Australia needs a fourth pillar of foreign policy as great power pressure intensifies

As Australia’s Prime Minister and Foreign Minister spruik the nation’s middle power credentials in the United States this week, a new Lowy Institute Analysis argues Canberra should make middle power diplomacy an explicit fourth pillar of its foreign policy, alongside the US alliance, regional engagement, and the rules-based order.

Can the middle hold? Australian middle power diplomacy in a ruptured world order, by former diplomat Lachlan Strahan, argues that Australia can no longer rely on its default alignment with the United States or broad declarations of support for the rules-based order.

“Middle power diplomacy deserves a larger place in how Australia conceptualises its foreign policy,” writes Strahan. “Working with other middle powers provides Australia flexible options for pursuing its interests.”

He says coordination between middle powers provides “the capacity to resist great power coercion or decline a great power’s request without paying an unacceptable price”.

The paper points to two recent examples where Australia stood firm against Washington and emerged unscathed: Canberra’s refusal to send a naval vessel to join the United States’ operations against Iran, and its decision not to join President Trump’s Board of Peace.

Strahan’s Analysis highlights Australia’s free trade agreement and Security and Defence Partnership with the European Union, both signed earlier this year, and Canberra’s longstanding trade and security ties with Canada as evidence of successful middle power cooperation.

He also identifies Japan, South Korea, New Zealand, and India as important middle power partners with which Australia can work more closely. He also sees opportunities in broader coalitions, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Indo-Pacific Four, and issue-specific coalitions on Ukraine, maritime security, trade, climate, and institutional stewardship.

However, Strahan cautions that middle powers won’t — and indeed don’t want to — form a counter-hegemonic bloc and shouldn’t pretend they can replace the great powers.

But he says they can work “with, around, and sometimes against” the great powers to defend middle power interests and the institutions they rely on.

“Managing Australia’s foreign relations always entails choices,” Strahan writes. “But those choices should not be reflexive, automatic, or grounded in a priori assumptions.”

“Australia will often still choose the United States for sound national interest reasons. Some commentators argue, however, that it should abandon the alliance altogether. That, too, is a false binary choice.”

“The challenge is to stay nimble and clear-sighted about where the balance lies.”

KEY FINDINGS

• Middle power diplomacy should become the fourth pillar of Australia’s foreign policy, alongside the US alliance, engagement in our own region, and support for the rules-based order. It is already often latent in Australian practice. It should now be explicit.
  
• Middle power coordination cannot determine outcomes on questions of war and peace. What it delivers is optionality: the capacity to resist great power coercion or decline a great power’s request without paying an unacceptable price. Australia demonstrated this twice in 2026, on the Iran war and on Trump’s Board of Peace, and was punished for neither. It also allows middle powers to continue work on important international processes and norms when the great powers are either disengaged or resistant.
  
• Canadian Prime Minister Mark Carney was right that middle powers must band together, and wrong that the rules-based order is a fiction. The current assault on the multilateral system matters precisely because the system still matters. Although some of its parts are sclerotic or struggling, this system gives smaller states a voice, delivers public goods daily, and sets benchmarks most states still observe.
  
• Middle powers will not cohere into a counter-hegemonic bloc, and do not want to. They work with, around, and sometimes against the great powers, issue by issue. Claims beyond that are overselling.

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