Annual Report 2004-2005
 

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1. Overviews2. Performance3. Corporate4. Appendixes5. Financials6. Glossaries and Compliance Index

Your location: Performance > Outcome 1 > Output 1.1 > 1.1.4 South Pacific, Middle East and Africa

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

1.1.4 South Pacific, Middle East and Africa

On this page: Overview :: New Zealand :: Papua New Guinea :: Solomon Islands :: Fiji :: Vanuatu :: Nauru :: Pacific Islands Forum :: Iraq :: Middle East :: Africa

Overview

The department contributed strongly to Australia's efforts to improve governance and security in the South Pacific, particularly through coordination of the Regional Assistance Mission to Solomon Islands and the Enhanced Cooperation Program in Papua New Guinea. We coordinated the participation of three Australians in the international monitoring mission for the election of the first autonomous government for Bougainville, a historic step forward in a process Australia has supported for a number of years.

We also played a central role in coordinating whole of government Australian policies to deal with instability in Vanuatu and to encourage economic and governance reform in Nauru.

The department ensured that the terms of reference for the draft Pacific Plan reflected the Pacific Islands Forum's goals of economic growth, good governance, security and sustainable development and that the draft plan included Australian proposals to support the pooling of regional resources, including in aviation, law enforcement and security.

In cooperation with the Attorney-General's Department, AusAID and the Government of New Zealand, the department encouraged Pacific island countries to take up offers of assistance from Australia and other donors to adopt and implement legislation on counter-terrorism and transnational crime. We provided direct assistance to facilitate island countries' compliance with counter-proliferation obligations.

Iraq's political transition, internal security and rehabilitation remained a key policy priority for the Government. The department's Iraq Task Force coordinated whole of government policy formation. The department led the response to several high-profile challenges, including hostage-takings, a bomb attack on our Baghdad embassy, and the resolution of a dispute about claims of contamination of Australian wheat exports.

The department advanced Australia's trade and investment interests in the South Pacific, the Middle East and Africa. Notable outcomes included the launch of negotiations for an Australia–UAE free trade agreement and the agreement of Pacific Islands Forum trade ministers to a study that will help prepare the ground for possible free trade agreement negotiations between Forum island countries, Australia and New Zealand. We played a significant role in the negotiation of a memorandum of understanding with Eritrea on agricultural cooperation and live animal trade, signed on 29 April 2005.

Iran continued to engage the department's attention because of increasing concerns about its nuclear program and Australia's trade and other bilateral interests there.

The department continued to advocate a just and comprehensive peace settlement in the Middle East and to encourage progress on the Gaza disengagement process.

A new embassy was established in Kuwait to help manage our growing strategic and commercial relationship with Kuwait. The department also worked with Austrade on opening a consulate-general in Libya as a first step towards opening an embassy.

The department coordinated Australia's responses to the crisis in Darfur, Sudan and the Zimbabwe government's continuing disregard for human rights.

New Zealand

The department led negotiations with New Zealand to reform the rules of origin under the Closer Economic Relations (CER) agreement to reduce business compliance costs and bring greater efficiencies to both economies. Ministers from both sides announced the reform initiative at the annual Closer Economic Relations (CER) ministerial meeting in Queenstown, which the department helped organise. At the CER meeting ministers also resolved the wine equalisation tax rebate issue, which had caused tension in the bilateral trading relationship.

The department played a key role in Australia's hosting of the second Australia– New Zealand Leadership Forum, held from 29–30 April 2005 in Melbourne. The Forum brought together more than 80 delegates from government and business in Australia and New Zealand, including Mr Downer and the Treasurer, Mr Costello. This year's Forum deepened the level of engagement between ministers, senior officials and the business sector, with discussion focusing on the two governments' single economic market initiative, regulatory harmonisation and our respective FTA negotiations.

FIGURE 12. AUSTRALIA'S TRADE(a) IN GOODS AND SERVICES WITH NEW ZEALAND

FIGURE 12. AUSTRALIA'S TRADE(a) IN GOODS AND SERVICES WITH NEW ZEALAND
(a) Goods data is on a recorded trade basis.

Source: DFAT, STARS database; ABS Regional services data 2003.

Papua New Guinea

The department coordinated the implementation of Australia's commitments under the Enhanced Cooperation Program (ECP), established by the Australian and PNG Governments in 2004 to remove key impediments to PNG's development.

ECP's central focus was the provision of Australian police and public servants to work within PNG government agencies. By May 2005, 154 police and 43 public servants were deployed in PNG to focus on law and order, legal reform, economic and financial management, and border and transport security.

These efforts received a setback on 13 May 2005 when the PNG Supreme Court ruled that elements of the PNG legislation underpinning ECP, including the legal basis for Australian police to exercise police powers, were unconstitutional. Australian police were withdrawn and a number of public servants were shifted from 'line' positions in PNG government agencies to advisory roles. The department worked actively with PNG officials on new arrangements, helping ministers reach in-principle agreement on a revised ECP.

The department coordinated the participation of three Australians in an international mission to observe the historic election of the first autonomous government for Bougainville. The Australian observers were Mr Andrew Laming MP, Member for Bowman; Ms Marie Neilson, Deputy Electoral Officer for Tasmania; and Ms Sue Langford from the department. The mission concluded that the election result reflected credibly the wishes of the people of Bougainville. The outcome is a significant step forward in the peace process to which Australia has given substantial practical and financial support over a number of years, including its leadership of the Bougainville Peace Monitoring Group from May 1998 to June 2003.

TABLE 9. AUSTRALIA'S TRADE IN GOODS AND SERVICES WITH THE SOUTH PACIFIC, MIDDLE EAST AND AFRICA
  Export Export   Import Import  
Goods(a) and Services 2003
$ million
2004
$ million
Trend Growth
1999–2004
2003
$ million
2004
$ million
Trend Growth
1999–2004
New Zealand and Territories 10 561 11 365 6.0% 6 810 6 940 4.1%
Papua New Guinea 1 141 1 269 -2.4% 1 677 1 786 5.2%
Other Pacific Islands 1 736 1 469 -2.6% 1 122 1 219 3.2%
Middle East (b) 5 321 5 918 7.2% 4 147 4 731 13.6%
South Africa 1 579 1 870 8.3% 1 427 1 523 12.5%
Other Africa (c) 1 359 2 042 6.4% 511 556 0.8%
Total 21 698 23 933 5.1% 15 701 16 598 6.5%

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

(b) Excluding Egypt. No services data for 1999.

(c) Including Egypt.

Source: DFAT Stars database and ABS International trade in services by partner country 2004.

Solomon Islands

The department successfully coordinated Australian contributions to the Regional Assistance Mission to Solomon Islands (RAMSI), including the transition from the first phase to stabilise law and order and government finances to a second phase of longer-term strengthening of national infrastructure and institutions. This whole of government effort helped reinforce Solomon Islands' commitment to RAMSI and to vital reforms, including in economic governance and public sector management.

Through its chairing of regular inter-agency meetings on political, security, legal and economic issues affecting RAMSI's operations, the department helped RAMSI manage a number of complex and sensitive issues, in consultation with the Solomon Islands Government. The sense of partnership between RAMSI and the Solomon Islands Government was strengthened by the close and effective relations that the Office of the Special Coordinator and the Australian high commission developed with key political figures.

The department maintained and nurtured a high level of engagement by New Zealand and Pacific island countries. Eleven countries have now contributed personnel to RAMSI. Partner countries are kept informed through monthly reports, regular briefings provided by Australia's diplomatic missions and periodic presentations by the RAMSI Special Coordinator. The department played a central role in facilitating a review of RAMSI by a Pacific Islands Forum Eminent Persons Group (EPG). During its visit to Solomon Islands, the EPG highlighted RAMSI's achievements, noted the strong support for RAMSI on the part of the people of Solomon Islands and reaffirmed the ongoing commitment of Pacific island countries to the mission.

The department led efforts to communicate RAMSI's achievements and explain its forward program. The office of the Special Coordinator and the Australian high commission used the media, speeches and briefings to explain to Solomon Islanders the need for economic and machinery of government reforms, and for the strengthening of accountability institutions.

Fiji

The department took the lead in promoting a whole of government approach to delivering messages to the Fiji Government about the importance of political stability and genuine reconciliation. An example was our careful and constructive reaction to the Reconciliation, Tolerance and Unity Bill, in which we encouraged the Fiji Government to look at adopting a more open and flexible approach to possible changes to the bill. We stressed to the Fiji authorities that any amnesty provisions in the bill relevant to those involved in the 2000 coup should not compromise legal processes and the accountability of individuals for their actions. The Fiji Government has indicated a willingness to consider changes to the bill.

Australia succeeded in securing agreement to extend the textiles, clothing and footwear (TCF) component of the South Pacific Regional Trade and Economic Cooperation Agreement. At the same time, we promoted realistic expectations of the level of assistance we can provide in supporting Fiji's TCF industry.

Vanuatu

The department was instrumental in coordinating a whole of government approach to dealing with the instability created by the policies of then Prime Minister Vohor, whose government attempted to wind back governance and economic reform and to expel Australian advisors. In consultation with other agencies, we developed a strategy that involved delivering firm messages to the Vohor government that Australia would review the bilateral relationship, including possible reductions in our aid program, if the Prime Minister continued to renege on commitments made by previous Vanuatu governments to good governance and economic reform. Vohor's government was removed by a motion of no-confidence in December 2004. During a visit to Vanuatu that same month, Mr Downer signed a Statement of Joint Principles with the new government of Prime Minister Lini that committed the Vanuatu Government to good governance and economic reform.

Nauru

The department played a central role in coordinating government policy aimed at encouraging economic and governance reform in Nauru. Finance and police teams were deployed to Nauru in 2004 and have made impressive progress in promoting economic reform and rebuilding the Nauru Police Force. The department prepared a four-year strategy of engagement with Nauru that was agreed by ministers in June 2005. The strategy is designed to help rebuild the country and create a viable and self-sustaining economy. Included in this strategy is funding to refurbish Australia's temporary consulate-general in Nauru.

Pacific Islands Forum

The Government secured successful outcomes at the Pacific Islands Forum leaders' meeting in Apia in August 2004. These included adoption by leaders of principles to improve the governance of regional transport services and terms of reference for a Pacific Plan to strengthen regional cooperation and integration. In cooperation with AusAID and the Department of the Prime Minister and Cabinet, the department drafted the Forum Principles on Regional Transport Services. We worked with the Pacific Islands Forum Secretariat to ensure that draft terms of reference for the Pacific Plan reflected the Forum goals of economic growth, good governance, security and sustainable development. The draft Pacific Plan, which the department is helping to develop, includes Australian proposals to support the pooling of regional resources, including in aviation, law enforcement and maritime security.

The department advanced Australia's trade interests in the South Pacific, including through agreement by Forum trade ministers in May 2005 to a study that will help prepare the ground for possible free trade agreement negotiations between Forum island countries, Australia and New Zealand.

In cooperation with the Attorney-General's Department, AusAID and the Government of New Zealand, we encouraged island countries to take up offers of assistance from Australia and other donors to adopt and implement legislation on counter-terrorism and transnational crime. We provided direct assistance to facilitate island countries' compliance with international counter-proliferation obligations.

Iraq

Australian support for Iraq's political transition, internal security and rehabilitation has continued to be a major Government priority. The department's Iraq Task Force remained the primary whole of government focal point for Australian Iraq policy, coordinating regular meetings of key strategic departments and agencies, and providing policy advice to ministers.

Political transition process

Australia worked closely with Coalition and Iraqi partners to support the transfer of authority to Iraqis and the 30 January 2005 elections, which gave Iraqis their first opportunity in several decades to vote in open and fair elections.

Australia's contribution to the Iraqi elections

The department continued to support Iraq's political transition process, which will include the drafting of an Iraqi constitution and the conduct of elections for a permanent government. We participated in the joint EU/US Conference in Brussels on 22 June 2005 to highlight Australia's commitment to Iraq's political transition process, economic recovery and implementation of the rule of law.

Developing links with decision-makers and opinion-leaders

The department played a key role in managing Australia's relationship with core alliance partners (United States, United Kingdom) on Iraq issues, and helped expand strategic ties with Japan following the deployment of Australia's Al-Muthanna Task Group to southern Iraq to provide security and support for Japan's Iraq Reconstruction and Support Group. We supported ministerial and senior official visits to these countries, and managed high-level dialogue with alliance capitals on Iraq issues.

Through our embassy in Baghdad, we fostered strong links with the Iraqi Transitional Government and other leading decision-makers. We helped facilitate visits to Iraq by Defence Minister Hill in December 2004 and May 2005, building close ties with Prime Minister Dr Ibrahim Ja'afari and other senior government members. We also assisted the re-opening of the Iraqi embassy in Canberra—another step forward in the bilateral relationship.

The department coordinated Australia's engagement with the UN on Iraq issues, and in particular assisted the UN's Independent Inquiry Commission looking at the management of the UN Oil-for-Food program.

Security of Australians in Iraq

The security environment in Iraq remains extremely dangerous. The department kept the Australian public informed about the security situation through regular updates to the Iraq travel advice. We managed security issues for the Government by coordinating regular inter-departmental consultative processes and the despatch of and support for Emergency Response Teams to Iraq in response to hostage situations in September 2004 and May 2005.

The embassy faced a number of security incidents but continued to operate effectively and perform essential functions. Construction of permanent, more secure embassy facilities within Baghdad's International Zone was completed in July 2005. The department worked very closely with the embassy to support the project (see output 1.2 for more information).

Rehabilitation assistance

The department worked with AusAID, the Department of Defence and other agencies in developing and implementing Australia's Iraq rehabilitation assistance strategy. Australia has committed over $171 million to Iraq's rehabilitation and reconstruction since 2003. This figure includes $45 million allocated in the 2005 Federal Budget for further assistance in 2005–06 and 2006–07.

The department represented Australia at successful Paris Club negotiations on the forgiveness of Iraq's debt (see also sub-output 1.1.6).

The department and AusAID presented Australia's views on the reconstruction of Iraq at the October 2004 third donors' meeting of the International Reconstruction Fund Facility for Iraq (IRFFI) in Tokyo. Australia encouraged all donors to work with and support Iraq in implementing its national strategy, including through early disbursement of pledges. Donors have accepted quick disbursement as an important objective despite security and other obstacles.

Commercial opportunities

Ministers and the department worked intensively to protect Australia's wheat sales to Iraq following claims by the Iraqi Government in March 2005 that several shipments of AWB Ltd wheat were contaminated with iron filings. The claims, proved unfounded, prevented the unloading of wheat shipments in Iraq for almost three months (from early March to early June) and came at significant cost to AWB Ltd and Australian wheat farmers.

The department, working with the Baghdad embassy and AWB Ltd, coordinated a comprehensive response to resolve the dispute. The Government made over 30 representations to senior Iraqi leaders, involving the Prime Minister, Mr Anderson, Mr Vaile and Senator Hill. The impasse was resolved in AWB Ltd's favour in early June 2005.

Middle East

Photo - See caption below for description
Mr Don Randall MP and Julia Dixon, First Secretary, Australian embassy Beirut (standing at back), observe the ballot count in a polling booth in Zghorta during the fourth and final round of parliamentary elections held in northern Lebanon on 19 June 2005.
Enlarge image :: Photo gallery

The department worked to improve the architecture for Australia's economic engagement with the Middle East, particularly with Gulf Cooperation Council states.

Mr Vaile, supported by the department, chaired a successful Joint Ministerial Commission (JMC) meeting with ministers from the United Arab Emirates and senior business representatives from both countries in March 2005, resulting in the launch of negotiations for the proposed Australia–UAE free trade agreement.

Mr Vaile's visit to the UAE in April 2005 built on the positive outcomes of the JMC and reinforced Australia's commitment to expanding and enhancing our trade and commercial relationship with the Gulf more generally. The second round of FTA negotiations in June produced substantial progress across a range of issues (see sub-output 1.1.5 for more information).

Australia's growing commercial engagement with the region was further reinforced by high-level visits supported by the department and posts. These included visits by the Minister for Agriculture, Fisheries and Forestry; the Minister for Defence; the Minister for Veterans' Affairs and a number of state ministers. The department played a key role in the negotiation of memorandums of understanding on the live animal trade (see sub-output 1.1.5 for more information).

We established a new embassy in Kuwait, a key strategic and trading partner. Underlining Australia's support for democratic government, we facilitated the participation of an official Australian election observer delegation, led by Mr Phillip Baressi, MP, for the Palestinian presidential election in January 2005 and for the final round of the Lebanese parliamentary elections in June 2005, led by Mr Don Randall, MP. Relevant embassy staff participated in both observer missions. We made strong representations in favour of free and fair elections in Lebanon. The elections, held without foreign interference, were the freest in a generation.

Iran continued to engage the department's attention because of increasing concerns about its nuclear program (see sub-output 1.1.8 for more information) and Australia's important trade and other bilateral interests there.

In light of good progress recently made on the Middle East peace process, the department continued to advocate a two state solution—a viable Palestinian state standing side-by-side with a secure Israeli state—and to encourage progress on the Gaza disengagement process. We provided support for the visit of Israeli President Katsav to Australia in March 2005, which demonstrated the warmth of the bilateral relationship.

The Council for Australian–Arab Relations, for which the department provides the Secretariat, implemented a comprehensive program to strengthen and broaden relations. In March 2005 Mr Vaile launched guides to doing business with the UAE, Saudi Arabia and Qatar for small and medium exporters. Other key Council activities in 2004–05 included: visits from Saudi Arabia and Lebanon under the Business Speakers Program; placement of professionals from the UAE and Oman in Australia and professionals from Australia in Oman under the Young Professionals Exchange Program; and the continued development of a Teachers' Resource Kit (Explore Australia) for use initially in schools in the UAE, Kuwait and Qatar.

Africa

The department cooperated with other agencies and business to strengthen the bilateral relationship with South Africa, our largest trading partner in Africa and twentieth largest overall. The department hosted the first round of bilateral senior officials' talks in late 2004 in Canberra. In March 2005, our high commission in Pretoria organised visits by Mr Billson to Botswana for the Australia–Southern Africa Business Council Conference and then to South Africa for an extensive public diplomacy program and to promote Australian mining and sports business interests. We enhanced cooperation with South Africa and Mauritius to counter illegal fishing in Antarctic waters, including by encouraging South Africa to negotiate a fisheries cooperation agreement, which is nearing completion.

The department strongly pursued the Government's policy of working with like-minded countries to pressure the Zimbabwean Government to restore democratic governance and respect for human rights and the rule of law, and to reverse its disastrous management of the economy. Australia was prominent in condemning Zimbabwe's deeply flawed parliamentary elections in March 2005 and the subsequent 'Operation Restore Order', which exacerbated economic hardships in the country. In response to these developments, the Government tightened its smart sanctions (designed not to impact on the social and economic welfare of ordinary people) against Zimbabwe, but continued to provide emergency food and other humanitarian aid.

The department coordinated Australia's response to the situation in Sudan, focusing on the humanitarian crisis in Darfur. We worked with the international community to maintain pressure on the parties to the conflict and encourage passage of UN Security Council resolutions; offered logistical support for the deployment of African Union peacekeepers; worked with the Department of Defence on a contribution of Australian Defence Force specialists to the new UN Mission in Sudan; and, through AusAID, provided over $40 million in assistance to those affected since the emergence of the crisis.

The department and our missions maintained strong support for Australian business interests in Africa, particularly in the natural resources sector, including new investments in energy extraction in North and West Africa.

Elsewhere in Africa, the department advanced Australia's relations by consolidating our new high commission in Ghana and working with Austrade on the opening of a consulate-general in Libya, as a first step towards a full mission. We expanded our consular coverage in West Africa. We facilitated a modest expansion of the diplomatic and consular presence of African countries in Australia. Our high commission in Nairobi supported visits to Kenya by Mr Vaile in May 2005 for international meetings to advance our multilateral trade interests and by the Minister for Agriculture, Fisheries and Forestry to Eritrea in April–May 2005 to sign a memorandum of understanding on agricultural cooperation and live animal trade.

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