PM Transcripts

Transcripts from the Prime Ministers of Australia

Transcript 2419


Photo of McMahon, William

McMahon, William

Period of Service: 10/03/1971 to 05/12/1972

More information about McMahon, William on The National Archive website.

Release Date: 13/05/1971

Release Type: Speech

Transcript ID: 2419

Tonight I hope you will permit me to speak about where
we are going and what Initiatives we are taking in novel areas of
international affairs that up until a few years ago we had riot been
concerned with. By that I mean our diplomatic international
relationships with Japan and the emerging world powers immediately
to the North. That is with the two Communist countries Soviet
Russia and the People's Republic of China that is Mainland China?
I do this because in each case I want to speak to you
about the dates on which the initiatives were first taken beginning
in April 1970. Before I get into the body of my speech I want too
purely for the purposes of identifying the dates to mention the
dates on which subsequent initiatives were taken.
In May 1970, we were looking at papers, position
papers and documents that were subsequently presented to the
Ministry, relating to a new approach to Japan. In March of this
year, we considered papers relating to China, that is, the
People's Republic of China Mainland China. Every single phrase
that has been used lately, and that I will use tonight, have beer.
taken out of those basic documents.
And finally, we had in April of this year a paper
relating to our relationships with the U. S. S. R.
I mention these dates purely to point out to you that the
Department of Foreign Affairs has been doing this work and that
we haven't, as it~ were, been forced by ping pong diplomacy to take
the kind of action recently taken.
I had the great pleasure in every one of these cases to
initiate the yolicies that I will mention to you.
If anything is to be gained or, behalf of the Commonwealth
Government, I car. assure you that each and every one of the
proposals has received the full endorsement of Cabinet, and of the
Ministry. Whilst I am going to speak about, Japan, the U. S. S. R.
and the People's Republic, I don't want you to think that I am
forgetting our great permanent and powerful friends in the United
States, and in the Uniited Kingdom.

The United Kingdom is still using its benign influence
for good in South-East Asi!, and has joined with us in the post
Anglo-Malaysian defence agreements. And the United States,
of course, has been the most powerful influence for good and
for the salvation of the free world since World Wat 11. And it will
still be expected to play this role.
Tonight, I want to speak to you about both our bilateral
and multilateral relationships with the countries I have mentioned.
By bilateral I mean our direct relationships,
diplomatic and other relationships between two countries without the
intervention of thi-rd And by " n ,... ti-lateral" relationships,
I mean those relarionshi=~ between oursel'es and a dozen and one
other countries as, for exa le, in the Un'ited Nations and the
Asian Development Bank anr. similar types of institutions. Over and
over again, you will hear me use the wo.: ds bilateral and
" multilateral" and I make his very brie explanation so that you
won't be kept in the dark about exactly what I mean.
Now I want you, too, to understand that we are a great
trading nation. We are, per head of po:,-' ation, as great as any other
country. But we also have to remember that besides the interest we
have in trade, we have other international relationships as well. We
want to achieve poe-tical s-. ltbility in the area in which we live, to help
others in the ecoc-mic de. rel. opmen: t of thi. r countries and the overriding
objective we have in international affairs that ie to play our
part to the maximum of oUl. capacity to ensure that the people of
the future the young chil'e-n of today and those who will come after
us will have a better opprranity to live under more peaceful conditions
than you and I have beer, able to live ir..
So this, then, is the basis on which I want to speak to you
tonight. May I then turnto Japai. the paper that was presented
in May of last year.
Japan is one of our great trading partners. h fact, in
terms of total trade, it is ahe greatest tr-. ading partner we have. Our
exports to Japan top the liht. She is by far and away the greatest
importer of what we produce. In terms of imports, she runs third
only to the United States, and in terms of total trade she is second
only to the United States.
It was for this reason, more than for any other, that I
started the discussions ir; the Department of External Affairs, ea'rly im May
.1973. I the: n established with the approval of -the then Prime Minister,
r. G3orton, the strongest inter--de'artmental Committee that we could
establish in order-to con sictently look at our policies and to ask ourselves
Can we improve themn' Can we improve them for the. benefit of our own people?

This worked very well, . and you people will kn~ ow that
we have i-ow established rnot only trade, but in other kinds of
relationships, the most close relationships with Japan.
What then of the future?
Let me mention that in teni years' time, Japaii will be
unmistakeably the second most powerful productive country in the
world. And because our two economics are complementary and there
is an enormous degree of complemerntarity between the kinds of
goods they want and we are able to sell to them, arid the kinds of
goods they have and are able to sell to us, that our future trade
relationships with Japan offer enormous opportunities for us.
It is axiomatic that the greater your trade, and the greater the
amount of foreign exchange you can earn, then the greater the
prospects you have got for productivity increases arid also for better
standards of living of our own people.
So we have this complementarity, and as I have said,
as Japan grows, then it is axiomatic that we will grow too.
I also want to mention other factors associated with
this period as Minister for Foreign Affairs. Japan started to change
its low posture to an exercise of a kind of global influence that a
country of its power should start to exercise. At the Djakarta
conferences, Japan for the first time took an initiative in order to
help to try and achieve peace in Cambodia along the lines of the
Geneva Conventions an-d Protocol of 1954.
I believe that Japan is moving definitely, precisely, calmly,
but still with a low posture, to play its part in trying to achievepolitical
stability in South East Asia.
But it is not of Japan that I wanted to speak to you tonight.
It is rather of the U. S. S. R. and of the People's Republic of China and
of China I want to speak at considerable length.
When I speak of these two countries, I want to remind you
of certain assumptions and of certain principles that flow from them.
The first one is that we must recognise that both of these
countries have different political and social systems to ours. Both
of them base their foreign relations on different basic ideologies.
Theirs is a philosophy of centralised government, of a political
system that depends on the Party as the dominant element in
potlcal life the Dictatorship of the Proletariat. They concentrate
on the Party itself. It is the political organisation which determines
not only their internal but their external relationships as well.

We, on the other hand, believe in representative
government, We believe that it is the people who are sovereign,
it is they who support a Party, and through the Party determine
who will represent the people in the National Parliament itself.
I want you to understand that whenever we are thinking
of trade between a communist country and ourselves, we must
remember the differences particularly that we have a free press and
freedom of expression, while theirs is controlled and their people
know little or nothing about what the real objectives of the
government might be.
This is tremendously important under present
circumstances, because if I can use Rob Askin's phrase of ping
pong diplomacy, let us remember that we are not going to gain a
great deal out of ping pong diplomacy.
We have to look much further and ask ourselves when we are
engaged in dealings with them What are we likely to gain out of it
in the long term, in the medium term and in the short term as well?
And on every occasion when we are making a decision,
we must, as all businessmen must, prepare a profit and loss account.
Ar. d we must always, when we are adding up the sums, ask
ourselves the single question. When we look at the total final figures
are we sure that they will be in the black and to the advantage of this
country. Having said that, I mertion two other principles associated
with it. I want you to realise that when we are dealing in either
bilateral of multilateral relations with other countries that we must
not think that because they have different political systems to ours
that that fact alone should prevent us from entering into negotiations
with them. That is far from the truth. The mere fact that they happen
to be socialist or communist is not in itself sufficient reason
to prevent us from entering into negotiations with them.
And the second principle that I want you to realise is that
even though you recognise international law, that
recognition does not mean that you approve of the policies of the
government recognised. It merely means that you look at the facts
of life objectively, pragmatically, coolly and calmly and thin ask yourself
the simple question if we take a certain course of action, what
advantage has it for the Australian people and the Australian nation?

This brings me to the text country I want to speak about
at this dinner tonight Soviet Russia.
I don't have to draw distinctions in this case between
multilateral and bilateral negotiations because they are in fact a
member of the United Nations and they have diplomatic relations
with us. They have their Ambassador and Embassy here. We have
our Ambassador and Embassy in Moscow. So I don't want to
speak to youabout that. What I wa-t to speak to you about is this:
The Soviet, has in recent months, been saying they would
like better relationships with us. They have been asking us if we would
give some earnest of our willingness and of our ability to improve our
relationships. To indicate to them in reply * hat we would like. They
would like to be. able to ensLure that they had bdtjter trade opportunities
with us too. In recent weeks we have been able as a government to show
the Government of the U. S. S. R. that we were prepared to make certain
concessions to them as an earnest of our intention. We have decided
and we have communicated this to the Soviet Government the
concessions we are willing to make. We will be delivering an aide
memoire setting out the details. The terms and conditions under which
the concessions will be made will be communicated to them in the next
few days. We have agreed at their request, that we will permit the Soviet
to establish a trade office in New South Wales I mention this
specifically Mr. Askin, not because i am a Sydneian, but because it
happens to be the place chosen by them. Primarily this office will be
for the purpose of commerce and trade, of trying to increase commerce
and trade between the two countries. I hope, looking at the balance sheet
it will be of advantage to us.
Secondly, because Russia has recently joined the Continental
Shipping Conference they asked that they would like the Biltic Shipping
Company to establish an office in Sydney. We think this will give us
access toport to the South of China, but also. Anian Russia and the
opportur. ity tc be able to sell our goods and services there.
Thirdly, they have asked us, if we could agree to visits by
Ministers. That has already occurred.
Their Minister for Agriculture, a member of the Central
Committee of the Communist Party, has visited Australia Sir John
McEwen has visited Russia.
They have also proposed, and we have agreed, that there
shouldi* ae missions, or delegations of Parliamentary Members tc move from
one country to the other.

This, I believe, shows our good will and the fact that we
want under the conditions that I have mentioned to show an earinest of
our intentions despite the fact that we know they are building up their
forces in the Middle East, beyond what is necessary for perce-keeping
purposes there. They are suspect in some regards, and we are entitled
to be sceptical. Nonetheless they took the initiative and we have
responded. From . now on, at least the ball will be in their court, At
least we can say this that so far as Australia is concerned: They have
indicated clearly to us that their recent decision to purchase millions of
pounds of Australian beef was based on their desire for good relations
with us. That is our position with regard to the U. S. S. R. I now turn
to the part of my speech that I want to emphasise tonight.
I want to emphasise to you that every phrase I use was coined
some time ago and certainly a long time before the ping pong diplomacy
was invented and practised under the skilled guidance of Mr. Chou En-lai.
The China Paper was prepared in February of this year. Let me talk
about the People's Republic of China and let us look at our relations in
both a multilateral and a bilateral way.
In multilateral terms. We believe they are anxious to -become a
member of the United Nations. The suggestion has made from time to
time that China wants to adopt a global approach. They are entitled to do
so as a great power. Consequently, those who have watched the U: nited
Nations have been asking themselves the simple question What do we
think are the prospects of the People's Republic becoming a member of
the United Nations in the course of the next year or two?
I want to say to you clearly a;-d emphatically that there is
little doubt at all, in fact it is almost certain that this year or next year,
Mainland China will become pcrticularly if it makes certain concessions
a member of the United Nations and will hold the permanent seat in
the Security Council that is now held by Taiwan China.
In the face of this inevitability, we will do nothing to obstruct
it. We do so against this background.
The Government in Peking is the defacto government and is
responsible for 700 million people. It controls the land mass of
Mainland China. So too does the Government of Taiwan China excercise
power and control over 141 millior people And over the territory,
that is comprised within the jurisdiction and central writ of the
Government of Taiwan. It is our view, therefore, that as the government
of Taiwan has lived up to the principles of the United Nations we should
assist it to remain a member. We are trying with all the influence we can
to sustain the position of Taiwan, and give it the opportunity to remain
in the United Nations should it, in its own wisdom wish to remain there.

. So that then is roughly our position on a multilateral basis, so far as the
People's Republic of China and the Government of Taiwan are concerned.
I now want to turn to our bilateral relations with Mainland China.
And I want to state our reservations.
I want to express those reservations coolly, and not stridently. When you
are making a diplomatic approach of the kind I will mention the less strident your
approach, the better your prospects of success will probably be.
I don't want you to think that there have been any great changes so far as
Mainland China is concerned. They are masters of tactics. They control the news
media there and they can more or less do what they want to do without great trouble
from the domestic population.
We in all our dealings must remember the domestic population exercises
a powerful influence on what we do. No democratic government ought to get too far out
of line with the trends of thought of the people of their country.
I remind you of an incident that occurred in 1969, not very long before the
last Federal elections. One phrase in a very well-presented and prepared speech
by one of the most cautious diplomats we have in Australia's foreign service a phrase
relating to the presence of the USSR Navy in the Indian Ocean caused a degree of
controversy that every one of us would have preferred to have avoided. In other
words, eight or nine words, caused difficulties and a tremendous amount of public
disapproval. This is why we have moved with a great degree of care. We have not wished
to move in a way that we felt would insult public opinion.
I want you to understand, too, that the People's Republic of China, that is
Mainland China, still proclaims in most of its public statements, and particularly in
its latest May Day addresses, that it believes in revolution and believes in achieving
its purposes by force. It is still bitterly critical of the United States and it uses the
words " All its mad running dogs" that is those who co-operate with the USA in its
desire to sustain the liberal democracies.
In those circumstances, what policies have we adopted? We have decided
that our long-term objective will be, I now use the phrase that was coined in the
documents that I mentioned and was used before by my colleague, Mr. Bury, the
Minister for Foreign Affairs or if it wasn't by him, by the Acting Minister on his
behalf. The words used set out our predetermined goal. That we want normal
bilateral relations with the People's Republic of China.
We want those relationships, but we have decided to proceed cautiously.
Because as I have said, we must always be adding up the sums to see that the major
advantages are with this country.
We decided to take the first step towards a diplomatic detente and took
the initiative to open up discussions with them. I used the phrase one day this
week I think on Tuesday that we want a dialogue between the two countries. 0 0 / 8

Initially we hope that we will be able to move in certain areas I will mention
latdr. Before I mention these areas, I want to dispel certain doubts that have arisen
about our attitude to Mainland China. I think there is so much misunderstanding
about what our present relationships are that I ought to stop the rumours and let you
know the facts so that you will be able to judge what the prospects for the future are.
Our present attitude to Mainland China is pretty clear. There is no
restriction whatsoever on the movement of Australian people to Mainland China,
providing only that they can : get a visa from the Chinese and providing that security
considerations are not involved. In other words, we don't stop our people going
there and we ' don't stop their people coming here. We will give them visas on the
conditions, or subject to the conditions that I have just mentioned.
Secondly, but for several restrictive lists on trade, we do permit trade with
Mainland China. Now at the Canton Fair, we have many, many Australians trying
to fill their order books. And indeed they have met with success in many cases.
Thirdly, our cultural activities. Not so long ago there was an approval for
the Peking Opera Company to come here. Because the only theatre that was available
for them had closed down, they were not able to come.
I want now to illustrate the way misunderstandings are occurring. I want
to mention the facts relating to wheat sales to Mainland China. They are these.
Continental China has had nine good production seasons for wheat. They
don't need to import any other than special varieties to mix with the wheat that they
produce themselves. They have had very good rice production which they normally
sell at a premium in order to buy the blending types of wheat that they need. Rice
is now in abundance. Consequently we did not expect that we would be making large
sales of wheat to them this year. As they have built up the stocks they have, they
need only the blending varieties.
Our position is therefore clear. Until a few weeks ago, our contracts for
the sale of wheat in other countries were far greater than they have * ever been.
We now think that we will have a carryover, which won't be a large one the present
carryover from last year's crop is about 365 million bushels much less than
200 million bushels. I believe it will be substantially lower than that.
In the cour se of the last two or three days, we have negotiated a sale to
the United Arab Republic of something like one million tons.
It is argued that Peking China is playing politics with the purchase of
Australian wheat. Not only do the facts deny it, but it wouldn't be a sensible sort
of politics. Our sales are pretty good and our stocks will be pretty low and of the
kind that we will need in the intermediate period between seasons.
Now we are moving towards a dialogue. Shortly we will be taking the
preliminary steps. We have already taken other action. see / 9

% The present restrictive lists are now being analysed and liberalised. The
only. restrictions that we will impose on trade and this will be of interest to every
one of you businessmen are those invdving defence interests or where there are
strategic Implications of a kind which our Department of Defence, Foreign Affairs
Department and my own Ministry feel require restrictions.
I want to remind you that China is a great and powerful country and is
starting to indicate that she is interested in becoming a great world power. We feel
that simply because it is Communist there is insufficient reason to prevent us
improving our relations with her. Secondly, we have to recognise that China wants
to exercise a world role and to be able to play a part in the future trend of world
affairs. There is growing evidence that since the Cultural Revolution and the change
in the power structure of the Peking hierarchy, particularly under the Premiership"
of Chou En-Lal that they are searching for the opportunities to do so. It would be
extremely foolish for any of us to think that this trend could be resisted because Mainland
China is strong and determined. This is one of the reasons why we feel that a dialogue
may be important to us.
We want to probe their feelings. What they are thinking about the
Western democracies. In our turn to be able to take some action to influence the
decisions that they might make.
We are now moving along a different track. I have mentioned trade to you.
I now want to mention various other kinds of activities. The issue of visas, the
protection of Australian personnel who are in Mainland China, cultural and other
types of activities, particularly the arts.
Shortly after I announced on Tuesday that we were attempting a dialogue
the irrepressible Dr. Coombs was on the phone and asked me would I give him
authority to negotiate with the Chinese to bring out ballet companies, opera companies
and any other type of artistic team that he felt might be entertaining to the
Australian people.
We will be moving in these and other directions to try and see whether
there is a basis on which we can have a rapport.
And I want to say this clearly. We will be moving cautiously. Every single
step will be weighed up before we take it. Every single step will be included in
the balance sheet that I mentioned.
We don't want to be pushed into taking action because somebody else has
done so. I warn you that recognition or admission will not make a great deal of
difference to Mainland China. Many countries have realised that even though they
have recognised Mailn. China it hasn't meant that they . havj incioascd their trade.
At least in the casc of two ccuntrics there has been a reduction, Th -re 1-wo riot been
an increase in trade. The Chinese Govornmient hais lot th aren't goad enough and-that political influcncco are not sufficient tc win them the kind
of contracts that they could not win in competitive company. 1

This is the attitude we'll take. We want to move. But we will only move
if movement will be for the benefit of the Australian people and we do not prejudice
our negotiating strength.
That brings metherefore to the conclusion. In all our international
relationships, we in the Foreign Off ice and in the Government and the Prime
Minister's Department particularly, will be seeking to protect and enhance your
interests as Australians. Not only our vital defence and security interests, but
also our trade and our cultural relations.
One of our objectives will be to provide aid and to participate in the
economic development of the less developed countries of South East Asia.
Everywhere I have gone over the period of the last two years as Foreign
and External Minister, I have been delighted but' surprised to find that there was
so much goodwill for us. In some international conferences, when a stalemate has
occurred, some countries have come to us to find a solutioiu
We are, I believe, a phenomenal country. Our aid programmes the money
that comes out of the pockets ofc the Australian taixpayer are substantial. We are
making a large contribution.
I come back to where I started. Our objective must first of all be to
protect and enhance our vital interests. And I use the phrase again we want political
stability in the Pacific Basin. We also want economic development because we
know it is a two-way traffic. As other countries develop so too will we. Above all
we want peace and we want to make our contribution-to the hopes and aspirations
of these people. If in time we achieve peace in Indo-China, Laos, Cambodia and
South Viet-MNm the kiddies there will be able to look forward to a future just as
bright as ours.

Transcript 2419