Chapter three: A stable and prosperous Indo–Pacific

The Indo–Pacific’s rising prosperity has been built on the region’s stability. Today, the Indo–Pacific is undergoing a strategic transition as profound as the economic transformation that preceded it.

No long-term foreign policy objective is more important to Australia than ensuring our region evolves peacefully and without an erosion of the fundamental principles on which the Indo–Pacific’s prosperity and cooperative relations are based.

Australia will be active in advancing and protecting our interests at this critical time. Our interests lie both in stability and in the character of the enduring peace we seek. In particular, our security and prosperity will be enhanced in a region characterised by respect for international law and other norms, and by open markets. This will help ensure Australia can prosecute our national interests unconstrained by the exercise of coercive power. Our policies to support a stable and prosperous Indo–Pacific complement our trade, investment and economic engagement with the region, which is detailed in the next chapter.

The Government’s approach to better protecting and advancing our interests in a changing Indo–Pacific begins with substantial investments in the foundations of our national strength. In particular, we are building a more capable, agile and potent Australian Defence Force. We will also pursue active diplomacy and use our development cooperation to promote economic reform and social stability. The Government will strengthen our law and justice, border protection and intelligence capabilities.

Our alliance with the United States is central to Australia’s security and sits at the core of our strategic and defence planning. The Government will broaden and deepen our alliance cooperation and encourage the strongest possible economic and security engagement by the United States in the region.

Strengthening our Comprehensive Strategic Partnership with China is also vital for Australia both to pursue extensive bilateral interests and because of China’s growing influence on the regional and global issues of greatest consequence to our security and prosperity.

The Government will lift the ambition of our engagement with major Indo–Pacific democracies. We will do more bilaterally and work across these partnerships, including in small groups, to promote and protect a shared vision for the region and to support a balance in the region favourable to our interests. Our partnership with Japan, one of our most important regionally and globally, will remain essential to Australia’s interests. In addition to the United States, we will strengthen economic ties and other shared interests with Indonesia, India and the Republic of Korea.

As competition for influence in Southeast Asia sharpens, the Government will ensure Australia remains a leading economic, development and strategic partner for ASEAN and its members.

The Government will also continue to invest in regional institutions because they promote economic cooperation and help build norms that support the peaceful resolution of disputes.

As set out in the 2016 Defence White Paper, Australia will boost defence engagement with countries in the Indo–Pacific, including through increased training, exercises and capacity building.

Australia will also pursue regional trade and investment arrangements that increase growth and promote openness, competition and transparency, helping to defuse strategic rivalry.

Through these policy approaches the Government will act to support an Indo–Pacific region in which:

  • countries foster habits of dialogue and cooperation, and resolve disputes peacefully in accordance with international law and without the threat or use of force or coercion
  • open markets facilitate flows of goods, services, capital and ideas
  • economic integration is inclusive of and open to all the region’s economies
  • rights of freedom of navigation and overflight are upheld and the rights of small states are protected
  • the United States remains strongly engaged in the economic and security affairs of the region and continues to help shape its institutions and norms, and
  • China plays a leading role in a way that strengthens a regional order based on these principles.

Australia will also work resolutely with our partners to counter the serious threat posed by North Korea, including by greater efforts to exert economic pressure.

The policies in this chapter reflect an active approach by Australia to shaping the character of our region. The Government recognises the difficulty of this task in an era of shifting power balances and greater rivalry. In particular, the objectives set out above can only be secured if the region’s major powers—notably the United States and China—believe that their interests are also served by them.

This is not assured. In the decade ahead we expect further contestation over ideas and influence, directly affecting Australia. It is imperative that Australia prepare for the long term. Australia and our regional partners have a shared interest in seeking to build a regional economic and strategic culture that supports stability, cooperation, the rule of law and openness.