Speech
to the National Conference of Australia-Japan Societies
Adelaide, 20 September 2003
"Australia and Japan: Shared Interests, a Mature Understanding"
Introduction
Ladies and gentlemen
It is a great pleasure to be here at the 8th National Conference of Australia Japan societies.
I am grateful for this opportunity to talk about Australia's relationship with Japan - one of Australia's most important and mature bilateral partnerships.
One can say a great many things about the relationship.
As a trading relationship it has certainly been of great benefit - for both countries - and, despite Japan's current economic difficulties, will continue to be so.
Strategically we share many common perspectives, on regional and global security, and increasingly this is being translated into strategic cooperation.
But one can also say of the relationship that it is deepening - economically, politically, strategically, and perhaps most importantly, in our understanding of each other. And it is this understanding that has underpinned, and will continue to serve, the development of our broader bilateral ties.
A strong economic relationship
During Japan's economic boom years, commentators, journalists and even politicians queued up to tell us how important the trading relationship was.
In more recent years, however, those same commentators have tended to be more downbeat, focusing instead on Japan's economic downturn. Or indeed, quite understandably, concentrating on the rise of other important markets in the region, such as China.
But we should never lose sight of the fact that even with its current economic difficulties, our trading relationship with Japan remains vitally important.
Japan has long been, and is likely to remain for a considerable period, our largest export market. In 2002, Japan accounted for 19 percent of total merchandise exports - or $22.2 billion - almost double that of our next largest export market, the United States.
And despite current difficulties, Japan's economy is still the second largest in the world, and will be for some time. It is around 50 percent larger than the next largest economy, Germany.
And notwithstanding China's impressive growth in recent years, Japan's economy is still around 3.2 times the size of China's. Even at current growth rates China's GDP would not catch up to Japan's until around 2019.
In some respects one could say our bilateral trading relationship has reached maturity. The dramatic changes and advances of youth may be gone. But there are still areas in the relationship that can be developed.
In contrast to our overall trade relations, for example, the Australia-Japan investment relationship has remained relatively weak.
Australian total foreign direct investment to Japan at June 2000 was a strikingly low $340 million, compared to FDI to the United States of $90 billion, and to the UK of $40 billion.
And while Japan remains our third-largest source of foreign direct investment, with the stock of this investment valued at a total of $19 billion as at June 2002, annual foreign direct investment flows to Australia in recent years have been insignificant.
Similarly, while our export performance in resources remains strong, we are not doing as well as we should be in services trade, beyond tourism, or trade in products of newer industries.
It is these challenges, and others that we have sought to tackle through the Australia-Japan Trade and Economic Framework, recently signed by Prime Minister Howard and Prime Minister Koizumi.
The Framework reaffirms both Governments' determination to ensure the vitality of this hugely important trade partnership.
The Framework includes a trade and investment facilitation package aimed at making it easier to do business, through improved commercial and regulatory linkages.
These cover well-established sectors, such as food and energy trade; emerging growth areas such as Information and Communication Technology, and newer policy issues including competition policy and securities market regulation.
It is no secret, of course, that the Australian Government wanted to be a little more ambitious, particularly on the question of an FTA.
Nonetheless we were pleased that the Framework included a commitment to work towards comprehensive trade and investment liberalisation, an outcome that we pushed hard for.
This is likely to remain, however, a longer-term goal.
Shared strategic perspectives
Against the background of a strong economic relationship we are also seeing the strengthening of our political and strategic relationship.
A growing, though relatively recent, feature of our bilateral relationship have been exchanges and cooperation on strategic issues.
Of course Australia and Japan have long shared many common perspectives on regional security; for example on the importance of the US presence in underpinning regional stability; or on the dangers inherent in North Korea's efforts to acquire weapons of mass destruction.
But today we are doing more to share these perspectives, through, for example our political-military dialogue; the 1.5 track security dialogue between academia and government; and the Trilateral Security Dialogue between Australia, Japan and the United States.
And we are increasingly seeing this strategic dialogue develop into strategic cooperation.
Such cooperation is now a more prominent feature of the bilateral relationship than it was as little as two years ago, reflecting in part Japan's greater willingness to contribute to regional and international security.
In a significant development in July this year, Japan passed legislation enabling it to send its Self-Defence Forces to Iraq to assist with the reconstruction effort there. We hope Japan will be able to send a contingent there in the not-too-distant future.
And, of course, we have already witnessed the remarkable sight of Japanese and Australian military personnel working together for stability in East Timor.
But the threat posed by terrorism and the proliferation of weapons of mass destruction - and the terrifying prospect that these threats might combine - has also given new urgency to international and regional security cooperation.
During his visit to Japan, Prime Minister Howard and Prime Minister Koizumi issued a Joint Statement on Cooperation to Combat International Terrorism and an action plan to carry forward this cooperation.
The statement provides a framework for strengthening our joint efforts to address this key security challenge, including collaboration to increase the capacity of countries in the region to deal effectively with the threat of terrorism.
And, as most people would be aware, Australia and Japan are partners, together with a range of other countries, in the Proliferation Security Initiative - designed to prevent the illicit transfer of WMD-related material and their delivery systems, including to non-state entities.
In the Coral Sea last week we saw vessels of the Australian Navy and the Japanese Coast Guard, together with aircraft and vessels from other countries, involved in a joint interdiction training exercise.
And certainly Australia welcomes Japan's preparedness to take on a constructive international and regional security role, commensurate with its economic weight.
A solid foundation of understanding
The strength of our bilateral relationship is not just found in these tangible examples of economic, political and strategic cooperation. Cultural and people-to-people links are as much a part of the relationship as these other elements.
And the various Australia-Japan Societies and your Japanese equivalents are key players in maintaining and strengthening these links.
The understanding that has developed between our two cultures plays a vital role in underpinning the bilateral relationship more broadly. It has done so in the past, and it will certainly do so into the future.
In 1937 Yusuke Tsurumi, the prominent Japanese author and parliamentarian, visited Australia. During his tour, he expressed great confidence in what he saw as the potential of the Australia-Japan relationship to develop.
Tsurumi, who believed that an understanding of Japanese culture could only come from an understanding of the language, was encouraged by the rapid expansion in the study of Japanese language in Australian secondary schools and universities - yes that's right in 1937.
As we all know World War II quickly interfered with the budding interest both countries had in each other in the 1920s and 30s.
But we have certainly made up for lost time since then.
In the 1980s in particular we saw a major expansion in the teaching of Japanese in secondary schools and universities. Today some 34 Australian universities teach the Japanese language and/or Japanese Studies.
The impact of this should not be underestimated. The rapid expansion of Japanese language studies in the 1980s produced a new generation of young Australians with a deep knowledge of both the Japanese language and culture.
And it is really only in recent years that they have started coming into leadership positions, in business, the arts and in government - something which augurs extremely well for the future of the bilateral relationship.
But the interest and understanding is not one way. Like Tsurumi in 1937, many Japanese have found in Australia a culture and an environment with which, despite the significant differences, they are very comfortable.
More than 700,000 Japanese visit Australia each year. Surveys in Japan regularly see Australia voted as the most liked and trusted country by Japanese people.
And in the forty years since our first sister city relationship - between Lismore and Yamatotakada - some 99 cities in Australia and Japan have forged similar relationships; Adelaide has played a part in this movement through its sister city relationship with Himeji.
There are also six sister states, six sister ports, 11 sister radio stations, and even sister schools.
As early as 1976, we saw the establishment of the Australia-Japan Foundation, with the aim of enhancing Japanese perceptions of Australia. One of the Foundation's most successful initiatives has been the production of general introductory education material on Australia for Japanese junior high-schools.
Indeed Australia is the only country to have produced school curriculum materials approved by the Japanese Ministry of Education.
Despite all of this there is still more we can do to know and understand each other a little better.
As a sign of the importance we attach to the Australia-Japan relationship, the Prime Minister, Mr Howard, advised Prime Minister Koizumi on 16 July that Australia would participate in the Aichi Expo in 2005, which has the theme 'Nature's Wisdom.'
Work is already underway in my Department to prepare an exciting Australian pavilion to showcase our country to the 15 million people expected to attend the event.
The pavilion will project an image of Australia as a culturally diverse and harmonious nation, technologically sophisticated with a dynamic, forward looking economy.
It will increase awareness of Australia as a travel destination and promote bilateral trade and investment...
...raise our profile as a provider of education services...
...and underline Australia's credentials and commitment in the area of environmental care and sustainable development.
Through the exhibits, multi-media and activities, Australia will be presented as a country of the future, with progressive ideas and energy. Australia's pavilion will be supported by programs in the areas of business and investment development, arts and entertainment, and media and public relations.
We are also looking ahead to the 30th anniversary of the Basic Treaty of Friendship and Cooperation between Japan and Australia in 2006. Our two countries have agreed to conduct a number of exchange programs to mark this important milestone in the bilateral relationship.
Such exchanges will help ensure that future generations of Australians and Japanese continue to share the same understanding of each that current and past generations have enjoyed.
Conclusion
I referred earlier to the role Australia-Japan Societies and your Japanese equivalents play in ensuring this occurs.
The fact that today there are some 17 Australia-Japan and 45 Japan-Australia societies is a great testament to the level of grass-roots interest among the peoples of both countries in the relationship.
I also welcome your own recent efforts to come together as a national movement of Australia-Japan societies.
Together I am sure we can continue to sustain a relationship in which we share not only common interests, but a deep understanding.
Thank you.