Opinion | Australia, the canary in Asia’s trade coal mine, may rue its slow escape from China’s sputtering economy

Did S&P just put a curse on Australia? The reference here is to the credit-rating equivalent of the magazine-cover jinx that companies and entire economies struggle to avoid.

On Friday, S&P made headlines by upgrading the outlook Down Under, reckoning that Canberra’s budget surplus will reappear by the “early 2020s.”

Great news for new Prime Minister Scott Morrison as he struggles to find his economic sea legs, you might say. It could just as easily signal a reverse karma effect – one with implications for Asia’s growth trajectory.

Granted, Morrison’s treasurer, Josh Frydenberg, forecasts a return to the black around 2020 if Australia can extend its run of 27 recession-free years.

But there are two gaping “ifs” standing in Canberra’s way: Donald Trump and Chinese demand for iron ore, copper, coal and Australia tour packages.

In one way, these two spoilers are connected. It’s US President Trump’s escalating trade war that is tossing China off balance.