In a report published today from the United States Studies Centre (USSC) at the University of Sydney, Australian experts call for a re-assessment of Canberra’s policy settings towards Taiwan to ensure they are fit-for-purpose amid current strategic pressures.

Over the course of 2025, the USSC convened a panel of 13 Australian foreign policy experts including former government officials, business leaders, and think tank and academic researchers and sought views on Australia’s policy architecture towards Taiwan. In Australia-Taiwan relations: Policy options and priorities for engagement, authors USSC Senior Defence Adviser Prof. Peter Dean, La Trobe Centre for Global Security Director Prof. Bec Strating, USSC Director of Economic Security Hayley Channer, Australian National University Professor of Strategic Studies Brendan Taylor and USSC Senior Research Associate Esther Soulard share the emerging themes from discussions with the panel of experts.

“The Australian debate on Taiwan has too often bifurcated its thinking along two main lines – Taiwan as a variable of Sino-US relations and Canberra’s relationship with Beijing. We need to move beyond frameworks that treat Taiwan solely as a risk factor for military conflict or as a function of great power competition,” said Prof Dean, “If our policy settings towards Taipei are to genuinely serve our national interests, we need to assess the bilateral relationship on its own merits – recognising Taiwan’s normative, technological and economic important to Australia’s strategic interests.”

The report explores three core dimensions of the bilateral relationship – economic cooperation, regional engagement, as well as security and defence ties – assessing the scope, opportunities and limits in deepening engagement in each. At an economic level, it outlines practical steps to strengthen trade, and technological and energy cooperation both within and beyond formal agreements.

“Taiwan is too often seen by Australians through the lens of regional contingencies and not as a top-10 export destination for Australian goods," Ms Channer noted, "Taiwan is a major energy partner of Australia and plays a pivotal role in global supply chains."

"There is untapped opportunity for Australia to strengthen its economic security via deeper engagement with Taiwan, and there's no better time than now," Ms Channer concluded.

The report also presents a suite of options for enhancing Australia’s engagement in the Indo-Pacific to help sustain a favourable regional balance of power. For defence and security, the it calls for a national conversation on the evolution of Australia’s strategic environment, emphasising the need for a whole-of-government approach to deterrence and to develop carefully risk-managed avenues for bilateral engagement that strengthen both Australia and Taiwan’s resilience.

Key policy recommendations

Trade relations and economic security

  • Seek and foster strategic alignment with likeminded countries to identify opportunities for Taiwanese engagement within the CPTPP framework.
  • Strengthen economic and trade relations outside formal trade agreements consistent with free trade principles, including through sub-national engagement, sister-city and sister-state partnership or leveraging existing cooperation frameworks.

Australia and Taiwan regional engagement in the Indo-Pacific region

  • Strengthen capacity to engage with Taiwan by improving literacy across the Australian Public Service, state and territory governments, academia, and civil society, socialising a clearer understanding of Canberra’s One-China policy.
  • Position Australia as a regional convenor in the Indo-Pacific region, through expanded Track 2 initiatives, good governance, cultural, indigenous, and digital diplomacy, as well as its conflict prevention and crisis management agenda.

Defence and security ties

  • Strengthen national-level preparedness and strategic understanding, elevating national awareness of the evolving strategic environment surrounding Taiwan – including Sino-US competition, PLA modernisation, and the implications of a Taiwan contingency.
  • Operationalise Australia’s whole-of-government approach to deterrence, through inter-agency planning and coordination to prepare and respond to possible contingencies, accounting for different variables and capacity-building across the ADF and public sector.

Media enquiries

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ussc.media@sydney.edu.au

This report was made possible with the generous support of the Taipei Economic and Cultural Office (TECO) in Canberra.

The report includes a Taiwan fact sheet by Lowy Institute Senior Fellow for East Asia Richard McGregor and Griffith University Asia Institute Industry Fellow and Australia Taiwan Business Council Vice Chair Rowan Callick OBE.