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MINISTER FOR FOREIGN AFFAIRS  HON STEPHEN SMITH, MP



TRANSCRIPTION: PROOF COPY E & OE

DATE:   30 January 2008

TITLE: Doorstop - Embassy of Australia, Washington DC



STEPHEN SMITH: Well, thanks very much for turning up. I’ve yesterday and today had a  series of important, but valuable and productive meetings with the United States  Administration. Of course with my counterpart, Condoleezza Rice, the Secretary of State; I’ve  also had meetings with Vice President Cheney, Defense Secretary Gates, and a range of other  officials, and this afternoon I’ll be meeting with a range of Congressional representatives  from both the Democrat side and the Republican side. And last night, of course, I had the  pleasure of going to the State of the Union, which I enjoyed very much.

They’ve been good and productive conversations with the Administration. The purpose of the  visit was to come here early, to underline the point, which I did yesterday, that the alliance  between the United States and Australia is fundamental to our foreign relations. As I  described it yesterday, it’s served us well for over 50 years. It transcends governments in  Australia and administrations in the United States. It’s supported by the broad spectrum, both  here and in Australia, and that analysis is shared by the Administration. And whatever issues  we might have are dealt with in that context.

From my perspective, it’s been an enjoyable and a productive visit so far, and I’m happy to  respond to your questions.

REPORTER: In your discussions with Secretary of State Rice and other US officials, did  you talk about the timing of a possible Rudd visit? And can you give us some idea of when,  and if, that visit might take place?

STEPHEN SMITH: Well, the precise dates are a matter for the Prime Minister to advise, but  I’ve been indicating - not in every meeting, but when it’s arisen - that the Prime Minister  fully intends to come to the United States in the course of the next few months. The Prime

Minister would want that to be sooner rather than later, but the precise timetable would be a  matter for him to announce in due course.

But I’m obviously here. The Minister for Trade, Simon Crean, is coming shortly. I understand  also that my Defence colleague, Mr Fitzgibbon is due in the near future as well, so that  reflects the importance of the relationship, and the importance of the issues that we’re dealing

with.

REPORTER: With the Fitzgibbon visit, just to follow up, when approximately might…



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STEPHEN SMITH: I’m sorry, I don’t carry the details in my head. Again, a matter for Mr  Fitzgibbon, but I know he fully intends to come sooner rather than later.

REPORTER: Minister, can you explain, what exactly were Vice President Dick Cheney and  the Defense Secretary Robert Gates asking from you? Were they asking for specific details  about how this withdrawal of combat troops might be managed, and how many people you  envisage sending in the aid and humanitarian sort of sphere?

STEPHEN SMITH: Well, they weren’t actually asking for anything. They knew, because it  had been a longstanding commitment that we proposed to withdraw the Overwatch Battle  Group. We advised them that we would do that at the end of the current rotation.

That of course had already been the subject of conversation between the two governments.  The decision is well understood by the United States, and we’ve always made it clear that we  would withdraw those troops in a manner which caused minimal disruption, and was done in  cooperation with both the United States and the United Kingdom.

REPORTER: So were they offering any suggestions - you know, you talk about minimal  disruption and in consultation - so did they say …

STEPHEN SMITH: No, they understood the decision and they were happy with the  arrangements.

REPORTER: So they don’t want you to alter your plans - not just alter your plans to  withdraw, but I’m talking about the minutiae of how that might be carried out, or where you  might send some additional help …

STEPHEN SMITH: No, in terms of - I just generally, as I did publicly, indicated that we’re  withdrawing those troops, those combat troops, from Iraq. We do think it’s important to  contemplate what other measures we can do in different areas, and we’re looking at further

aid assistance, assistance in training, in building the capacity of the Afghani government, in  governance issues. It’s appropriate for us to contemplate those, and we are.

REPORTER: What are the conditions for say an increase of aid or infrastructure aid,  engineers, or whatever, what are the conditions in which you would contemplate those?

STEPHEN SMITH: Well, we’re giving consideration to those, and when we come to a  conclusion, we’ll…

REPORTER: But are there trigger points? Like you know, we get a super envoy appointed  or you know, is that something that…

STEPHEN SMITH: Well, we’re giving consideration to those issues, and we’ll deal with  them in an orderly way.



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REPORTER: When you say that sort of assistance, I mean, what sort of, what are you  talking about, what type of people? Would they be non-combat military army engineers who  are being sent, or are you talking about…

STEPHEN SMITH: Well, certainly no combat role. We’re looking at the array of  humanitarian aid, governance issues, infrastructure, the capacity-building aspects of a nation-state.

REPORTER: And who would provide the security for those workers?

STEPHEN SMITH: Well, as I said, these things are all under consideration.

REPORTER: You said they understood our position about withdrawing combat troops.  Were they happy about it?

STEPHEN SMITH: Well, because our decision was of long standing, was an election  commitment, they understood that we were proposing to implement it. The implementation of  the decision had previously been the subject of conversation between the two governments.  They were entirely understanding of it, and because we had done it in a way which does cause  minimal disruption - we’re effecting it at the end of the technical term, the end of a current  rotation - the thing’s being taken as read, so to speak. So, it’s not a matter of happiness or  unhappiness, it’s the decision of the Australian Government. It was no surprise, given it was a  longstanding commitment. It’s been taken effectively in stride, and that’s certainly how we’ve  taken it, and it hasn’t in any way disturbed the basis or the nature of the good relationship  between the current Administration and the new Government.

REPORTER: Have you had the opportunity to meet the President informally at all over the  last 24 hours?

STEPHEN SMITH: No. The closest I got was the Vice President’s office.

REPORTER: What about on the issue of climate change? I know the President in his State  of the Union address said he was moving towards an international agreement with major  economies on board. Do you get the sense that the United States is going to commit to a  specific hard target?

STEPHEN SMITH: Well, climate change of course came up in conversations, particularly  with the Secretary of State. And the Major Economies Meeting is occurring in Hawaii, if not  today, then in the next couple of days. Minister Wong will of course be attending there. I  made it clear that we were looking forward to cooperating with the United States government,  as we were with other nation-states, to progress the climate change challenge, in the aftermath  of the Bali conference, and Minister Wong has made it clear that she sees dealing with both  the developed economies and the developing economies as being very important.

Everyone understands there’s a great challenge with climate change. Everyone I think  understands that the dangers of doing nothing far outweigh whatever difficulties might be  caused by implementing some of the climate change arrangements that were contemplated at



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Bali. But they’ll be progressed in a cooperative way, in an orderly way, and there’s no  difficulty in having conversations with the United States government about these matters.

REPORTER: In your discussion on Afghanistan with Defense Secretary Gates, and I assume  with Ms Rice, did you get down to specifics as far as additional commitments that we might  be going to make, and the timing of those commitments?

STEPHEN SMITH: No, I made the point firstly that we do see in Afghanistan the need to  also contemplate those non-military or non-combat contributions, again whether it’s aid,  infrastructure, training, the building of capacity, the building of the capacity for governance. I  think those things are important. What I’ve also done is stress what I regard as the need for an  enhanced international commitment to Afghanistan, both on the security side, and on the  donor side or the humanitarian side, or the infrastructure side, or the building of capacity for  Afghanistan to govern itself as a nation-state.

REPORTER: Even in general terms, did you indicate what we might be prepared to do  additionally, on the security side?

STEPHEN SMITH: No, just that we were giving - on the security side, our contribution is  there. It’s about 1,000 troops. On the other side, I just indicated that we were giving  contemplation to those matters.

In terms of timing, there is one important timing point, and that’s this: The NATO conference  to consider these matters is occurring in Bucharest in, from memory, early April, and I do  regard that as a significant meeting. I do regard that as a significant opportunity for the  international community, not just NATO, to contemplate the sort of commitments that I think  are important.

REPORTER: Sorry, just to follow up: Just on top of that Afghanistan question, I mean, as  we pull back our deployment in Iraq, is there any suggestion that we might increase that 1,000  force that we have in Afghanistan?

STEPHEN SMITH: No, there’s no…

REPORTER: Has that been ruled out back in Australia?

STEPHEN SMITH: Well there’s no current suggestion that we increase our commitment.  It’s a substantial commitment of 1,000, and what we are giving consideration to, is the other  civilian or humanitarian or aid or infrastructure commitments that we believe are appropriate.  The solution to the difficulties in Afghanistan can’t be restricted to a military or a security  solution. They have to include those wider elements that I’ve referred to.

REPORTER: Minister, the previous government had had discussions with the American  administration about being part of research on a new generation of nuclear reactors, and also  had expressed some enthusiasm to the Indian Civil Nuclear Agreement. Did you have any  discussions about that, and can you outline for us what the government’s position is on the  civil nuclear agreement?



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STEPHEN SMITH: Well, the US-India Civil Nuclear Agreement was raised in the course of  discussions, just as it was raised in the course of discussions that I had with the Indian Prime  Ministerial envoy in Perth shortly before I left for the United States, and I gave the same  response, which is, we’ve made it clear that we won’t be exporting uranium to India. We’ve  had a longstanding policy commitment of not exporting uranium to non-nuclear proliferation  countries, and I’ve indicated that to the Indian Prime Ministerial envoy, as I have to the  United States Administration. So far as the Indian-US Civil Nuclear deal is concerned, I’ve  indicated that we’re prepared to give consideration to that, but there is a fair bit of water to go  under the bridge, before Australia needs to make a decision on that matter, either within the  board of governors of the International Atomic Energy Agency, or the Nuclear Suppliers  Group. There are issues that need to be resolved in India by the Indian parliament and the  Indian government. So there’s plenty of time to give orderly consideration to that, and I’ve  indicated that we will, and in due course will make a decision if we’re required to.

REPORTER: And on the other issue that Mr Howard had expressed some interest in  working with America on this new generation of nuclear…

STEPHEN SMITH: That issue was not raised in the course of conversation.

REPORTER: Excuse me, can I just clarify? So, you would potentially reverse that policy of  exporting uranium under the auspices of the new agreement, the US-India…

STEPHEN SMITH: No, there are two separate issues. The first issue is the exporting of  Australian uranium to India, which the previous government had said they would authorise  and allow. That will not occur under the new government, because we have a long-standing  commitment to not allow the exportation of uranium, Australian uranium, to nations who are  not party to the Nuclear Non-Proliferation Treaty.

A separate issue from that is the United States-India Civil Nuclear arrangement, which as I  say, still has matters to proceed or progress before, as I understand it, the Indian parliament  and the Indian government. And I’m happy to stand corrected if I’m wrong, but I think I think  that if it proceeds through the Indian parliament, it is also subject to Congressional approval  here. If all of those things occur, then the matter may well fall for consideration before the  International Atomic Energy Agency for approval, and the Nuclear Suppliers Group for  approval, in which Australia has a role and an interest. That’s a separate matter, which I’ve  said we are prepared to give consideration to, and will do that in an orderly way if we’re  required to.

REPORTER: Can I just ask, there was some criticism of your comments before an  international - before the US investment community in the US last week, where you were  talking down Australia’s infrastructure. Do you think it was appropriate to make those  comments?

STEPHEN SMITH: Well, firstly, I’ve seen one criticism by one journalist, and the criticism  was based entirely on a wrong premise and wrong analysis. It was at a…



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REPORTER: There were comments by people after that…

STEPHEN SMITH: None to me, and none that I’ve seen attributed to anyone in person. The  comments I made were unsurprising and unremarkable. The comments I made were as  follows: that Australia has been a prosperous nation as a result of a couple of things. Firstly,  being an attractive place for capital investment. Originally, historically, overseas capital  investment - but now overseas capital investment and also domestic capital investment,

courtesy of superannuation funds. And secondly, being a great trading nation. And I said that  Australia remained a very attractive place for investment.

One of the economic issues and difficulties that we have in Australia, which would be no  surprise to anyone contemplating investing in Australia, was inflation getting too high, and I  outlined the steps that we were taking to get inflation under control, and also outlined the  reasons why that had occurred: long-term complacency and neglect by the previous  government on things which were leading to capacity constraints, either in skills or in  infrastructure.

All of those things were previously on the public record - either by the Treasurer of the  Commonwealth, or in a non-pejorative political way, over the last 10 years, by the Reserve  Bank of Australia. It was actually making the point: we acknowledge there is an inflationary  problem in Australia, and we are taking steps to address it. I would have thought anyone who  wanted to invest in Australia would prefer to operate in a low-inflation regime than a high-inflation regime. I would have thought to any investor it would be more attractive to know  that the government of the day was on the case in trying to keep inflation down, and that  would be more attractive for investment than a government, as we’ve seen in the past, who  wasn’t interested in taking the necessary steps to keep inflation under control.

REPORTER: Why highlight the problems, though, Minister, in front of that international  investment community?

STEPHEN SMITH: I highlighted the solution.

REPORTER: Could I ask you a general question about the Middle East? Australia supports,  of course, UN Resolutions 242 and 338, although that commitment I think was honoured in  the breach, under the previous government. Can you see, under this Rudd Labor Government,

a rebalancing of our approach to Middle East matters, so that we adopt a more even-handed  posture, such as that which was adopted under the Whitlam Labor Government after 1972?

STEPHEN SMITH: Well, look, the policy approach of the Labor Party and the Labor  Government is that we believe the solution in the Middle East is by a two-nation solution,  respecting the right of Israel to exist, and respecting the right of a Palestinian nation-state.  That’s an even-handed approach, which the Labor Party has had as its policy for a long period  of time.

REPORTER: But you’d use the phrase even-handed? You don’t demur from the phrase  even-handed?



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STEPHEN SMITH: Well, our policy approach for a long period of time has been to respect  the right of Israel to exist as a nation-state - we support that, as we have for a long period of  time - and to respect the right of a Palestinian nation-state. It’s a two nation-state solution.  That’s even-handed.

END

