LAST week, the Australian navy frigate HMAS Ballarat arrived in China and moored off Shanghai's historic Bund.
Ballarat is an unusual sight on the shoreline of one of China's biggest business and commercial centres. But it's a symbol of our recent history and our growing friendship.
Australia is one of only two countries to have military dialogue at the highest defence levels with China. On this occasion, HMAS Ballarat is in China for a different reason. It's there as part of a program of activities to celebrate the 40th anniversary of diplomatic relations between Australia and China in 1972.
Four decades ago one of my political heroes, Gough Whitlam, initiated this far-sighted shift in foreign policy from opposition and gave it effect after he was elected Prime Minister. Now, in the Asian century, the relationship between Australia and China is broad and deep and covers much more than the massive trade in mineral resources and energy and the growing investment profile between our countries.
Our $113.3 billion in two-way trade last year included supplying China with almost 50 per cent of its total iron ore imports and 25 per cent of its coal imports.
We are also building a stronger commercial relationship in services and agriculture.
So there's no doubt that global and economic power is shifting to Asia and a large part of the shift is the re-emergence of China.
As the new Foreign Minister, my first visit to China was a priority. In Shanghai, Beijing and Shenyang I met members of China's political and military leadership. I also met with business people and academics.
With my Chinese counterparts, we discussed our bilateral relationship and ways to strengthen the full range of our economic and strategic ties.
On this visit, I made the point that a prosperous China, constructively engaged in regional and global affairs, was good for China, good for the region and good for Australia.
I also said that China's economic growth will naturally be accompanied by military modernisation. There should be no surprise in this. The same is true for countries like India, Indonesia and indeed Australia. But the manner in which China exercises that strength is being watched closely by China's neighbours in the region.
Australia has a strong interest in a mutually beneficial relationship with China.
Thirty years after Deng Xioaping announced the open door policy, China is on the international stage.
We want to see China playing a constructive role in a rules-based international order.
And we look forward to seeing China play a stronger role in international meetings, commensurate with their growing economic strength.
As China continues to grow, the forces of globalisation and economic integration will influence the direction and tone of relations in Asia.
But I do not believe that China's rise is America's decline.
As the saying goes, all boats rise on the same tide.
America will remain the dominant global power.
I don't subscribe to the theory that the US is in decline. Positive indicators on US population growth, investment, innovation, higher education and entrepreneurship, point definitely the other way.
But the pace of geopolitical change in Asia is quickening.
I have no doubt that China's re-emergence as a more active security partner will shape the future of the Asian order.
Australia is well-placed to meet these challenges. Our strategy is one of partnership, maintaining our historic alliance commitments, like ANZUS, and engaging with new centres of power in the region.
We must do so in a way that strikes the right balance between our historical ties and our Asia Pacific location.
As I said in Beijing, we see China through its long history. But in turn, Australia should be viewed through its own. In our modern history, since the end WWII , we've been in a strategic alliance with the US - and this is now in the Australian DNA.
We are a confident, creative, forward-leaning middle power. Alongside the region's other rising powers, we have a critical role to play in shaping the future direction of our region.
We begin that task with some clear strengths: our growing strategic partnerships with the major powers in Asia, our 60-year alliance with the United States, and a strong sense of self-reliance.
Above all, we want a strategic order in Asia where great powers cooperate and threats to stability are minimised.
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