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Transcripts from the Prime Ministers of Australia

Transcript 8489

MAJOR AGREEMENTS BETWEEN AUSTRALIA AND INDONESIA SIGNED TODAY

Photo of Keating, Paul

Keating, Paul

Period of Service: 20/12/1991 to 11/03/1996

More information about Keating, Paul on The National Archive website.

Release Date: 22/04/1992

Release Type: Media Release

Transcript ID: 8489

TEL Ap 17 4 tNo F 39/ 9.'
PRIME MINISTER
MAJOR AGREEMENTS BETWEEN AUSTRALIA AND INDONESIA SIGNED TODAY
The following is a brief description of the three major
agreements between Australia and Indonesia signed earlier
today.
The Fisheries Co-operation Agreement will help in the
management of the fishery resources, and in the conservation
of stocks which straddle the waters of both countries. The
Agreement will facilitate the exchange of information and
fisheries personnel and co-operation across a wide range of
fisheries related activities, including developments in
fishing gear, training, agriculture, surveillance, marketing
end post-harvest technology.
The Agreement will also encourage closer co-operation on
research and management of fishery resources of mutual
interest, including straddling stocks, shared stocks and
highly migratory species. it will provide a consultative
mechanisin under which issues such as illegal fishing in the
Australian fishing zone ( AFZ) and overfishing by foreign
fleets in waters adjacent to the AFZ can be discussed. The
Agreement does not itself provide for any new access to each
others' fishing zones, although it does provide a framework
for possible future access should the state of fish stocks
permit. The Double Taxation Agreement will clarify the taxing rights
of Australia and Indonesia over income flows between them. It
contains provisions for the avoidance of double taxation and
the prevention of tax evasion. The Agreement allocates taxing
rights in respect of various categories of income flowing
between Australia and Indonesia. Certain classes of income
are to be taxed only in the country of residence of the
recipient. Other classes of income may be taxed in the
country of origin, with the country of residence of the
recipient. Other classes of income may be taxed in the
country of origin, with the country or residence, If it also
taxes the Income, allowing a credit in respect of the tax paid
in the other country. In addition, the Agreement places
limitations upon the rate of tax that the country of origin
may impose on dividend, interest and royalty income and
pensions, Including government pensionB, paid to residents of
the other country.

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The Second World War brought Australians and Indonesians
into extensive contact with each other.
After the war there was widespread sympathy among
Australians for the cause of Indonesian independence.
The sympathy found concrete expression when, in the course
of the Indonesian struggle, the Australian labour movement
imposed boycotts and black bans against Dutch shipping.
In 1947 it was Australia, together with India, which brought
the matter of Indonesian independence before the UN Security
Council. Shortly after, Australia was nominated by Indonesia to sit
on the three-nation United Nations Good Offices Committee.
As one coymientator said, this display of confidence in
Australia by Indonesia was the high-water mark of relations
between our countries in the early post-war years.
Australia co-sponsored Indonesia's admission to the United
Nations in 1950.
The achievement of your independence was thus one of the
proud moments in the history of Australian diplomacy.
But of course the historical threads go well beyond the lost
fifty years.
Australia, after all, was once called New Holland.
Not many years af ter the Dutch established themselves in
Indonesia, one of their number, named Abel Tasman, sailed
from Jakarta or Batavia as it was then known along the
west and south coasts of Australia.
He left Australia, rather ungraciously remarking, " there is
no good to be done here".
And he sailed on to trade with places in the north,
including Japan.
Asia has long been a theatre for trade between dissimilar
societies, and Australia and Indonesia have long been a part
of it.
Before Europeans traded in the region, fishermen from the
Makassar area In what was then called the Celebes, were
trading with China in trepang gathered of f the northern
Australian coast.
This was Australia's first export commodity: and a valueadded
one at that for, with the cooperation and assistance
of the Australian Aboriginals, the trepang was cured and
smoked on Australian shores for export to China.

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The cultural influence of this trade can still be seen in
the language and culture of the Australian Aboriginals who
came in contact with the peoples from the Makassar area.
In the era of colonial Australia and colonial Indonesia,
Jakarta was a refuge and source of supplies for British
ships beginning with James Cook's Endeavour.
In the first half of 1790, the Infant British colony at
Sydney Cove, cut of f from home, terribly alone, and as yet
Incapable of making the new environment yield food, sent a
ship to Jakarta for supplies.
By the time it returned, British ships had arrived and the
colony was saved, but the ship from Jakarta was very welcome
nonetheless. Ladies and gentlemen, as we plan our strategic, trading and
cultural relationships in this last decade of the twentieth
century, -it is worth bearing these historical threads in
mind. Together they suggest a pattern of interdependence.
They hint at what can be done.
Today we believe a great deal can be done not merely in
response to immediate needs, but in pursuit of a worthwhile
and enduring relationship between our two countries.
In quite different ways we have both emerged from a colonial
past. We have both committed ourselves to the kind of
radical economic reform which will give our nations a secure
place in the world.
The Australian government believes that all we do In the
world, in Asia and the Pacific, all we do in Indonesia, we
will do best as a nation of independent and unambivalent
mind. We have long been Independent.
But, perhaps because we are a European country living
alongside Asia, the residues of colonialism have tended to
persist. There is a conservative element in Australian society not
so strong as It was, but influential just the same which,
through its attachment to the past and Its anxiety about the
Asia-Pacific future, tends to resist the full expression of
Australian nationhood.
it Is the same element which opposed Indonesian independence
in the 1940s.
Attitudes are often the last things to change.

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As I'm sure it affected Indonesia long after independence,
the colonial legacy still affects us. and we still face
questions about what part of it we should retain and what
parts cast off.
A great d eal of our British colonial heritage underpins our
political and legal institutions. It remains a defining
element in our culture.
We do not seek to change these things.
But our population is no longer the overwhelmingly British
one it was.
Contemporary Australia is multicultural the old
Australians of English, Scots and Irish stock having been
joined by large numbers of people from all the countries of
Europe, the Middle East, the Americas and Asia. By that
measure alone we are very much part of the world.
Multi-culturalism has done much to break down our fear of
cultural difference, and therefore our old fear of Asia.
We are substantially changed in this.
we are more worldly, more mature.
So should we be.
By most measures we are not a young country. The
Commonwealth of Australia is almost 100 years old.
Australian democracy, founded in the 1850s, is much older
than most democracies in the world.
There should be no question about our identity or where our
loyalties lie.
For far too long we have measured the strength of our
society, the level of our sophistication, the worth of our
achievements, against Britain and Europe and against the
United States.
At times we have done this while clinging to such vestiges
of the old imperial power and culture as will, we think,
earn us respect In the world.
we think the time has come to step out of the colonial
shadow and make our position clear:
* we are Australian
* we are engaged with Asia.
We are different culturally, historically, politically
but we can handle the difference.

2> Iipr
We believe we can contribute something to what is already a
diverse region. The Asia-Pacific, as well as Indonesia, canl
achieve unity in diversity.
Ladies and gentlemen, the Australian government is actively
and unequivocally comm~ itted to this region and to
developing, In particular, a relationship with Indonesia.
In significant ways we have shared the past. If we are
prepared to put in the effort, we can share a much more
substantial future.
In the forty-two years of our diplomatic relations, there
have been substantial achievements as well as periodic
setbacks. If we reflect on that experience, I think we will see that
we have made progress when we have been realistic.
We have achieved things, and been able to protect those
achievements, when we have found a tangible basis for our
work. We have been disappointed, I think, when we have failed to
take sufficient account of our different outlooks.
We are very different countries. We will always see some
things differently.
What we need for a successful bilateral relationship is the
firm ground of tangible achievements, and real incentives to
see us through the times when good will is not enough.
We need to identify our shared Interests and create the
Institutional links which will consolidate our progress.
We need to create the conditions in which new shared
interests will emerge.
To point the way towards a more secure relationship, let me
say where I think some of our most important common
interests lie.
Most obviously we share an Interest In success.
More, probably, than most Australians appreciate, our
country has benefited enormously from the success of yours
in recent years.
Our experience of nation-building has not followed the same
path as yours.
As a consequence, we are inclined sometimes to underestimate
how difficult it is to achieve orderly development in a
nation as vast as Indonesia, and as culturally, ethnically
and religiously diverse.
The achievemen~ ts of President Soeharto's New Order are very
great.

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Between 1966 and 1991, Indonesia's real GDP rose 450 per
cent. Its real growth rate over this period has been one of the
highest among developing countries.
Structural change has been rapid; agriculture's share of GDP
is half what it was a quarter century ago.
In the late l970s Indonesia was the world's largest importer
of rice. In 1984 Indonesia became self-sufficient.
The people of Indonesia are now better fed, housed and
educated than ever before. Infant mortality rates are
approximately half what they were.
These are triumphs.
But the achievements of the Soeharto Government spread wider
than this.
in establishing political stability and economic progress in
Indonesia, your government has contributed to stability and
prosperity In the wider South-East Asian region.
Australia Is among the beneficiaries.
We gain commercially, of course; but just as importantly,
our national security benefits from a benign environment
where not so many years ago there was great uncertainty and
volatility. We share with Indonesia a fundamental interest In the
strategic stability of our region, and in limiting the
potential for external powers to introduce tension or
conflict. Recognising this shared strategic interest, we are keen to
work with Indonesia as equal partners to strengthen
bilateral defence relations.
There is scope for building closer links between our armed
forces end defence organisations. We can do this with more
high-level visits and consultations, combined exercises,
training and other exchanges.
Earlier I referred to those seamen from the Makassar area
who for hundreds of years made annual calls to harvest the
trepang from the shores of Aboriginal Australia.
Plainly, for hundreds of years a common interest was
recognised and practical arrangements devised.
So now our practical interactions as neighbouring countries
create another category of shared Interests.
Our maritime border is the most obvious of these.

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Most of the sea-bed boundaries were formally delimited
twenty years ago, but there remained important areas where
agreement had not been reached.
The most extensive of these was the Timior Gap, covering
potentially rich reserves of oil and gas under the Timor
Sea. Rather then attempt to reconcile different legal
interpretations of rights ever the continental shelf, the
two governmients established a joint development zone for the
cooperative exploration and exploitation of the area's
petroleum resources.
TheTinmor Gap Zone ofCooperation Treaty, which entered into
force niVFebruary 191, ii~ triumph of creative cooperation
between our two governments. It is the most substantial
bilateral agFreent we have concluded.
It demonstrates conclusively that we can find imaginative
solutions to bilateral problems when we recognise the common
Interest and apply to it the necessary political will.
Ladies and gentlemen, earlier today three more bilateral
agreements were signed.
They deal with double taxation, extradition and fisheries
cooperation. In practical ways they each expand and strengthen the
framework to improve the bilateral Interaction between
Australia and Indonesia as outward-looking neighbours.
Ladies and gentlemen, as everyone here Is aware, the
situation In Last Timnor has been a recurring and sometimes
divisive issue in our relations.
I should take this opportunity to explain that the
disproportionate attention East Timor receives in Australia
does not mean that we are not Interested in the welfare of
the 182 million people who live in Indonesia's 26 other
provinces. The attention East Timor receives, internationally and in
Australia, is a natural consequence of the territory's
uniquely troubled history, beginning with its neglect under
Portuguese rule.
We carry no brief for the Portuguese occupation of the
territory, or for the manner of their leaving or their
recent diplomatic manoeuvres.
Australia's outlook has been shaped by the additional
factors of our proximity to East Timor, the fraternal links
we had with the people of East Timor during the Second World
War, and the sizeable East Timorese community which now
lives in Australia.

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Australia made it clear that it did not condone the manner
in which Indonesia acquired East Timor, but since 1979 we
have accepted Indonesian sovereignty over the territory.
The Australian Government has made clear its views about the
tragic events In Dili last November.
We consider the subsequent actions of the Indonesian
Government, including President Soeharto's public statements
and the measures announced by the Army Chief-of-Staff on 27
February, to constitute a credible response.
Our continuing concern Is with what practical help we might
be able to give to the people of East Timor.
Our aim as concerned outsiders is to assist where we can in
measures for their welfare, and to support a process of
reconciliation between them and the Indonesian authorities.
I am pleased that during this visit our two goverrnents have
been able to sign a memorandum covering an 11.5 million
dollar Australian Bid project to improve water supply and
sanitation in parts of East Timor.
Ladies and gentlemen, in coming to terms with a more fluid
political environment in Asia, Australia and Indonesia have
ample scope to cooperate in helping shape the regional
agenda. Indonesia's regional credentials are very clear.
It is a leading member of the Association of South-East
Asian Nations ( ASEAN), which is a focus of wider dialogue
and cooperation.
I should like to think that Australia, too, has demonstrated
an ability to contribute usefully to regional diplomacy in
recent years.
Our two countries have invested considerable effort in the
long negotiations leading up to last October's
comprehensive political settlement of the Cambodia conflict.
our armed forces are now serving in Cambodia as part of the
United Nations peace-keeping presence.
We have also worked closely together to encourage a regional
dialogue on security issues, centred on the ASEAN PMC
process. Ladies and gentlemen, I said at the beginning of this
address that it Is remarkable what can be achieved when
common interests are identified and pursued. And they will
be pursued the herder If they are material common interests.

9
It is one of the happy coincidences of the history of our
two nations that In recent years we have adopted economic
strategies which greatly multiply our common interests.
We were both overly dependent on commodities. We have both
sought to correct our external imbalances. We have both
liberalised our economies.
Since coming to office in 1983, the Australian Government
has removed exchange controls, floated the Australian dollar
and made it a more competitive currency, deregulated banking
and radically reduced import protection.
We have cut back the government sector and cut taxes. We
are now encouraging an historic shift from industry-wide
labour relations arrangements to workplace bargaining.
In the same period Indonesia has transformed its economy by
Implementing strikingly similar policies.
Banking has been deregulated and monetary policy changed so
that it now relies on interest rates instead of credit
restrictions. Indonesia has cut protection against imports, Increased
manufacturing production and reduced dependence on
commodities. You too have cut back on government spending, rationalised
taxes and created a competitive exchange rate.
Both our economies are now much more open and outward
looking. Both are more competitive and more diverse I would venture
to say, more creative.
I would also go so far as to say that what we have done has
given our countries a better chance in the modern world.
our own success might be seen In the growth of our economy
by more than one third in the past decade, in the fact that
we are exporting more, that our trade is increasingly with
our regional neighbours, and the contents of exports now
includes a significant proportion of services and
manufactures, in addition to our traditional strengths In
food, minerals and other raw materials.
Indonesia's success might be measured in those dramatic
improvements in living standards I referred to earlier, and
in average real GDP growth of about 6 per cent during the
1980s. Ladies and gentlemen, this common strategy of creating
liberal market-oriented economies produces, as I said,
common Interests.
Concrete common Interests.

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It has taken longer than it should have, but in recent years
Australia and Indonesia have discovered each other
commercially. We have discovered that we have goods and services to
exchange and investments to make.
Between 1989 and 1991 two-way trade increased by 66 per
cent, to be worth approximately 2.4 billion Australian
dollars. Australian investment in Indonesia has increased markedly.
Indonesian companies are now also starting to invest in
Australia. The trade in services is also growing in tourism,
education, medicine, and support industries for the major
mining ventures.
There are many other areas in which Australian expertise
should be able to find niches in Indonesia. Pleasing as the
trend of recent years has been, we know that we have the
potential to play a much bigger part.
We have much to offer In the way of raw materials, capital
equipment and technology.
Australia's experience in coping with similar climates,
extensive coastlines and long distances has produced
technology and solutions well-suited to Indonesia often
much better suited than the products of, say, Japan, Germany
or the United States.
Our experience and expertise in many other other areas is
second to none in the world in forest management, solar
technology, food processing and coal-fired power stations
for instance.
We can assist as exporters, but just as readily as joint
venture partners.
I'm confident that we will find the larger role we seek.
As both countries expand along this liberal economic path we
can expect the trade to grow. We can expect the range of
shared interests to grow.
We can expect, I believe, a much more productive and durable
relationship between our two countries.
Ladies and gentlemen, in recent public statements in
Australia, I have emphasised the need for us to come to
terms with the economic vitality of the Asia-Pacific region.
our external policy reflects the interest we share with you
in maintaining a sound multilateral system for international
trade.

Transcript 8489