Australian perspectives on the Indo-Pacific
Victoria University of Wellington Event
Kia ora. Tēnā koutou, tēnā koutou, tēnā koutou katoa.
Thank you Brook [Barrington, CEO MFAT].
I would also like to thank Dr David Capie, Director of the Centre for Strategic Studies, and the Victoria University for hosting us here today in the beautiful Hunter Chamber.
I would also like to acknowledge members of the diplomatic corps, representatives from the Ministry of Foreign Affairs and Trade and other government agencies, academics and students.
Amongst many other distinguished alumni of this university is Fred Hollows, who completed his undergraduate degree on this campus.
No doubt what he learnt here inspired his work on avoidable blindness; work that has benefitted so many people across the region.
As you know, this university was established in 1897 at a time when across the Tasman, the colonies that were to make up the Australian Commonwealth were preparing for the birth of our modern nation.
Back then, I believe that we were still trying to tempt you into the dream of common nationhood – an Australian Federation extending out to a seventh state in New Zealand!
Despite the years, and the rivalries, we can very easily understand why the question was so passionately debated – and why the idea was so tempting.
We have our differences, but our commonalities – and our common interests – far outweigh them.
Our shared history and values have given Australia and New Zealand a special and enduring relationship – as partners in trade under the CER bilateral free trade agreement, in adventure exploring the Antarctic Territories together, or vying for the Bledisloe Cup!
In my own experience, our partnership is especially valuable when it comes to the practice of foreign affairs.
Our diplomacy in a regional context
We are not among the great powers, and nor are we insignificant players – and this is reflected in the very foundations of our respective foreign policies.
One could argue, and I do, that our diplomacy is all the more important today, when we both find ourselves in the midst of changing global power dynamics that are – for the first time in modern history – anchored in the Indo-Pacific region.
These shifts are fluid for reasons beyond our control, and so we must do what we can to influence them in favour of our national and regional interests.
In both Canberra and here in Wellington, there can be a tendency sometimes to underestimate our power, our weight, the effectiveness of our diplomacy.
My message today is that a nation can have a tight foreign policy focus, befitting its size, and still have a major, outsized impact on its international environment.
Our strategies can and should both concentrate our efforts, and leverage them for wider ends.
We have already shown that it can be done – Australia and New Zealand have been successful in building linkages across the region to maximise security and prosperity in Asia and the Pacific.
In 1989, for example, Australia's Prime Minister Bob Hawke first stood up the idea of a forum for Asia-Pacific Economic Cooperation – "APEC."
Since then, APEC has almost doubled in its membership, and now represents over half of global GDP.1
To take another example, in the early 2000s, the Prime Minister of New Zealand Helen Clark led her government through multiple rounds of trade negotiations with what was known as the "P4" – New Zealand, Singapore, Chile and Brunei Darussalam.
Four economies focused on increased trade liberalisation, and working towards more open and more prosperous economic partnerships.
Piece by piece, the vision of the P4 negotiations gained momentum – propelled forward, most notably, when former President Obama adopted them into the US's own trade agenda.
By 2010, those negotiations had attracted so much interest that the world had started calling them the Trans-Pacific Partnership.
After countless rounds and some serious setbacks, it was still New Zealand's leadership, together with Australia and Japan, that brought these negotiations over the line.
In March this year, New Zealand, Australia and nine other Pacific Rim economies signed the Comprehensive and Progressive Trans-Pacific Partnership – the CPTPP – a free trade agreement of unprecedented ambition.
The CPTPP represents over US$10 trillion in GDP,2 and offers the potential for better income and better living standards for hundreds of millions of people.
You'd have to count that as a pretty impressive effort New Zealand!
The CPTPP is an open platform, and Australia sees it as a step towards a wider free trade area.
By setting the standard in international trade liberalisation, it offers a reference point for the future of trade policy, not just in our region, but globally – a vision anchored in the foundations of the universal WTO system.
Our two countries are working to extend the trade architecture westwards as well, to include India.
The Regional Comprehensive Economic Partnership, or "RCEP", negotiations – which include the 10 Southeast Asian nations of ASEAN, as well as China, Japan, Korea, India and ourselves – is an important piece in this picture.
In fact, I understand the next round of negotiations will be held in Auckland.
RCEP, once concluded, will create the world's largest free trade area; nearly one third of the world economy.3
16 countries, representing a great diversity of language, ethnicity, systems of government, able to come together under the umbrella of our shared geography with common goals for open, rules-based economic integration.
It is a strong message that we, the Indo-Pacific, are sending to the world and it is absolutely right that Australia and New Zealand are sending that message together and, in the process, amplifying it.
Australia's narrative of a changing Indo-Pacific
Of course it's not just about trade. As is the case in New Zealand, our region is a central focus of Australia's broader foreign policy agenda.
Whether we refer to the Asia-Pacific or the Indo-Pacific, we both understand that our security and our prosperity depend on maintaining an open, inclusive and stable region.
We are outspoken on the need to ensure our region supports rules-based international order, and demonstrates the benefits of a liberalised trading system, particularly in the face of growing protectionism.
Other nations, such as the US, Japan and India, are also talking and thinking about foreign policy to shape an open and stable Indo-Pacific as it undergoes rapid change – economic, demographic and technological.
That change is producing an increasingly complex economic and political environment; in many ways the root source of broader global transformation.
And with economic dynamism comes strategic dynamism – the Indo-Pacific is the region where the great powers will largely determine the way that the international order evolves.
In this, Australia and New Zealand can make a real difference, as we play our parts in APEC and the CPTPP have demonstrated.
There are many kinds of influence we can exert, or fail to exert, that could, through their wider, sometimes unforeseeable consequences, have significant impact on us, and on our own domestic environments, for the years ahead.
With this in mind, we in Australia are aligning our resources to support our major goals in the Indo-Pacific.
To choose the right goals, we have to understand what is happening in the region.
There are three propositions that I'd like to put to you today which define our foreign policy context.
Number one: we are in the midst of major strategic realignment in the Indo-Pacific.
This is not a matter of future possibility – it is happening right now, as we speak, as we read in our news media each morning.
Number two: we do not know how that realignment will play out.
While in some respects competition has been intensifying, there are nonetheless viable avenues for a stable balance between competition and cooperation.
Number three: we, Australia and New Zealand together, are in a position to help achieve this balance.
We will have to be agile, and forward-thinking, to make the most of the opportunities we have for influence.
It is in our interests to work closely together, and to make sure that we succeed in building an environment that is constructive to economic progress and political stability, for Indo-Pacific nations large and small.
Strategy and ambitions to support the region
These are core ideas teased out in the Australian Government's Foreign Policy White Paper, released almost a year ago now.
We grappled then with the scale and the pace of the change we are seeing today – and we are still grappling with them, even as they appear to be accelerating.
Debate and discussion between partner governments and debate and discussion among the public is crucial to ensuring that our ongoing policy reviews remain agile and sharply relevant to the region as it evolves.
At the core of it, Australia seeks an Indo-Pacific that is stable and prosperous.
We support a region:
- where countries engage in dialogue and resolve disputes peacefully in accordance with international law
- where open markets and economic integration allow societies to benefit from trade, and the growth of jobs, income and skills through investment
- where major global powers remain engaged and play a constructive and consistent leadership role in strengthening regional institutions and norms.
It is a first-order priority for us to ensure that the geostrategic changes that are underway do not disrupt the stability that underpins our region's growing prosperity.
In particular, the emerging role that China forges for itself will be pivotal to the future of the region.
It is in our interests, and the interests of our region, that China fulfils its potential as a force for stability and prosperity and global problem-solving.
Australia also encourages strong US economic engagement in the region, and we remain steadfastly committed to the US security presence, an important stabilising influence.
Meanwhile, India remains the world's largest democracy and is now the world's fastest growing major economy4 – the scale of its transformation nothing short of extraordinary.
As India reckons with its own increasing strategic weight, Australia is seeking to ensure that our immediate economic relationship aligns with our deeper, longer-term interest in the role that India will surely play.
Recognising this, the Australian Government commissioned the India Economic Strategy, authored by my predecessor Peter Varghese. It's a demonstration of our commitment to focus on India as a priority economic partner, and to build a deeper cultural literacy across business and the community.
Australia is likewise committed to a deeper engagement with the nations of Southeast Asia, and with ASEAN, the collective voice of Southeast Asia and the geographic heartland of the Indo-Pacific – central to regional economic integration and cohesion, and a contributor to the maintenance of our rules-based order.
That is why Australia hosted the ASEAN-Australia Special Summit in Sydney earlier this year – a historic event that has deepened our cooperation for security and prosperity, and has strengthened the links between our people.
Partnership with New Zealand
Closer to home, in the South Pacific, we find ourselves on well-trodden ground for Trans Tasman partnership and coordination.
We understand that resilience, stability, and prosperity in the Pacific islands is a necessary element for the success of the broader Indo-Pacific – they go hand in hand.
We and the Pacific island countries share challenges, but we are addressing them as part of a shared agenda for regional opportunity and ambition – targeting priorities named by Pacific islands leaders themselves.
At last month's Pacific Islands Forum, New Zealand's Prime Minister and Australia's Foreign Minister were among the Pacific leaders who signed the Boe Declaration.
This is a set of principles and of practical measures to ensure that we are all working together towards our common goal of security for the region – pooling resources, collaborating between governments, sharing information.
Australia and New Zealand will play an important role in the months ahead, as we implement the Declaration through structured training, intelligence sharing, and capability acquisition.
The Boe Declaration also highlights climate change as the number one core threat for Pacific Island countries.
Our two countries are working to address this challenge.
I recognise New Zealand's announcement of NZ$300 million over four years to tackle climate change, with a focus on Pacific Island countries.
In 2016, Australia likewise announced AU$300 million of our own over four years to combat climate issues in the Pacific.
I am pleased to say we have already spent $200 million of that amount over the last two years, building resilience in the face of climate change and natural disaster.
The Boe Declaration is a significant step forward – however, in many ways it also represents continuity.
New Zealand and Australia have always invested in the Pacific islands, and we have always trusted each other to make sure that our region is supported whenever that support is needed.
To take the stark example of humanitarian assistance, our joint deployments following Tropical Cyclones Winston in Fiji and Gita in Tonga were vital in supporting national response efforts.
At a time when the risk of devastation by natural disaster in our region has increased, we look to you as our closest partners.
We recognise, for instance, the New Zealand government's decision to acquire P-8A Poseidon maritime patrol aircraft – and the value that that decision will bring to our joint efforts in the years to come.
We have both also announced major new policy initiatives over the past twelve months – New Zealand's Pacific 'reset' and Australia's Pacific 'step up' – which for each of us represents our largest ever aid investment in the Pacific.
Equally, we celebrate our region's strengths and achievements – we look forward, for example, to Papua New Guinea welcoming world leaders next month as host of the 2018 APEC Leaders' Meeting.
The Pacific Islands are indeed enjoying increased global interest.
Traditionally, we have worked well alongside the US, Japan, the EU – particularly France and now, increasingly, the United Kingdom.
China too has a long history in the Pacific, and its partnerships are evolving and deepening with increased engagement.
We want all countries engaging in the Pacific to bring capital and skills and opportunity in ways that strengthen the sovereignty of individual Pacific island countries, and the autonomy of the region as a whole.
That engagement can take any number of forms – for example, investing in high quality infrastructure which we recognise is important to maintain growth and prosperity, both in the Pacific and in Asia more broadly.
Australia is currently preparing a major new infrastructure partnership with the United States and Japan, to facilitate private sector involvement in infrastructure projects that are transparent, non-discriminatory and free from the burden of unsustainable debt.
Indeed, cooperation is part of a mutual effort to defend, renew, and establish international norms with wider significance.
We seek your help to strengthen this regional architecture – as partners, amongst other partners, shaping an evolving international order.
The value that the Australian Government places on New Zealand as a partner in supporting such norms cannot be overstated – that's true of our immediate neighbourhood, and that's true of the broader Indo-Pacific.
For example, we share a common agenda for human rights; a global issue with an important Indo-Pacific dimension.
We look to our partnership when advocating globally on human rights issues such as the death penalty, gender-based rights or ethnic violence.
These are important issues for Australia and for New Zealand, and they are important issues for long-term stability and prosperity in the Indo-Pacific.
It is hard to think of another two partners working as closely in so many respects, as our two countries do.
In the spirit of that partnership, I am committed to ensuring that the Department of Foreign Affairs and Trade works closely with the Ministry of Foreign Affairs and Trade in seeking to understand and respond to the challenges we face today and that we will face in the future.
A question of sharing information, sharing insights, sharing perspectives to lead our nations' wider collaboration and to shape our international environment – something I've been pleased to do with Dr Barrington yesterday and today and indeed on many occasions over the past two years.
Australia and New Zealand share the core principles that define our national identities and determine our foreign engagement – respect for civil liberties, open economies, stable governance.
In the past, we have shown the world that together and independently, we can build from these principles to influence our region so that it is integrated, inclusive and open to the world.
We have laid some important groundwork – but as the Indo-Pacific transforms itself around us, the test is now whether we can build on it; whether we can realise an even more ambitious shared vision for our region.