dynamics and navigate effectively across the region.
On paper, Australia, an export-based economy, is well placed to develop such capability. Its geographic proximity to Asia, strong trade and investment links, extensive people-to-people connections – reinforced by waves of Asian migration, with nearly one in five Australians reporting Asian ancestry – provide a solid foundation that many other Western powers lack. In 2024, most of Australia’s major trading partners were Asian economies.
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Despite this, Australia’s Asia capability has steadily declined. This erosion is driven by interconnected domestic factors, including narrow policy horizons, budget constraints, insufficient teacher and professional pipelines, minimal incentives for deep Asia literacy, and a broader societal underemphasis on the region.
Language education exemplifies this decline. A 2012 white paper’s aim was for all students to be able to study an Asian language continuously by 2025. Yet, as the Business Council of Australia has pointed out, Year 12 enrolments in Chinese, Japanese, Vietnamese and Indonesian – the official languages of key trading partners – are at their lowest level in a decade. University enrolments in Bahasa Indonesia plummeted by a shocking 76 per cent between 2004 and 2022, according to the Australian Consortium for In-Country Indonesian Studies.
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These domestic trends intersect with a persistent tension at the heart of Australia’s foreign policy. Economic prosperity is increasingly tied to Asia, while security remains anchored to the United States, exposing a fundamental imbalance in Australia’s strategic posture.