Annual Report 2003-2004
 

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Your location: Performance > Outcome 1 > Output 1.1 > 1.1.3 Americas and Europe

OUTPUT 1.1: Protection and advocacy of Australia’s international interests through the provision of policy advice to ministers and overseas diplomatic activity

1.1.3 Americas and Europe

On this page: Overview :: United States :: Europe :: Canada :: Latin America

Overview

The department intensified Australia's links with major allies on both sides of the Atlantic. We redoubled our efforts to deal with threats to the international security environment through sustained consultations with the United States, the European Union (EU) and European countries. We initiated a strategy for closer cooperation with the North Atlantic Treaty Organisation (NATO).

Australia's engagement with the United States remains at an historically high level. The department's advocacy across a diverse agenda amplified Australia's influence with decision-makers in the United States, our most important security and economic partner. Successful negotiation of the Australia–US Free Trade Agreement (AUSFTA) was a highlight. A major program of high-level visits reaffirmed the mutual significance of the relationship.

The breadth of our exchanges with the EU and its member states reflected our productive partnership with an increasingly influential grouping in the international arena. A vigorous work program augmented our constructive engagement in a diverse range of areas where Australia shares common interests with the EU, as well as areas where we diverge.

The department concluded a number of agreements to improve the flow of trade, and helped exporters by working to improve access to markets in the Americas and Europe. We engaged key players intensively to advance our multilateral trade objectives, particularly in relation to agricultural trade liberalisation in the Doha Round. We broadened advocacy of our bilateral and multilateral trade interests with the EU, including through a comprehensive trade policy dialogue with the European Commission in April 2004.

United States

The department, together with other government agencies, worked closely with counterparts in the United States to bring about an international response that would support Iraq's transition to self-government. We also worked with the United States in international efforts to combat the spread of weapons of mass destruction, including through the International Atomic Energy Agency (IAEA) and the Proliferation Security Initiative. We strengthened Australia–US cooperation on counter-terrorism, including securing US support for the Jakarta Centre for Law Enforcement Cooperation. We encouraged greater intelligence sharing and greater interoperability of Australian and US armed forces (see sub-output 1.1.8 for more information).

The department led negotiations for the AUSFTA, which Mr Vaile and his counterpart, United States Trade Representative Bob Zoellick, signed on 18 May 2004. This historic agreement, once entered into force, will strengthen trade and investment with Australia's most important economic partner. We worked to secure US Congressional approval of the agreement through intense lobbying of decision-makers in Washington and by providing support for the direct advocacy of the Prime Minister, Mr Downer and Mr Vaile. We hosted seven Congressional staff delegation visits to Australia to support the AUSFTA and to promote Australia as a dynamic economic partner for the United States (see sub-output 1.1.5 for more information).

High-level visits remained an essential element in affirming shared interests. The department supported President Bush's first visit to Australia in October 2003 and the Prime Minister's visit to the United States in June 2004. Mr Downer visited the United States twice, meeting Secretary of State Colin Powell and other senior US leaders. Mr Vaile visited the United States six times to negotiate the free trade agreement and promote Australian exports and investment. The department also assisted with visits to the United States by eight other federal ministers, deepening the bilateral partnership in a range of areas.

We improved Australia's economic links with California—the world's fifth largest economy in its own right—through an Australia Week festival (G'day LA) in January 2004, which was conducted by our post in Los Angeles and attended by Mr Downer. The fifteen events allowed over 100 Australian companies to meet with representatives of over 250 US companies in industry, films and the arts.

FIGURE 10. Australia's trade in goods(a) and services with the United States (TEXT DESCRIPTION)

FIGURE 10. Australia's trade in goods(a) and services with the United States

(a) Goods data is on a recorded trade basis.

Source: DFAT Stars database.

North Atlantic Treaty Organisation (NATO)

We continued our exchange with high-level NATO representatives to register Australian perspectives on developments in our own region and our interests in transatlantic and European security-related issues. Our consultations helped to factor Australian views into the deliberations of key partners individually as well as one of the most powerful multilateral security alliances.

We secured a positive response from members of the North Atlantic Council—NATO's principal decision-making body—to develop closer cooperation with Australia in areas of mutual interest, such as counter-terrorism, countering proliferation of weapons of mass destruction and improving military interoperability. Mr Downer's address to the North Atlantic Council in Brussels in May 2004—in which he detailed Australia's views on possible areas for such cooperation—was an historic first for a non-NATO foreign minister.

Europe

European Union

Photo - See caption below for description
Australian Ambassador to Denmark, Matthew Peek, greeted Her Majesty Queen Margrethe of Denmark on her arrival at an official dinner hosted by the Governor-General of the Commonwealth of Australia, His Excellency Major General Michael Jeffery AC CVO MC (Retd) on the occasion of the Danish royal wedding in May 2004. Photo: Steen Brogaard.
Enlarge image :: Photo gallery

The department pursued an ambitious work program with the EU ahead of its expansion from 15 to 25 member states in May 2004. The Australia–European Union: an agenda for cooperation—adopted in 2003—served as a powerful vehicle to deepen our engagement in headline areas: security and strategic issues; trade; education and science and technology; transport; environment; development cooperation; and migration and asylum. Mr Downer and the European Commissioner for External Relations, Mr Chris Patten, endorsed the progress achieved in these areas at Australia–European Commission Ministerial Consultations held in May 2004.

We intensified our exchanges with Europe on counter-terrorism and on regional initiatives to bolster stability and good governance in the Asia–Pacific. We achieved this through support for Mr Downer's consultations with the EU Italian Presidency in October 2003 and the EU Irish Presidency in January 2004. We worked through the Australia Group to evaluate the membership of the new EU member states in export control regimes to reinforce non-proliferation (see sub-output 1.1.8 for more information).

Working with other agencies, the department encouraged closer partnership on development cooperation with the EU, the world's largest aid donor. This will result in greater complementarity of aid delivery, particularly in the South Pacific. Our advocacy, in concert with AusAID, helped secure a commitment by the EU to provide significant new resources to stabilisation in Solomon Islands and resume its aid to Fiji. The department provided support for the visit to Australia and the Pacific by European Commissioner for Development and Humanitarian Aid, Mr Poul Neilson, in January 2004. We participated in the inaugural Australia–EU Development Dialogue led by AusAID in April 2004.

The department maintained a high level of advocacy on agricultural reform with the EU and its member states, and worked to ensure EU leaders understood Australia's objectives in the World Trade Organization (WTO) Doha Round. In consultations in May 2004 with European Commissioners for Trade, Mr Pascal Lamy, and for Agriculture, Dr Franz Fischler, Mr Vaile pressed the case for a significant outcome on agriculture as crucial to the successful conclusion of the Doha Round.

As a result of EU enlargement, the department is engaged in ongoing WTO negotiations to maintain market access or seek offsetting benefits for Australian exporters in the ten new member states. Adoption of the EU economic and trade systems has resulted in deterioration in market access for some Australian goods in these countries.

Our advocacy was effective in improving access to EU markets for Australian exports. Following intensive lobbying by posts in key European capitals, exporters of Australian rock lobster were able to access the large EU market by means of an autonomous tariff quota. This enabled the import of 1500 tonnes of frozen rock lobster for further processing at six per cent duty—well down on the usual 12.5 per cent tariff. In February 2004, the EU agreed to extend the autonomous tariff quota until the end of 2006. We lobbied intensively against the reintroduction of EU export subsidies on pigmeat. They were subsequently withdrawn.

The department lobbied to protect Australian interests in the context of new EU regulatory regimes. We made extensive representations in support of Australian commercial interests, including on possible adverse consequences of the EU Takeovers Directive and the EU maritime transport guidelines. We established a regular forum with other government agencies and industry representatives to work on two fronts: examining potential impacts of the European Commission's draft industrial chemicals legislation, and developing strategies to ensure Australian interests are factored into EU deliberations on its final chemicals regime.

The department continued to support efforts under the Australia–European Commission Wine Agreement to finalise outstanding issues. The Wine Agreement seeks to facilitate wine exports to the EU by addressing issues such as the authorisation of wine-making practices, and labelling requirements. While the European Commission sought to advance the negotiations after a period of delay, it was not possible to resolve all issues this financial year. In October 2003, the European Union—known as the European Communities in the WTO—requested a dispute-settlement panel in its WTO dispute against Australia's quarantine regime for imports (see sub-output 1.1.5 for more information).

FIGURE 11. Australia's trade in goods(a) and services with the European Union (TEXT DESCRIPTION)

FIGURE 11. Australia's trade in goods(a) and services with the European Union

(a) Goods data is on a recorded trade basis.

Source: DFAT Stars database.

Europe—bilateral relationships

Complementing our focus on advancing our interests with a larger, more complex EU and an expanded NATO, the department devoted substantial resources to developing our partnerships with individual European countries.

We continued to deepen our strategic and intelligence links with the United Kingdom through frequent high-level discussions that focused on responses to challenges and threats in the international security landscape. We supported the Prime Minister's and Mr Downer's participation in the inaugural session of the Australia–UK Leadership Forum in November 2003. We continued our close and constructive cooperation with the UK Government to secure the repatriation of indigenous remains. Our post's efforts helped ensure timely completion of the Australian War Memorial in London, which was dedicated by the Prime Minister in November 2003.

The department was instrumental in organising high-level contacts between Germany and Australia that promoted Australia's strategic objectives. We supported Mr Downer's participation at the Berlin Ministerial Conference on Afghanistan in March–April 2004 and consultations with the Foreign Minister, Mr Joschka Fischer, in April 2004. This underscored our commitment to broaden support for regional stability among countries in Europe. We supported the Governor-General's first official visit to Germany in May 2004, during which he opened Weinwoche 2004 (Wine Week 2004) promoting Australia's wine and gourmet food. We assisted with the visit to Australia by the Premier of Baden-Wúrttemberg in February–March 2004, which resulted in a university cooperation agreement with South Australia, and promoted commercial links in biotechnology, telecommunications and mining machinery, and underlined Australia's attractiveness as a location for German investment.

We worked closely with France in developing and extending cooperation on a broad range of issues, particularly in maritime cooperation activities in the South Pacific region and Southern Ocean.

The department also took forward our strategic dialogue with Switzerland and Norway. Our support for visits by the Minister of Defence, Senator Hill, strengthened defence and security dialogue with Sweden and Turkey. We promoted Australian exports, art and culture through broad-ranging activities in Denmark at the time of the wedding of the Crown Prince to Ms Mary Donaldson in May 2004.

The department assisted the work of the Special Envoy for Cyprus in support of international efforts to reunite Cyprus. In the wake of the failure of the 24 April 2004 referenda to achieve this outcome, we maintained support for the UN's peace-keeping operations on the divided island.

We worked closely with Turkey to secure a safe environment for Australians attending Anzac Day commemorations at Gallipoli. We developed strong cooperative relations with Greece on security responses to safeguard Australian citizens and athletes attending the 2004 Olympic and Paralympic Games in Athens (see also Outcome 2). We supported Australian firms bidding in Greece for Olympic Games-related contracts. Australian companies are providing merchandise, accommodation, sporting equipment, engineering, training and cleaning services for the Games and were also responsible for the manufacture and supply of the Olympic torch.

The department sought to break down regulatory barriers to trade with Russia through contributing to the conclusion of a double taxation agreement, which came into effect on 1 July 2004. We worked with other agencies to start negotiations on a bilateral veterinary cooperation agreement to improve access for Australian meat exporters to the Russian market. We supported two Austrade-led trade missions to Sakhalin Island in the Russian Far East that resulted in over $30 million in new Australian exports. As part of negotiations on Russia's accession to the WTO, we sought improved market access to Russia for Australian exporters.

We continued to develop Australia's network of formal arrangements with European countries. This included a review of the double taxation agreement with the United Kingdom, our work with other agencies to conclude working holiday-maker arrangements with Italy in October 2003 and France in November 2003 and efforts to bring into force our agreement with Belgium. We also made progress in negotiations for working holiday-maker arrangements with Greece and Estonia.

TABLE 7. Australia's trade in goods and services with Europe
  Export Export   Import Import  
Goods(a) and Services CY2002
$m
CY2003
$m
Trend
Growth
1998–2003
CY2002
$m
CY2003
$m
Trend
Growth
1998–2003
United Kingdom 9 340 11 188 9.6% 9 504 9 130 0.3%
Germany 2 386 2 086 1.2% 8 617 9 152 7.4%
Italy 2 297 1 811 1.7% 4 238 4 574 7.0%
France 1 787 1 409 8.1% 3 710 4 380 12.2%
Netherlands 1 697 1 654 7.1% 1 637 1 741 3.7%
Total European Union 21 129 21 809 5.9% 36 664 38 385 5.7%
Total East Europe 575 613 3.1% 584 608 16.5%
Other Europe 1 964 1 691 -3.6% 3 390 3 261 4.6%
Total 23 668 24 113 4.9% 40 638 42 254 5.7%

(a) Goods data is on a recorded trade basis.
Source: DFAT Stars database and ABS International trade in services by partner country 2003.

Canada

The department helped maintain access for Australian food products to Canada, including canned peaches and honey, through lobbying on behalf of Australian companies and working with the Canadian authorities to resolve quarantine issues. We helped secure an additional 2000 working holiday and student work-abroad visas for young Australians visiting Canada, an important means to strengthen our people-to-people links. The second meeting of the Canada–Australia Dialogue, in which the two countries share public policy perspectives, was delayed by political transition in Canada.

Latin America

The department supported the Council on Australia Latin America Relations (COALAR) as a vehicle to promote Australian commercial, educational and cultural interests in Latin America. In addition to trade-related activities, COALAR hosted a Latin American student seminar to increase awareness of the benefits of studying in Australia. The government renewed COALAR for another three years (see Outcome 3 for more information).

We contributed, through our advocacy of Australian products, to a $100 million increase in Australian merchandise exports to Brazil, our largest Latin American trading partner. We also facilitated the visit of Queensland Premier Beattie to Brazil, which raised new opportunities for Australian mineral and services exports.

The department worked vigorously to ensure that our bilateral nuclear cooperation and safeguards agreement with Argentina remained on the legislative agenda of the Argentine Congress. This agreement will facilitate opportunities for research and other collaboration with Argentina stemming from the construction by a consortium headed by an Argentinian company of a replacement research reactor at Lucas Heights in Sydney. We helped Australian companies achieve a marked increase in exports of animal genetic products to Argentina.

The department continued to build on the strong political and commercial relationship we have fostered with Chile. This included promoting Australian goods and services during ministerial visits associated with Chile's hosting of APEC 2004 and supporting high-level Chilean ministerial and congressional visits to Australia. We also provided advocacy on behalf of Australian mining companies in respect of the proposed introduction of a new mining royalty.

The department continued to forge strong links with Mexico, supporting successful negotiation of agreements on double taxation, mining and education. Through promotional activities, we contributed to a significant increase in wine sales. We promoted Australian LNG as a means of meeting Mexico's growing energy demand and developed a long-term strategy for increasing Australian meat exports.

The department relocated the mission in Bridgetown in Barbados to Port of Spain in Trinidad and Tobago to better support Australia's commercial interests in the Caribbean. Following a review of Australia's overseas representation, and in order to adjust global resources to meet new priorities, the department closed its post in Venezuela.

TABLE 8. Australia's trade in goods and services with the Americas
  Export Export   Import Import  
Goods(a) and Services CY2002
$m
CY2003
$m
Trend
Growth
1998–2003
CY2002
$m
CY2003
$m
Trend
Growth
1998–2003
United States 16 278 14 228 3.7% 29 229 26 683 0.2%
Canada 2 292 2 149 7.4% 2 112 2 178 2.9%
Mexico 453 466 11.7% 550 621 12.1%
Total NAFTA 19 083 16 860 4.3% 32 140 29 743 0.7%
Total Caribbean 203 155 1.6% 535 544 25.5%
Brazil(b) 401 463 0.1% 467 484 7.8%
Chile 165 136 -7.3% 166 208 16.1%
Argentina(b) 64 87 -10.0% 174 189 23.1%
Total South America(b) 838 847 -0.7% 853 938 13.1%
Total 20 317 18 061 3.8% 33 743 31 510 1.1%

Source: DFAT Stars database and ABS International trade in services by partner country 2003.

(a) Goods data is on a recorded trade basis.

(b) Data for merchandise trade only, services data is not available.

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Department of Foreign Affairs and Trade Annual Report 2003–2004
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