5.    AUSTRALIA

5.1   While Australia and New Zealand broadly share the same strategic environment, Australia does have a different geographical location and this is reflected in its judgement on its strategic priorities. Put simply, New Zealand is an isolated oceanic archipelago whose nearest neighbour, Australia, is benign and like-minded. But Australia itself is a resource rich, empty continent with no particular historical affinity with the much closer and vastly more populous countries of Asia. One of the key reasons to form the Australian commonwealth was to strengthen the ability of the six federating colonies to provide for their common defence and security. In the century since then there has normally been a broad consensus on the importance of national defence in Australia. There is no significant variation in Australia regarding the political approach to national security: bipartisan support for a strong security policy is well entrenched.

5.2   That consensus remains and the events of the past four years - the near miss in the Taiwan Straits in 1996, the Sandline crisis in PNG, the Asian financial crisis, nuclear tests in India and Pakistan, the fall of Soeharto, the bloody birth of East Timor - have given it new vigour, while obliging Australia to review its defence capabilities. In general Australian commentators, both within and without government, see the regional strategic environment as less stable and therefore as less predictable than before. They also see the East Timor experience as demonstrating how quickly Australia's apparently impressive defence resources could become over committed. In the 1980s Australia had a defence force of 70,000 plus and spent 3.0% of its GDP on defence. In 1999 the defence force is just over 50,000 and Australia spends 1.8% of GDP on defence. The East Timor deployment has engaged three of the Australian Defence Force's (ADF's) four infantry battalions.

5.3   The US alliance remains fundamental to Australia's national security policy. Australia sees the alliance as a security multiplier for two main reasons: the deterrent effect of the link with the US and the preferential access to high capability equipment, technology, intelligence and logistic support that it delivers. Both are seen as giving Australia a strategic edge in the region. Although some Australians were frustrated in August 1999 at the time it took the US system to focus on East Timor and determine how it would assist, that experience has not resulted in any diminution of political support for the alliance. Rather it has made Australia more conscious of the need to increase its readily deployable assets and to ensure that they are independently sustainable to meet regional contingencies. Australia does not regard what others may see as the costs of the US link - for instance the fact that it hosts US facilities, or that it is identified closely with the US in some Asian eyes - as outweighing these benefits.

5.4   Australia invests considerable resources in its relations with Asia, bilaterally and multilaterally. Japan, China and South Korea are all major trading partners of Australia. Australia is fully involved in APEC and in the ARF and has promoted a number of regional arms control initiatives. Australia remains firmly opposed, for both security and arms control reasons, to any proliferation of weapons of mass destruction in the region. Australia has extensive economic links with the region and is engaged with New Zealand on discussions about linking CER and the ASEAN Free Trade Area. Radio Australia and the Australia television networks are respected in the region for their coverage of international affairs. Australian newspapers carry extensive reporting of Asian affairs, often from their own staffs. Australia hosts significant numbers of Asian immigrants, students and visitors.

5.5   Australia is concerned about the changing balance of power in Asia, and particularly worried about tension between China and the US over Taiwan. There has already been media and academic commentary in Australia speculating that the US would expect Australia to be alongside in any confrontation with China over Taiwan.

5.6   Australia plays close attention to other factors which might alter the regional balance of power: the possible emergence of India; the limitations of ASEAN. Australia is faced on its northern perimeter with weak, possibly even disintegrating states. This presents a number of concerns - illegal migration, secessionist pressures in eg West Papua, disruption to sea lanes. Australia will have a continuing commitment to East Timor.

5.7   Australia has important commercial interests in PNG, and there are approximately 10,000 Australians resident there. The natural tension between a former colony and its former colonial power is aggravated by proximity: the porous border with PNG sees significant smuggling in drugs, firearms and other goods. Australia provides the bulk of PNG's ODA and has provided additional financial support in the current financial crisis. Australia strongly favours maintenance of the territorial integrity of PNG.

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