GOLDSMITH:
Mr Howard, your first stop is going to be in California where you're going to be meeting the Governor to lobby for BHP Billiton's proposed development, an offshore LNG terminal. What are you hoping to secure from this meeting?
PRIME MINISTER:
Well I want to put the case for BHP Billiton. There are four of them, I understand, that are bidding for this contract, and a decision is likely by the end of the year. I'll be promoting the benefits of BHP Billiton and the great reliability of supply from Australia. There is a tremendous potential in an energy partnership between Australia and the United States, particularly the west coast of the United States, which is badly in need of energy. We have lots of natural gas, we are a very reliable supplier, and the costs now of carrying it long distance are very competitive, so I will be hoping to argue very strongly that Australia is the best place from which to source the supply, and of course BHP Billiton is the company.
GOLDSMITH:
We had some officials from the resource department this morning told a Senate Estimates committee that they had been told by US authorities that Australia is a preferred supplier for the US. Is that true?
PRIME MINISTER:
Well I don't want to count any chickens before they're hatched on this. I think it will be quite difficult to win this contract. Australia is looked upon favourably because we have a lot of natural gas, we have a very efficient transportation system, and Australia is a very stable country, both politically and economically. And you always like to deal with a stable supplier because it's reliable and predictable.
SMITH:
Prime Minister, after California you move to Washington to talk to Alan Greenspan about presumably higher oil prices. What's your take on the international economy at the moment and how do you see that helping Australia in terms of exports going forward?
PRIME MINISTER:
My take on the international economy at the moment is that apart from the cloud represented by high oil prices, it's pretty good. The American economy is picking up; the Japanese economy is strengthening; although China is going to impose some constraints, it's still growing very strongly; and Korea is doing well. Overall, the world economy is quite good, although it's uneven in Europe, but there are many parts of the Asian Pacific region that are doing extremely well. But obviously oil prices are a big worry. Nevertheless, the oil dependency of the world is a lot less than what it is... what it was at the time of the first oil shock. And the real price of oil at the present time is nowhere near as high as it was when oil prices went through the roof in the early 70s and then later on towards the end of the 70s.
SMITH:
On the domestic economy, there is a whole raft of economic data this week and the Central Bank met today to decide on interest rates. On the domestic economy, where do you see oil prices impacting here? And do you think the Central Bank at this stage is right to hold rate policy where it is? It looks like... I mean everyone expects...
PRIME MINISTER:
Well I can't speculate about what the Bank may do overnight. It seems to me though that what they're saying about monetary policy makes a lot of sense. The housing market has cooled down and that is a good thing. It's probably been needlessly hurt by some state government tax decisions which are quite bad for the housing industry and will result in investment shifting to elsewhere in Australia. Overall I think the Australian economy is very well poised. The drought is still around. It still lingers in many parts of the country. But growth prospects remain very good, unemployment is at a 25 year or 23 year low, inflation is very low, we have inflation rate well within the Reserve Bank's band, so overall I'm still pretty optimistic. A prolonged period of high oil prices obviously will have some effect, but we're rather optimistic that it won't be prolonged, although it will be around for a while.
GOLDSMITH:
In Washington, Prime Minister, you'll also be meeting with your close ally President Bush, discussing the situation in Iraq. Do you think the negative publicity coming out of Iraq, the photographs we've seen with the US troops abusing Iraqi prisoners, is that going to damage the US Administration, do you think, or your own Government in an election year?
PRIME MINISTER:
Well that's a matter for the public in each of the two countries. The abuses and obviously the photographs of them are a setback, a real negative, and it's unacceptable behaviour. The good news is that the Americans are acting quickly to bring the people responsible to trial and to punish them, and that is how it should be because that conduct is not representative of the American military. And there were no Australians involved of course, and it certainly wouldn't be something that we would support or condone in any way. We have to look at the good things that are coming out of Iraq, despite all the negatives - the massive improvement in public health, the thousands of schools that have been reopened, the reduction in the rate of inflation, the increase in the GDP, the way in which municipal government has begun to function, and very importantly the moves towards a transfer of sovereignty at the end of this month. Now all of those things are stacking up on the positive side.
GOLDSMITH:
You mentioned there has been a setback though both for Australia and for the US, and for Britain as well - all the coalition partners. Will this be something you'll discuss with President Bush, do you think, when you see him this week?
PRIME MINISTER:
Well it will obviously be touched upon, but we're not going to allow ourselves to be preoccupied with the negatives, because there are a lot of positives. And it's crucial that those who are trying to prevent Iraq becoming a democratic country do not succeed, and the aim of the terrorists in Iraq at the present time is to stop democracy coming forward, and our goal must be to defeat that objective.
GOLDSMITH:
A few days after that you'll be in Normandy where there will be all sorts of world leaders who are going to be there. Will you use that opportunity to try and perhaps lobby a little bit for the Iraq cause and get more of a positive spin perhaps on what is going on?
PRIME MINISTER:
I will take every opportunity I can to do that. Whatever people's views may have been 14 or 15 months ago when the coalition came together, we've moved on from that and we now have to focus on rebuilding Iraq, and the more countries that can be involved, the better. The greater involvement of the United Nations, the better. The greater involvement of countries like France and Germany and Russia, the better. So it is an opportunity for everybody to focus on where we agree. And we do agree about denying the terrorists, we do agree about giving Iraq a democratic future, we do agree about improving the conditions for the ordinary people of Iraq. And everybody has an interest in looking to the future on that subject.
GOLDSMITH:
On your request to the United States, hasn't that sped up its handling of the two cases of the Australians being held at Guantanamo Bay? What charges are going to be laid against David Hicks this week?
PRIME MINISTER:
Well I'm not sure of all the details, but they will obviously relate to the claims that have been made about his association with Al Qaeda. I'm pleased that the thing is now coming to a head. There seems to be this strange notion in some quarters in Australia that if an Australian is charged with committing a crime in another country, he or she has an automatic right to come back to Australia to be tried. That's nonsense. If an American or an Englishman commits a murder in Australia, they don't have a right to go back to America or England to be tried. They get tried here. It's a very strange notion that seems to have been forgotten in all this debate. And quite apart from anything else, if they were brought back here, there wouldn't be any offences against Australian law for which they could be prosecuted. So it seems a very odd argument that they should be brought back to Australia.
GOLDSMITH:
And there has been reports that he's going to be charged with a terrorist offence of conspiracy. Is that right?
PRIME MINISTER:
Well I don't want to speculate. I don't think it's right because there are legal implications possibly about anything which I might say. I mean that is a matter between the people in charge of the prosecution and his lawyers, and I have to be careful I don't say anything that might be dragged into the adjudication of the case and have an adverse effect, because these things can sometimes occur. I have been pushing very hard for the Americans to bring on the trial, and we appear to be making some progress on that front. But as to the conduct of it and what the charges are, that is not a matter for me. That is a matter for the prosecution and for the defence, and I'm not going to offer a view.
GOLDSMITH:
Have you been given any assurances about Mamdouh Habib, what's going to be happening with him now?
PRIME MINISTER:
The latest advice I have is that he will be recommended for military commission eligibility, I know that's a quaint way of putting it, within a very short period of time, perhaps this week. But I'll know more about that when I get to Washington.
GOLDSMITH:
What about the claims... I think you've asked the US to investigate these reports that have been emerging that they might have been mistreated in detention. Do you think there is any truth behind those at all?
PRIME MINISTER:
Well I don't know. I've been told by the Defence Department in the United States that there has been no abuse in Guantanamo Bay. I've gone back to them and we've asked for a formal investigation. It's fair to say that when he was visited, when both of them were visited in Guantanamo Bay, certainly in the case of Hicks, there were no complaints. In fact Hicks' lawyer said that the guards there had treated him very well.
GOLDSMITH:
In Britain you're going to be holding talks with Prime Minister Blair on Iraq, but also on Commonwealth issues. What's your view now on Zimbabwe's suspension from the grouping, and are you confident that Pakistan will be readmitted?
PRIME MINISTER:
Well I hope that Pakistan is readmitted. Australia will strongly support Pakistan's readmission. Pakistan has gone through the hoops, elections have been conducted, arrangements have been made for splitting the role of head of state and head of the armed forces. General Musharraf has given certain indications in relation to that, and I respect very much the strong stand that General Musharraf has taken against terrorism and the courage that he has displayed in relation to that. As far as Zimbabwe is concerned, it seems to me as far away as ever that Zimbabwe could be readmitted to the Commonwealth. There is no indication to me that the circumstances that caused the suspension have altered.
GOLDSMITH:
Final question, because I know you're very pushed on time. There's a lot of speculation of course about the election date, when it's going to be this year, and I have to ask you - have you now ruled out an election in August?
PRIME MINISTER:
I haven't ruled anything in or out.
GOLDSMITH:
And on yourself serving, making any commitment to serving...
PRIME MINISTER:
Well my position on that is that I will remain the leader of my party for so long as my party wants me to do and it's in the party's best interests that I should.
GOLDSMITH:
And the Newspoll today? Obviously there was a nice bounce for the Government. Do you take these things seriously, or is it...
PRIME MINISTER:
I take polls... a poll like that that registers an enormous turnaround, with a grain of salt. Obviously you prefer good polls to bad polls, but public opinion doesn't shift that dramatically. But it may be that the previous poll was wrong, so who knows.
GOLDSMITH:
Thank you very much indeed for your time.
PRIME MINISTER:
Thank you.
[ends]