LEIGH SALES: The relationship between the US and China has become even more tense. At the weekend’s APEC summit they were in open disagreement over trade, security and the Pacific region. The hostility between the two powers meant that the gathering of leaders couldn’t agree on a joint statement at the end of the summit — the first time that’s happened in its history. So what does that mean for Australia’s interests in the Asia-Pacific region? Earlier, I spoke with the Foreign Minister Marise Payne.

Minister, thanks for being with us.

MINISTER PAYNE: Great to be here.

LEIGH SALES: When we look at the currently frosty relationship between the US and China, they’re competing for influence in the Asia-Pacific, is it a reasonable assumption that we’re heading for another Cold War?

MINISTER PAYNE: Well, I think using old terminology to discuss current events is probably convenient but not necessarily accurate.

Certainly, there are tensions and we have encouraged both sides to talk more and to communicate more, and I was pleased to see the Presidents engage in a conversation recently, but obviously there is more to do in that space.

We were disappointed that we did not get a joint communique out of the APEC meeting. But I think a Chair’s statement was a good compromise position and we look forward to seeing that from Prime Minister O’Neill.

LEIGH SALES: Australia’s Foreign Policy White Paper projects that by 2030 the Chinese economy will be worth $42 trillion versus $24 trillion for the US. Isn’t it inevitable that, given that, China will eventually win the battle for regional dominance?

MINISTER PAYNE: Well, I think we are all interested in making sure that we play our own roles and our own part, and what the Foreign Policy White Paper — and before that the Defence White Paper — set out was the task for Australia in terms of our responsibilities and engagement the region, so we’re obviously prosecuting that case.

LEIGH SALES: [Interrupts] But aren’t we going to have to do that against the backdrop that China is going to become the most influential player in the region?

MINISTER PAYNE: Well, I think the US is continuing to make its contribution, and I think that this is a very long story. It’s not a short story. It’s a long story and one that will take time to play out. But what we have to make sure we’re doing is prosecuting the case for Australia in our national interests with both parties.

I’ve obviously been to Beijing recently and had a very productive visit and a constructive meeting with my counterpart State Councilor and Foreign Minister, Wang Yi. That’s an important part of our engagement, as is the Prime Minister’s meeting with Li Keqiang.

We have very deep and long-term engagements with the United States and have been working very hard with the Trump administration and its senior officials over the past couple of years to ensure that we are prosecuting the case for Australia’s national interest. So we operate against that backdrop.

LEIGH SALES: Australia has announced that with the US it will set up a joint naval base on Manus Island. What for?

MINISTER PAYNE: So I think it’s important to remember that it’s a Papua New Guinea naval base. So it’s a naval base in which Papua New Guinea has invited Australia and the US to partner.

LEIGH SALES: But what’s it for?

MINISTER PAYNE: Well, one of the reasons from our perspective is that Lombrum is already the home of the older Pacific patrol boats that Papua New Guinea holds. We are gifting them as part of our Pacific Maritime Security Program new Guardian-class patrol boats: larger, more capable. The base needs to be upgraded, the facilities need to be developed …

LEIGH SALES: [Interrupts] And will there be Australian personnel and ships based there?

MINISTER PAYNE: Well, not necessarily Australian ships, but we already have Australian personnel based in locations in Papua New Guinea with the PNG …

LEIGH SALES: [Interrupts] A big expansion though in this space?

MINISTER PAYNE: Not a very big expansion, no, but part of our upgraded, if you like, set of activities under that Pacific Maritime Security Program, just as one example. But we do a lot of this work. The Defence Cooperation Program that we have with Papua New Guinea is our largest Defence Cooperation Program in the world.

LEIGH SALES: So who’s paying the mostly for the base: us, the US, or PNG?

MINISTER PAYNE: Well we’ll be making a contribution out of Defence funds. Papua New Guinea will make their own contribution. The US will make their own.

LEIGH SALES: Who’s making the biggest?

MINISTER PAYNE: The details are yet to be finalised.

LEIGH SALES: Why is Australia deepening its ties with the US at a time when it’s being led by an inconsistent and unreliable President?

MINISTER PAYNE: Well, it’s an interesting way to characterise deepening our ties. Our ties are already very, very deep and very, very strong. Whether we are developing our engagement in the Pacific or more broadly internationally, that is a consistent approach from Australia. We have the deepest alliance of the region and it is one that we value enormously, so we work together very, very closely.

LEIGH SALES: But is it still a trustworthy partner under the leadership of Donald Trump?

MINISTER PAYNE: Well we have the strongest foundations in that partnership and we work closely with them, and yes, it is a strong and trustworthy partner.

LEIGH SALES: Regarding the plan to possibly move Australia’s embassy in Israel from Tel Aviv to Jerusalem, Scott Morrison announced that he was exploring the option on 16 October. As Foreign Minister, you were first informed on 14 October. Why was the Foreign Minister brought into the loop so late?

MINISTER PAYNE: Well I think the Prime Minister was contemplating his options. He had been having a number of conversations following his appointment as Prime Minister on that topic and I presume many others. And as he progressed those, he engaged with me and other counterparts around the National Security Committee.

What we have in place is a process for consideration of Australia’s national interests in relation to this matter, but predicated on two key things. One, our support of the two-state solution in the Middle East and for those aspects of the peace process, and two, our respect for UN Security Council resolutions and their application and they are underpinning the work we are doing.

LEIGH SALES: You mention Australia’s national interest. What national interest could be served by us moving the location of an embassy?

MINISTER PAYNE: Well I think we always have to contemplate our alliances, our friendships, our relationships in our own national interest …

LEIGH SALES: [Interrupts] But what is the national interest that would be served by …

MINISTER PAYNE: [Interrupts] Australia’s best interest is clearly the foundation upon which we make that assessment.

LEIGH SALES: So how would moving that serve Australia’s best interest?

MINISTER PAYNE: Well, in terms of our relationships more broadly, whether we can, in that engagement, contemplate the peace process becoming a slightly more productive process than it currently is. I think that has certainly been commented upon by many - that the peace process is not making any progress as such. But most importantly, we have a process in place. The Prime Minister will receive the analysis and the report of that process in December and make his decisions at that time.

LEIGH SALES: Was moving the embassy something that was ever discussed under the Turnbull Government when you were Defence Minister?

MINISTER PAYNE: Not in that context with me as Defence Minister. But I’m sure it was a discussion with the Foreign Minister and the Prime Minister at the time.

LEIGH SALES: So what’s changed from the Turnbull Government to the Morrison Government that it’s now at the sort of forefront of the foreign policy agenda?

MINISTER PAYNE: Well I think the Prime Minister has made clear that it is a matter on which he wants to seek advice and which he wants to review. We are of course able to do that as the government of this nation, and we are able to review that in conjunction with the concerns and issues that have been raised with him.

LEIGH SALES: Minister, thank you very much.

MINISTER PAYNE: Thanks Leigh.

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