Sky News PM Agenda, interview with David Speers, Canberra

JOURNALIST: I want to turn thoughright now to what is a significant development whichever way you look at it inthe Middle East and that is the fall of Raqqa or the return of Raqqa if youlike, from Islamic State which has laid claim to a so-called caliphate acrossnorthern Iraq- northern Syria and western Iraq for quite some time now. Andfinally its forces, the Islamic State forces have been defeated in the city.With me now is the Foreign Minister Julie Bishop, thank you very much for yourtime this afternoon.

JULIE BISHOP: Good afternoon David.

JOURNALIST: Firstly, what can youtell me about any role Australian forces played in this?

JULIE BISHOP: Australian forces havebeen playing a role in terms of air support. The RAAF has been supportingcoalition strikes over Syria on ISIS strongholds.

JOURNALIST: Including Raqqa?

JULIE BISHOP: Including Raqqa andindeed we played a role in this final effort to retake Raqqa from ISIS, fromthe terrorist organisation and this is a significant milestone in the globalfight against terrorism. al-Raqqa had been claimed as a caliphate, it was thede facto capital, the headquarter for ISIS in Syria and Iraq and this takesaway the magnet, the attraction of ISIS for foreign terrorists fighters inparticular, but it also means that we are making significant progress indefeating ISIS in Syria and Iraq.

JOURNALIST: Well indeed, I mean thewhole notion of this caliphate that Islamic State could essentially be agovernment of this region, is that now over?

JULIE BISHOP: There are still somepockets of ISIS fighters, they are heading south. The Euphrates River Valleyarea will be perhaps the next theatre but we have also had success in Mosulwhere 90 per cent of the territory previously claimed for ISIS has beenreclaimed by the Iraqi Government and now with the fall of Raqqa after a longand bloody siege we do see significant progress. This is a major blow to ISIS.

JOURNALIST: So how does that changethe nature of the war in Syria? Are we going to continue playing a role withair strikes there?

JULIE BISHOP: We are concerned that itwill metastasise. We'll see pockets pop up elsewhere so that's why the fight isnot over. We have to continue to identify, seek out, and neutralise ISISfighters wherever they are and of course we are concerned about those who maywell survive and make their way back to other parts of the globe, including toour region and indeed Australian citizens who are fighting in Iraq and Syriastill, could make their way back to Australia. There are about 110 Australianswe believe still in Syria and Iraq who are supporting the terroristorganisation.

JOURNALIST: So the concern is theywill now, after Raqqa's fall, more likely try and return home?

JULIE BISHOP: Should they survive. About 80, maybe 83Australians have been killed fighting for ISIS by the anti-ISIS forces and byothers.

JOURNALIST: But you are now concernedabout the 110 or so …

JULIE BISHOP: Yes.

JOURNALIST: …Australians now wantingto return home?

JULIE BISHOP: I don't know whether all110 will but there is that potential and that's why we're tracking them.They're under surveillance to the extent that we can. We're working withpartners in the region to exchange information, intelligence, and we will seekto track them and to intervene so that they can't carry out a terrorist attackon the way home or indeed in Australia.

JOURNALIST: As you say, there's stillgoing to be insurgency and there are a number of issues around Syria, whathappens with the Assad regime though? I mean this is a government that has beenaccused of crimes against humanity, using chemical weapons as we know; whatneeds to happen there now?

JULIE BISHOP: Well unfortunately theAssad regime will have to be part of the negotiations toward a politicalsolution. What we don't want to see is Syria fall into complete anarchy. Therehas to be a political solution. There is now a Raqqa Civilian Council that'sbeen set up to focus on local governance in Raqqa but the coalition will haveto work with the Assad regime and Russia and Iran and others who have beenbacking Assad to find a political solution that involves all Syrians.

JOURNALIST: As part of it, does Assadneed to go? Does Assad need to go?

JULIE BISHOP: At this point,Australia's position has been that Assad must be used to negotiate thepolitical solution. We've never subscribed to the theory that Assad must go asa precondition to any discussions of political solution. We thought that thatwas counter-productive, as appalling as his regime has been. We need to ensurethat we focus on the outcome, not just the process.

JOURNALIST: Now, closer to home, theFilipino President Rodrigo Duterte has declared the southern city of Marawi inthe Philippines has been liberated from pro-Islamic State militants. Has itbeen liberated?

JULIE BISHOP: There are still a numberof fighters in Marawi but huge progress has been made particularly with thedeath of two of the major figures Hapilon and Maute. Hapilon was theself-declared Emir or indeed he was declared the Emir of ISIS in thePhilippines by ISIS in the Middle East, and Maute was the leader of IslamicState in the Philippines. Both those significant terrorist leaders have beenkilled and that does take away a great deal of the momentum from the terroristorganisations or the militia and networks that are connected to ISIS in thePhilippines. So progress has been made and clearly Marawi has been freed fromthe intense siege but we are continuing to provide assistance to ensure that it– ISIS – doesn't emerge in other pockets in Southern Philippines.

JOURNALIST: Can I turn to Chinafinally, the party congress- the 19th People Congress is now underway. ThePresident Xi Jinping is laying out his plans for a second five year term. Whatdo you make of where China is at and where China is going from what you'rehearing from this people's congress? I mean is China becoming a more opensociety or not?

JULIE BISHOP: In fact power is beingconsolidated around President Xi Jinping in perhaps unprecedented ways. Hiscrackdown on corruption has meant that factions have been dismantled, that hehas been able to appoint loyal and competent supporters around him. So thecomposition has changed considerably in the Party sense. I note the Presidentis speaking about "socialism with Chinese characteristics", a form of statecapitalism and I think we'll see a greater intensity and focus on state-ownedenterprises, even to the extent that the private sector in China has flourishedto a degree.

JOURNALIST: So opening up some ofthese state-owned enterprises to greater competition or quite the opposite?

JULIE BISHOP: No, I think there will be a greater concentrationof power within the state-owned enterprises.

JOURNALIST: Is that a concern forAustralia?

JULIE BISHOP: Well we are concernedabout open, free, transparent, accountable trade and competition. China hasachieved its aim of doubling GDP by 2020, well it's way on its way to doublingGDP by 2020 from the 2010 target standard. And that's an extraordinary outcomein anybody's language and with their GDP growing at something like 6 or 7 percent, their economic growth continues to be remarkable. But we are concerned toensure that China remains a free trading nation. We very much support theChina-Australia Free Trade Agreement. It's been hugely beneficial and we wantto see that openness and that trade liberalisation continue.

JOURNALIST: But from what you'resaying, there is a concern there about the approach now being taken, the plansare being laid out as to how those state-owned enterprises will work.

JULIE BISHOP: Well that's always been achallenge and rather than the state-owned enterprises becoming more open, thereis a concern that they will be less transparent and so we would urge China toensure that state-owned enterprises and that the private sector in China isable to flourish.

JOURNALIST: He's also - the President- just finally reiterated that Taiwan, Hong Kong, these are all parts of China.What's Australia's view on this? I mean we know this has been Chinese policyfor a long time, but does Australia- how does Australia view Taiwan inparticular?

JULIE BISHOP: Well Australia hascommitted to a One China policy. That remains the position. We've not changedthat. We are very close partners, trading partners with China. We have a ComprehensiveStrategic Partnership with them and we acknowledge the rising power of Chinameans that it will want to exert its power in a number of ways. We urge Chinato be a promoter and supporter of the international rules-based system that hasenabled China's economic rise. This is the system that's been in place sincethe Second World War of a web of treaties and alliances and institutions thathas maintained the relative peace and stability in our region and has enabledeconomies like China to rise.

JOURNALIST: Foreign Minister JulieBishop, appreciate your time this afternoon. Thank you very much for that.

JULIE BISHOP: ThanksDavid.