2GB, Sydney - interview with Chris Smith

CHRIS SMITH: As I said earlier Japanese Prime Minister Shinzo Abe has arrived in Australia. It's avisit that will include an address to a joint sitting of Parliament and theissues of free trade and energy security are said to be the main topics fordiscussion.

Energy security, it's reported, will be the key underlying issue with Japanreportedly looking at doubling LNG volumes from Australia and Papua New Guinea,doubling, so at the moment more than 60 per cent of Japan's gas that is used toproduce power comes largely from the Middle East. Now the gas is shipped throughdisputed waters in the South China Sea where you've got China, South Vietnam andthe Philippines involved in what's been described as 'open territorialconflict'. Increasing gas and LNG imports from Australia and PNG from 18 milliontonnes a year to 36 million would aim to avoid that.

Mr Abe and Tony Abbott will sign a Free Trade Agreement known as theJapan-Australia Economic Partnership Agreement which Mr Abe has described as"very significant". Mr Abe says that Australia is the largest trading partnerJapan has concluded such an agreement with. As I said earlier, Mr Abe has alsopointed to the history behind the agreement and it's quite interesting - in 1957his grandfather, and then Prime Minister, Nobusuke Kishi welcomed Robert Menziesas the first Australian PM to visit Japan in the wake of World War 2.

I thought we'd talk about all of this and some other current issues, there'splenty of those too, with the Foreign Minister Julie Bishop who is on the line.

Minister good morning.

JULIE BISHOP: Goodmorning Chris.

CHRIS SMITH: Thankyou so much for your time. How important and significant is this visit by PrimeMinister Abe?

JULIE BISHOP: This is avery significant, indeed historic visit. During this visit to Australia PrimeMinister Abe and Prime Minister Abbott will sign the Japan-Australia EconomicPartnership Agreement or a Free Trade Agreement. This is enormously good newsfor Australian business because they'll be able to get goods into Japan atreduced or zero tariffs, great news for Australian consumers who'll be able tobuy cheaper Japanese goods.

And it is the first such agreement that Japan has undertaken with a developedeconomy and it's by far the most liberalising trade agreement that Japan hasever included. So it's going to deliver significant benefits particularly toAustralian farmers, manufacturers, exporters, service providers and of courseour consumers.

CHRIS SMITH: Yousay that you'll get cheaper prices on Japanese goods for Australians but, youknow, the truth is there's always a degree of cynicism towards these so calledfree trade agreements with Asia, any Asian country, because we cannot compete onwages. Are there guarantees in this agreement that those benefits will flow on?

JULIE BISHOP: Well underthe agreement, let me take resources and manufacturing, on entry into force ofthe agreement, almost 100 per cent - 99.7 per cent of Australian resource,energy and manufacturing product will enter Japan duty free. Then on fullimplementation of the agreement all of our resources, energy, manufactured goodswill benefit from duty free entry into Japan. Now this is a multi-billion dollarsector of the economy. These products exported to Japan in 2013 were worth over$40 billion. So there will also be big benefits for Australian consumers becausetariffs on Japanese imports will be eliminated on full implementation.

So this is a significant agreement and it's something that we took to thelast election as an election policy. We promised the Australian people that wewould work very hard to conclude free trade agreements that benefit Australianbusinesses and Australian consumers with South Korea, Japan and China. Wellwe've concluded one with South Korea, we're now about to sign off on theJapanese one and we're very busy negotiating a Free Trade Agreement with China.So these are all designed to boost the Australian economy, boost jobopportunities and to open up new markets or enhance existing markets for ourexport businesses.

CHRIS SMITH: Ithink it's fair to say that the consumer focuses on our relationship with Chinawhen we think about and purchase goods on a daily or weekly basis but untilrecently Japan was our number one trading partner wasn't it?

JULIE BISHOP: That'sright. From the time of the 1957 Commerce Agreement, to which you referred,Australia and Japan have had a very broad and deep relationship and for manyyears Japan was our number one trading partner and it's only been surpassed inmore recent years by China because of China's immense growth and its economy isdemanding iron ore and coal and other resources from Australia as its economydevelops. And Japan is now our second largest trading partner, our third largestforeign direct investor but that still means Japan has been for over manydecades a most significant partner.

Now I come from Western Australia and I know how important Japan has been tothat state and of course the West Australian resources sector. I would say itdrives the Australian economy, people on the East Coast might differ, butnevertheless Japanese companies have been very responsible corporate citizens inWestern Australia, and indeed throughout Australia, for many many decades.

CHRIS SMITH: So isthat where traditionally foreign investment has gone?

JULIE BISHOP: Wellindeed the Japanese have been investing in significant levels in WesternAustralia in mining and resource projects for decades and I think it's quitefitting that Prime Minister Abe is visiting the Pilbara with Prime MinisterAbbott. And this is about 40 years, in fact exactly 40 years, since a previousJapanese Prime Minister, Tanaka, visited Western Australia's North West in 1974and that preceded the huge growth in Japanese steel making and so that's whenthe relationship with the Pilbara really took off after the previous PrimeMinister visited the Pilbara. I think it's quite fitting that Prime Minister Abewill visit the Pilbara and it's also as you mention, quite a historic nicetythat it was Prime Minister Abe's grandfather, Prime Minister Kishi who signedthe original Commerce Agreement in 1957 with Robert Menzies.

Tonight we will be awarding the Kishi Fellow to a young Australianundergraduate who has been awarded a 12-month scholarship to study in Japanunder the Government's New Colombo Plan. This gives students an opportunity tostudy in universities in our region. It's a reverse of the original Colombo Planof the 1950s that used to bring Asian students to study in Australia and thesepeople have gone on to become political leaders, business leaders and communityleaders in the region. Now, the Abbott Government has reversed that and we'resending young Australians to study at universities in the region and so tonightwe'll be awarding a fellowship to a young Australian who will be studying for12-months in Japan and called the Kishi Fellow.

CHRIS SMITH: Anexcellent program.

I mentioned energy security earlier and suggested this is likely to be thebig underlying issue. Why?

JULIE BISHOP: Wellenergy security is so very important to Japan. Of course they had a focus onnuclear security, because of the Fukushima Tsunami incident they have downgradedtheir reliance on nuclear and they have a huge demand for energy and so they arenow looking to supplement with energy from other sources including LNG andthat's where Australia has so much to offer with our LNG projects. In the NorthWest of this state we can supply Japan.

It won't be only Australia, there's also a significant LNG operation in PapuaNew Guinea that will be supplying energy, LNG, to Japan and so I understandPrime Minister Abe is also visiting PNG which I know will be an historic momentfor the citizens of that country.

CHRIS SMITH: PrimeMinister Abe is also addressing our National Security Committee, would that be afirst by a Japanese leader?

JULIE BISHOP: I believeit would be. It wouldn't be the first by a leader of another country but PrimeMinister Abbott was invited to sit in on the Japanese National SecurityCommittee meeting and so we are returning the compliment. And I think it's apositive that Prime Minister Abe is going to take the opportunity to discuss hisannouncement recently that Japan will be exercising the United Nations Charterright to collective self-defence.

For decades Japan has demonstrated a really strong commitment to peacekeepingoperations, humanitarian and disaster relief and this decision will enhancethose efforts. We've worked very well with Japan in difficult securityenvironments overseas and I think this decision will support future efforts todeepen the practical defence cooperation we have with Japan.

I'm hoping Prime Minister Abe will explain the new policy. I understand thatunder this policy Japan can now respond in the event of an armed attack againsta close partner of Japan or where there's a clear danger to Japan's survival andto the Japanese people and so here we will be taking an opportunity to discussthat with him and I think it's important we be transparent about our defence andmilitary capabilities.

CHRIS SMITH: Okay,a couple of other quick issues and some which will develop later this afternoon- Sri Lanka is in the news, a case involving asylum seekers goes before the HighCourt at 2 o'clock. You've twice been to Sri Lanka, once as a Minister. Howwould you describe the political climate, and secondly, given the fact that weintercepted one of these boats outside of our waters, is it the jurisdiction ofthe High Court?

JULIE BISHOP: Well,you'll understand that I won't be making any comment because the matter isbefore the Court and it would be inappropriate for me to make any comment aboutmatters that the High Court will be dealing with.

But in relation to Sri Lanka, yes, I visited there in opposition as ShadowForeign Minister with Scott Morrison and with Michael Keenan, who is our JusticeMinister as well, Scott of course is Border Protection. We went there inopposition and we were accompanied by Tamil Members of Parliament to the northof Sri Lanka and so I visited the previous war torn areas of Jaffna andKilinochchi, all these Tamil areas in the North where most of the fighting wenton. And we've got to remember that the Tamil Tigers were, are a proscribedterrorist organisation. This was a bloody, horrible civil war for 30 yearsinside Sri Lanka.

CHRIS SMITH:Although the war is over are there reprisals still going on though?

JULIE BISHOP: There arechallenges in reconciliation.

CHRIS SMITH:Reprisals?

JULIE BISHOP: Not that Iwas aware of, and not that I have seen and we've had assurances from the SriLankan Government that that will not occur. I met with many Tamils both in theSouth and the North. I know they have challenges with reconciliation but theyare holding elections. There was an election in the North, the Tamils won by asubstantial majority, they have Members of Parliament, they are free to travel,they are free to speak. There's a very vibrant Tamil and Singhalese community inSri Lanka.

I believe the best way for there to be reconciliation between the Tamils andthe Singhalese after 30 years of the most horrible conflict is for theinternational community to engage with Sri Lanka and assist Sri Lanka inresettling people who are displaced by the war, reconciling their differencesand working with them so that it can be a country that fulfils its potential.

CHRIS SMITH: Soare the vast majority of those jumping on a boat and heading to Australia,whether it's with their dog or without their dog, are they – the vast majorityeconomic asylum seekers?

JULIE BISHOP: Well I canquote Bob Carr, former Foreign Minister of the Labor Party, and he said indeedthat these were economic migrants coming to Australia.

CHRIS SMITH: Doyou agree?

JULIE BISHOP: I don'tbelieve that Tamils are being persecuted in Sri Lanka. If anyone were in fear ofpersecution they can go to Tamil Nadu in India which is a mere few kilometresaway from Sri Lanka where India promises anyone experiencing persecution accessto medical services, educational services. In fact the United Nations, theUNHCR, says India is a model for the way it treats Tamils. So if you werefeeling persecuted or you had been persecuted in Sri Lanka you wouldn't get on aboat that is probably unseaworthy and pay criminal syndicates to travelthousands and thousands of kilometres at sea when you could get shelter in TamilNadu which is a few kilometres away.

CHRIS SMITH: Andworse still you don't take your dog with you if you think you're beingpersecuted. I don't get that.

You've described the situation with the ISIS extremists and Australiansthought to be fighting for ISIS at the moment as one of the most disturbingdevelopments on the security front in recent years. Is it getting worse?

JULIE BISHOP: I believeso. We are already tracking about 150 Australians who have been, or are, inSyria and Iraq and they are, to our knowledge supporting or promoting or indeedeven training with ISIS which is an offshoot of Al Qaeda, it is so violent thateven Al Qaeda has distanced itself from this terrorist organisation.

CHRIS SMITH: So ifthey weren't twisted, murderous extremists before they went, this is exactlywhat they'll end up being after this war?

JULIE BISHOP: Our fearis that they are being radicalised and that they are being brought into thisextremist terrorist organisation whose atrocities are truly appalling, who revelin mass executions and then we fear that they'll be coming back to Australiahaving trained as terrorists.

CHRIS SMITH: Canyou promise our listeners this morning that you won't let them back in?

JULIE BISHOP: I'malready cancelling passports, or rejecting passport applications from those whoour intelligence community believe put our country at a security risk.

CHRIS SMITH: Whatabout if their only passport is an Australian passport?

JULIE BISHOP: They arebeing cancelled.

CHRIS SMITH: Sothey will be stuck in this no man's land in the Middle Earth, northern Iraq?

JULIE BISHOP: I amcancelling passports on the advice of our intelligence community.

CHRIS SMITH: Whatis your advice to families of those who have either got people fighting for ISISin Iraq or Syria and/or about to send a family member over to that part of theworld? What's your advice to families?

JULIE BISHOP: My adviceto families, but particularly to the women, I'm urging them to see what they cando to prevent their husbands, or sons, or brothers, or uncles - please preventthem from leaving Australia and joining up with these terrorist gangs and thencoming back to Australia. They must do all they can, because it's an offenceagainst Australian law, terrorist offences are punishable by sentences of up to25 years in jail and..

CHRIS SMITH: …andthey'll be left on their own because they won't be allowed back in.

I've got to leave it there I'm getting to news but thank you so much for yourtime this morning Foreign Minister.

JULIE BISHOP: You takecare.