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PRIME MINISTER
EMBARGOED UNTIL 9.00 PM 15 FEBRUARY 1995
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ADDRESS BY THE PRIME MINISTER, THE HON P J KEATING MP
TO THE CHINESE CHAMBER OF COMMERCE " AUSTRALIA AND ASIA:
THE NEXT STEPS", PERTH, WEDNESDAY, 15 FEBRUARY 1995
It is a real pleasure to be at this coffee shop forum and to see so many
people here.
This is now a Perth institution. And I hope groups like it will soon be an
Australian institution. Because all of you here are participants in a great and
important enterprise the shaping of our involvement with Asia.
I have said before that this engagement with Asia is not a take-it-or-leave-it
affair for Australia. Asia is not a target of convenience for us. It is not a
fashion, or a flavour-of-the-month, or a political gimmick.
I have long believed that Australia's relationship with Asia has to lie at the
very centre of our external interests.
I am convinced that we came perilously close in the 1960s to marginalising
ourselves in the world. The White Australia Policy and the barrier of
protection and regulation behind which our industry and financial institutions
slumbered were all of a piece. Both were the product of the same defensive
and inward-looking cast of mind.
Just in time, I believe, we saw the need to open ourselves out to the world, to
break through all those protective barriers which held Australia's economy
and our minds in check.
A sea change has since taken place in the views of all sorts of Australians
and I am very glad of it.
It has been common in some quarters to hear Australia's interest in Asia
portrayed as a simple example of economic determinism: the charge,
crudely, that our policies have been foisted on us by the realities of our
markets.
Of course it is true that our economic links with Asia are vital. The
percentage of our exports going to Asia has risen from around one third in
1965 to about 63 per cent in 1993. And Asia's importance to us will continue
to grow.
But it is a profound error to see that as the whole story. For me and for this
government our interest in Asia has a much broader focus and a much wider
purpose. Success in the efforts we make in Asia will affect not just Australia's
prosperity but our security. As the Government's recent White Paper on
defence made clear, strategic partnership with regional countries will be an
increasingly important part of our security policy.
And, more than that, closer engagement with Asia is already helping to
transform Australian society: the face of our society, as anyone who has
looked around the streets of our major cities knows. But also the heart of our
society.
Asian culture and Asian values will, in a very short time I believe, begin to
work their impact on mainstream Australian culture just as earlier waves of
European migration have done.
It is not surprising that this Chamber, which is part of this whole process, has
flourished here in Perth.
On this side of the continent, more than almost anywhere else in Australia, a
strong sense exists of Asia's proximity and its relevance.
Western Australia has long provided the sinews of our great trading links with
Japan and China. Over a quarter of our exports to Japan and more than
per cent of our exports to China come from this state.
And both Japan and China have major investments here, ranging from mining
interests to food.
We should never lose sight of the importance of our traditional commodity
exports, but it is also important to keep the economic relationship moving into
new areas.
We need to continue the push into manufacturing exports, services, tourism
and investments.
But for success to come in these areas we will need to depend much more on
personal contacts, on the creation of denser networks of contact across all
areas of our society business, education, government, culture.
The role of groups like yours will be critical to this process.
Your 450 members and supporters have already formed contacts with a
whole network of Chinese Chambers of Commerce and business groups
throughout Asia.
You have taken business missions to Vietnam, Indonesia, Laos, Hong Kong
and China and have hosted incoming groups from countries in the region.
And in the long tradition of Chinese philanthropy you have also been trying to
put something back into Australian society with your Foundation to support
exchanges of junior executives in the region.
In other words, your Chamber is an outstanding example of the advantage
that cultural diversity gives Australia.
It used to be argued that the appropriate image for Australia's policies
towards newly arrived migrants was that of the melting pot, simmering away
the differences of our ethnic communities until they became part of one great
Australian soup.
But if we need a culinary metaphor for Australia's approach to migrants in our
society, a much better one is the Chinese wok, in which all the ingredients
retain their own distinct identity but become part of a harmonious and
balanced whole.
Contemporary Australia thrives on difference. It imposes few conformities
beyond the one that says the first loyalty of all Australians is to Australia and
to its fundamental democratic values including, especially, tolerance.
One of the most significant productivity reforms this country can make is to
make full use of the knowledge and energy of all our ethnic communities.
To take an example relevant to all of you in this room, the East Asia
Analytical Unit of the Department of Foreign Affairs and Trade which the
Government established to increase our store of expertise on Asia will soon
be publishing a comprehensive report on Chinese business networks in Asia.
The report will provide a compendium of information for Australian business
people to help them use these networks to do business in China.
The report points out that overseas Chinese are the largest source of
investment in China. Around 98 per cent of all foreign investment in
Guangdong province, for example, is from Chinese investors living overseas.
Clearly, one of the best ways of getting into China is by having an overseas
Chinese partner.
I know your members have been involved in the preparation of this report and
will recognise the sense of its conclusions.
Groups like yours are critical to developing commercial relationships, and
State Governments also play a complementary trade and cultural promotion
role. But in the end there are some things that only the Commonwealth
Government can do and that it must do well if Australia's national interests
are to be properly protected.
It alone can establish the environment of trust with neighbouring governments
within which business can flourish; it alone can create the structures which
will support the development of a more prosperous, more secure region.
And that task has been central to the Government's foreign policy efforts over
the past couple of years. It has been a period as busy and productive as any
Australia has experienced.
I wanted to take the opportunity this evening to reflect on how far we have
come over the past twelve months or so and to look ahead to the next stages.
Because our agenda in Asia is far from finished.
With the end of the Cold War, the structure of the international system has
changed as profoundly as at any time in modern history. Technological
developments, particularly with information and communications, have
magnified the force of that change.
And although the changes have been most immediately obvious in Europe,
with the break-up of the Soviet Union and the Eastern bloc, developments in
Asia are in some ways more remarkable. The economic growth of Asia is one
of the dominant themes of the late 20th century.
In the twenty years from 1970, East Asia's share of world GDP rose from 12
per cent to 25 per cent. It is inevitable that over time this economic shift will
bring with it strategic changes as well.
To take the most obvious examples: China's weight and influence in the
world will inevitably increase; Japan will continue to seek a political influence
more commensurate with its economic importance ( one reason we support its
permanent membership of the UN Security Council); the inevitable
reunification of Korea will change the political dynamics of Northeast Asia;
and Vietnam's membership of ASEAN will just as significantly affect
relationships in Southeast Asia.
In these circumstances, it is vital that we have in place structures which give
Australia and the region a sense of certainty, which keep countries talking
about their common concerns, which provide a framework for the containment
or management of tension.
That is why I have placed such importance on APEC, which encompasses all
the most important regional economic and trade links.
And it is why I suggested in 1992 that we should give APEC a bit of
horsepower by establishing meetings between the leaders of the APEC
economies.
President Clinton took up this idea in Seattle in 1993 and then President
Soeharto hosted a second meeting last November at which leaders of all
eighteen APEC economies were present.
That meeting at Bogor, and the visionary Declaration of Common Resolve
which it produced, has permanently changed the nature of our region. It has
cemented APEC's status as the key regional body and has ensured that we
maintain a trans-Pacific approach to the region. This avoids the danger of
the world dividing into three contending blocs in Europe, Asia and the
Americas. The central element in the Bogor declaration is a firm commitment to free
trade and investment in the region by 2010 for industrialised countries and
2020 for developing countries. This will create a dynamic and integrated
market of 2 billion people.
The leaders' meeting also decided to expand the trade and investment
facilitation program, on which a good deal of progress has already been
made. This will become increasingly important as tariffs decline and services
trade is liberalised.
Also at the regional level, we began last year the process of discussing
possible links between the ASEAN Free Trade Area and the Australia-New
Zealand Closer Economic Relations arrangement, following a suggestion
from the Thai Deputy Prime Minister, Dr Supachai, which I discussed during
my visit to Thailand in April.
In the security area, Australia has played an important role in the
establishment of the ASEAN Regional Forum which held its first Ministerial
meeting last year. The ARF engages the countries of the broader region for
the first time ever in a dialogue about security issues.
And we made similar progress in our bilateral relations with regional countries
over the past twelve months.
To take just a few examples.
With China, in addition to a steady stream of high-level Ministerial visits, we
had a visit in November from Mr Qiao Shi, the Chairman of the National
People's Congress and the third most senior member of the Communist
Party. In June, the largest ever Chinese trade and investment delegation
came to Australia.
Qiao Shi's remarks at the end of his visit that Australia-China relations have
" extremely good potential" are ones I can only endorse. China is now our 6th
largest trading partner and China has more foreign investment in Australia
than in any other country.
Both Hong Kong and Taiwan, the other two Chinese economies represented
in APEC, remain very important to Australia. Taiwan is our seventh largest
trading partner and Hong Kong our tenth largest. The Government is
committed to building our commercial relationship with both. The Australian
Commerce and Industry Office in Taipei has been expanded and last year my
colleague Michael Lee made an unofficial visit as Tourism Minister. Hong
Kong will lose none of its importance to Australia after 1997.
I visited Tokyo for the second time as Prime Minister in September last year.
Japan remains, of course, overwhelmingly Australia's largest economic
partner. I was struck by the fundamental nature of the political and economic
change Japan is undergoing. As this change progresses, Australia's broad
policy dialogue and partnership with Japan will become even more important
to both of us.
I have said before that there is no relationship more important to Australia
than that with Indonesia.
I visited Indonesia twice in 1994 and the Austral ia-I ndonesia Ministerial
Forum, which President Soeharto and I established during my first visit to
Jakarta, met for a second time.
Our purpose with the Forum has been to broaden the relationship into new
areas of activity.
And it is quite clear that this is happening. In areas like energy, defence,
education, health, trade unions, transport and communications, the
environment, science and technology even sport we have never found so
many areas for cooperation.
Our trade has trebled over the past six years to more than $ 3 billion and we
are one of the top ten investors in Indonesia. A number of West Australian
companies Clough Engineering, the John Holland Group, Heytesbury
Holdings, Environmental Solutions International are all major forces in the
Indonesian market.
The very successful Australia Today Indonesia ' 94 promotion, at which 200
Australian companies and the West Australian Government were
represented, was another step in broadening the relationship.
We were also very glad to receive Vice President Try Sutrisno in Australia
last September, the most senior Indonesian to visit Australia since President
Soeharto in 1975.
Our burgeoning relationship with the Republic of Korea reached a new high
point with President Kim Young Sam's visit to Australia last November.
Korea has just passed the United States to become Australia's secondlargest
export market.
President Kim and I have been determined to find ways of consolidating and
broadening this relationship.
Among the outcomes of his visit were an agreement to establish a joint fund
to support technology projects in areas such as the information superhighway
and clean energy.
We also agreed to upgrade science and technology cooperation and to hold
a Ministerial-level symposium to look at long-term energy issues, one of the
issues at the core of our relationship. We are also committed to building up
people-to-people contact between Korea and Australia.
The relationship with Singapore also made rapid progress last year. Prime
Minister Goh visited Australia in September and I was able to meet him again
at the APEC summit in Jakarta.
We established during his visit here a high level Singapore-Australia
Business Alliance Forum to assist business and investment in both countries
and also in third markets.
And both governments have put money into a fund to support feasibility
studies for joint participation by our companies in third markets.
Prime Minister Goh and I agreed to look at ways of further encouraging
Singaporean investment in tourism especially ( and I was very pleased to
support this) in providing opportunities for young Singaporeans to come to
Australia. Already the number of nights spent by Singaporean visitors in
Western Australia grew by 33 per cent in 1993-94.
Links between Australia and Malaysia are also growing. Our two-way trade
increased by 26 percent in 1993-94 to reach almost $ 3 billion. And our
exports have been growing by an average of 17 per cent over each of the
past five years.
One of the particular strengths of our relationship has always been in
education. More than 100,000 Malaysians have been educated here no
doubt some of them are in this room tonight and this provides a broad base
of understanding and goodwill which is unique in our regional relationships.
Malaysian companies, including the Malaysian Mining Corporation, are active
players in the Western Australian economy.
And local companies such as SBF Shipbuilders, John Holland and high-tech
companies like Working Systems, are performing well in the Malaysian
market. I had a couple of useful meetings with Prime Minister Mahathir at the APEC
meeting last November. Each of us saw considerable potential for further co-
operation between Australia and Malaysia, particularly in areas like the
environment and in scientific and technological research. I would like to see
some practical steps forward on this during the year.
Our relationships with Thailand, Laos and Vietnam also offer substantial
opportunities to Australia. I visited all three countries in April 1994 and have
since had further discussions with Prime Minister Chuan, when we met again
at the APEC meeting in Jakarta. And I was glad to be able to talk to
Vietnamese Foreign Minister Cam during his visit to Australia last week.
We have now opened a new Consulate in Ho Chi Minh City which will help
expand the commercial and consular services we can offer Australians there.
So we have been making very good progress on all these fronts. But the task
does not end. This year's agenda is equally heavy.
In the APEC forum, the challenge this year is to put real flesh on the
commitments entered into at Bogor.
We have already set the end point for APEC trade and investment
liberalisation comprehensive free and open trade in goods, services and
capital. So, unlike the lengthy trade negotiations in the Uruguay Round, we
will not be haggling about the extent to which we will reduce barriers.
What we will be addressing at our Osaka meeting and what we expect to
come out of the meeting is a comprehensive action agenda for getting to
free trade and investment
This action agenda will set out the key principles to guide APEC trade
liberalisation and put up some signposts along the way to 201 0/ 2020
No one pretends this will be easy. But I am confident that the hard
commitments we made in Bogor will be translated into action.
Japan, as this year's APEC chair, will have a key role in this task and officials
have begun a whole series of preparatory meetings.
Australia is ready to assist Japan in whatever way we can over the next 12
months.
At Osaka, we want to be able to announce some commercial ly-relevant
results on issues of concern to business such as standards harmonisation
and conformance and customs simplification
Australia strongly wants APEC trade liberalisation to feed into and fuel further
global trade liberalisation
So I hope APEC leaders will spell out at Osaka how they will accelerate the
implementation of their Uruguay Round commitments so that by the time
World Trade Organisation ministers meet in Singapore, probably in late 1996,
APEC will have established a very solid trade liberalisation agenda.
And I hope that the rest of the world will enthusiastically take up the
challenge. Next month, the first informal consultations between Australia and New
Zealand and the ASEAN countries about possible links between CER and
AFTA will be held in Jakarta. Our first step will be to explore with the
ASEANs how we can promote investment links and closer business ties and
develop practical trade facilitation measures.
I also want to explore in the year ahead ways in which Australia can
consolidate our co-operation with our Southeast Asian neighbours in areas
like science and technological co-operation, and medical education. A great
deal is already happening in these areas, but I believe more can and should
be done to strengthen these ties and to ensure that we are drawing on the
mutual advantages we can offer each other. I will be working on some
specific proposals.
Bilaterally, we have a heavy agenda of follow-up work with individual
countries. I will be meeting Prime Minister Goh Chok Tong again in Singapore on
March for a further round of discussions about regional developments and to
monitor the progress we have been making with the bilateral relationship.
Our defence relations with Singapore, for example, are a first-rate example of
strategic partnership with regional countries at work. On Friday, I will visit the
Singapore Airforce Flying Training School at Pearce RAAF base, and we
have other areas of possible defence co-operation with Singapore under
discussion. This year is the fiftieth anniversary of Indonesia's independence. Australia
played a role in that process through the international support the Australian
Labor Party Government gave to the independence struggle.
The Indonesian people have much to be proud of. Over the past quarter of a
century, Indonesia's economic growth rate has averaged almost 7 per cent
per annum, and the number of Indonesians living in poverty has decreased
from over 60 per cent of the population to just 13 percent. This is expected to
fall to 6 per cent by 1999. We will want to mark this important anniversary in
an appropriate way.
China is likely to go through a leadership transition this year. When Deng
Xiaoping dies, a degree of uncertainty will no doubt enter Chinese politics.
But Australia and Australian business need to be clear that we are engaged
with China for the long haul.
Its importance will only grow. But doing business there will be an
increasingly complex task. The reforms which Deng Xiaoping unleashed
mean that the simple days in which businesspeople could deal with the
central government have gone. More and more decisions have been
devolved from the state to the private sector and from the centre to the
regions.
That is why it is important to sustain the ties we have in China. More than
100 Chinese corporations and organisations have opened representative
branch offices in Australia and the number is increasing rapidly. We need to
encourage that and the reverse process of Australian investment in China.
I want to say something about India, too. There is probably a clearer sense
here in Perth than anywhere else in the country of the potential for closer
economic links with India.
The Government is enthusiastic about building this relationship. India's
economy is growing around 6 per cent annually and our own exports have
grown by about $ 300 million in the past five years.
I was planning to visit India myself next month, but domestic developments in
India have unfortunately forced the visit's postponement.
Even so, Senator McMullan has been in India this week, leading a
trade mission with a very strong West Australian component, and Senator
Evans is also planning to visit later this year. So we will be keeping up the
momentum. For this reason, I am pleased to announce that we will be holding a major
promotion in India in the second half of 1996.
We will be putting our finest arts, scientific, technological and educational
achievements on show in order to build Australia's profile in India and
promote our trade and investment links. India's selection as the venue for
this promotion underlines the importance Australia attaches to the bilateral
relationship. More broadly, there is growing interest in exploring possible areas of cooperation
around the whole Indian Ocean rim and the Government will be
holding an important conference here in Perth in June to look further at these
options. Ladies and gentlemen,
Foreign policy can no longer be isolated from other aspects of public policy.
Australia's success internationally depends not just on skilful diplomacy but
on our having in place the right economic policies to make our country strong
and competitive, and the right social policies to ensure that we make the best
use of all our people and that our children are educated with the knowledge
and skills they need.
On all these fronts we are making significant progress.
Economically, we are the fastest growing of all major industrialised
economies and forecast to remain so throughout this year. Business
investment is expected to grow by 24 per cent in 1994-95 and the profit
share has seldom been higher.
And despite this growth, underlying inflation has remained steady at around 2
per cent.
Employment is expected to grow by 3 3/ 4 per cent in 1994-95 an increase of
300,000 jobs through the year.
This is an enormously strong foundation on which to build sustainable growth
and it makes us an increasingly attractive partner in growth for the countries
around us.
We need also to ensure that we are making the very best use of our people.
I have already spoken about the need to unleash the economic capacities of
our ethnic communities. We will be discussing this whole issue more broadly
in April when, as part of our contribution to the 50th anniversary celebrations
of the United Nations, we will be hosting in Sydney a major international
conference on Global Cultural Diversity.
We have also put in place major reforms to Australia's training system to
ensure that our work force is prepared for the new, more intensively
knowledge-based, world we are moving into.
That is why the Commonwealth Government is spending $ 68 million under
the National Languages Strategy to improve the teaching of Asian languages
in Australian schools, focussing in particular on Chinese, Indonesian,
Japanese and Korean.
The demand is already there. Between 1987 and 1991 enrolments in
Australian languages increased by 86 per cent. In 1969, 429 primary and
secondary students were studying Chinese; the figure today is more than
25,000.
All this is very good news for our children's future in Asia.
Finally, another dimension of our domestic policy which will shape our
international standing relates to our constitutional arrangements and national
symbols.
In my view, it is important that Australians are able to represent ourselves
overseas in ways that are appropriate to the twenty first century. I have no
doubt that this means moving to have an Australian as our head of state.
In its report released just last month, Western Australia's own Constitutional
Committee considered the changes needed to provide for this. It should be
no surprise that the committee confirmed that there need be no concern that
any changes would affect Western Australia's position in the federation.
I take issue with those who say that this question does not matter in our
dealings with Asia.
Of course our current constitutional arrangements do not prevent our
business people from making deals or the Government from developing
cordial and productive relations with our neighbours. And the reason we
need to make these changes is because they are important to our sense of
ourselves as a people, not because of the sense others have of us.
But it is totally wrong to imagine that the fact that we share with a number of
other countries a Head of State who resides in Europe does not have an
impact on the attitude which our Asian neighbours have about the
fundamental direction of this country.
The Singapore Straits Times, for example, wrote recently that one of the
things Australia had done right in its drive towards becoming an integral part
of the region was ' preparing the people for a constitutional break with the
British sovereign to become a republic' President Kim Young Sam of Korea
made the same point in an interview after his return from Australia.
We have, of course, many foreign policy interests outside Asia, many
relationships of substance and importance. In a globalised world, that it is as
it must be. I am looking forward, for example, to visiting Germany and the
Netherlands early next month.
But, as I have said before, the simple truth for Australia is that unless we
succeed in Asia, we succeed nowhere.
The challenges we face are great. But it is as exciting an enterprise as
anything Australia has ever been involved with. And on its outcome depends
nothing less than the future of this country as we enter the twenty first
century. Australia's Asian community will be a key to that process. But I want to
emphasise that I do not see this as the only role of that community, or the
sole preserve of that community.
What is needed, above all, is for Australians of Asian background to take
their full place in all aspects of our national life in politics, in the arts, in
St 13
entertainment and communications, in business and the professions. This
process is already well underway, but it has further to go.
Only when it is complete will we be able to say that the contribution of the
Chinese and other Asian communities to Australian life matches its enormous
potential. ends