JOURNALIST: Australia is looking to reshape Australia’s foreign policy over the next ten years. Let’s get the perspective from Australia’s Foreign Minister Julie Bishop. She joins us today. Minister, good to have you with us. Now, later today you’ll be delivering a keynote address looking at change and uncertainty in the Indo Pacific region. What are the biggest challenges, and how do you see Australia navigating all of them?

JULIE BISHOP: We are going through a period of extraordinary change, and over the last 12 months there have been unprecedented events: Britain exiting from the European Union; the successful campaign of President Trump in the United States. There are also challenges to our assumptions on the international rules-based order that has been the framework since the Second World War for the prosperity and security of our part of the world in particular. All of this is under challenge at present and so I’ll be speaking about the challenges, but also the opportunities I see, and the role that Australia can play to continue to advocate for that open rules-based order that has enabled countries, particularly in our region, to prosper in recent times.

JOURNALIST: How concerned are you that economics and trade have been muddled into geopolitics?

JULIE BISHOP: There’s been a rising sentiment embracing protectionism. We’ve seen strains of economic nationalism in countries and so countries such as ours, and Singapore, that have benefited from an open rules-based order when it comes to trade – market economies, export-oriented market economies – should make and remake the case for the benefits of open competition and globalised trade. Australia has benefited enormously from being able to sell our goods and services around the world. So we must argue against this rising protectionism that would only see economies suffer if it were to roll out across the globe, and indeed the region.

JOURNALIST: There is a big question mark when it comes to the US foreign policy in Asia. The ‘Asia Pivot’ is as good as dead. How do you think, under Trump, how do you think US policy will be in this part of the world?

JULIE BISHOP: Australia has been engaging very closely with the new Trump Administration. I visited Washington recently and I met with Vice President Pence and Secretary of State Rex Tillerson and their new National Security Advisor General McMaster, and our other ministers have met their counterparts. I’m reassured that the United States understands very well the need for leadership, the need for the United States to remain engaged in our part of the world. They will continue to do so and I think some high-level visits here in recent times, and some that are pending, will reinforce the view that the United States is committed to the rules-based order, including in trade and in security, that has served us so well in recent times.

JOURNALIST: But there have been growing calls for the US to show more aggression when it comes to China. There have been growing calls for Japan and Korea to foot more of the defence bill. Surely that must worry you?

JULIE BISHOP: Well, in fact with the growing economies in Asia and Southeast Asia, we’ve seen an increase in military budgets, and that’s commensurate with their growing economic weight. There’s been growing defence weight, in fact, the military budgets of Asian countries are growing faster than anywhere else in the world. But we need to ensure that we continue to put peace and prosperity at the top of our agenda, and that means the United States remaining engaged in our part of the world, and I have every confidence that they will continue to be a leader and deeply engaged in Asia, South East Asia in particular.

JOURNALIST: The new US Secretary of State, Rex Tillerson, is due out in North Asia. What are you expecting from that?

JULIE BISHOP: It will be very reassuring for South Korea and Japan for the Secretary of State to visit and Secretary Mattis, the Defense Secretary, was there recently. And I’ve travelled to South Korea subsequently and they were very reassured by the interest and the level of engagement from the United States, and the fact that Secretary Tillerson is visiting will also send a very positive sign that the United States is here, is engaged, and will continue to be so.

JOURNALIST: And despite what you say, some people also are concerned about the lack of leadership in this part of the world. I mean, the US pulling back. Do you see China playing a bigger role? Is the world ready for China to play a bigger role?

JULIE BISHOP: It’s inevitable that China will continue to grow economically, and militarily. It will become increasingly strategically important. And the question is whether China will be a responsible global player, and that is yet to be seen.

JOURNALIST: What would you like to see?

JULIE BISHOP: Well, I would like China to be committed to the rules-based order; abiding by the international rules that have guided countries’ behaviour since the Second World War. China and other countries should commit to that through the institutions that have served us well, but also, when China branches out in other areas like the AIIB – the infrastructure bank – its One Belt One Road policy, that it’s for the benefit of our region, not just for one country.

JOURNALIST: One of the issues here, of the South China Sea. Has Australia shifted its policy when it comes to the South China Sea?

JULIE BISHOP: Australia has been consistent throughout. We are not a claimant state. We recognise that there are a number of competing claims in the South China Sea, and we urge countries to deescalate tensions, to negotiate their differences peacefully. And we recognise their right to seek to turn to international bodies, such as under UNCLOS, should they need to arbitrate, or conciliate.

JOURNALIST: Do you see any resolution in sight?

JULIE BISHOP: We believe that countries should continue to exercise their rights of freedom of over-flight, freedom of navigation, and have unimpeded access to trading routes. After all, Australia has a deep interest in this. A majority of our trade to North Asia passes through the South China Sea. So we call for parties to deescalate tensions, not do anything that would be likely to escalate into any form of conflict.

JOURNALIST: A lot of talk about a potential US-China trade war. How real is that threat to you?

JULIE BISHOP: I believe that both sides have too much at stake for there to be a trade war. The United States has issues with China, China has issues with the United States, but I believe that they can be resolved by high-level consultation and discussion, and I’ll hope that we will see that. And the opportunities will arise, such as the East Asia Summit, a forum where China, Russia, the United States, Australia, the ASEAN countries come together to discuss economic and strategic issues. And I think the East Asia Summit, later this year, would be a great opportunity for President Trump to come to the Philippines, where it will be held, and for the other leaders to make their views known at that time. 

JOURNALIST: Minister, just one final question: is this the new normal?

JULIE BISHOP: I suspect that the increasing anxiety, the increasing challenges, the sheer scale and pace of change, are going to be with us for a very long time.

JOURNALIST: Alright. Uncertain days ahead. Minister Julie Bishop we thank you for insights today.

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