Doorstop interview, Manila

November 19, 2015



Can say I have been pleased to have really good discussions here, both in the general meetings and in the bilaterals and one-on-ones. The commitment to strong economic growth in the region is very, very real.

The enthusiasm with which the TPP has been received and discussed is very encouraging and of course you have seen here in Manila the enthusiasm of other countries, the Philippines in particular of course and Indonesia, to join the TPP is also very encouraging.

What all that means is that leaders in our region understand that the way to ensure strong job growth, to ensure strong economic growth, to ensure success and prosperity for their peoples is to have open markets and free trade. That is the key.

Everybody understands here, frankly, just as they did at the G20, there is a real recognition that the pace of change in the global economy has never been as rapid as it is today. That we live in a time where there is real disruption in terms of the established economic order and that requires economies to be flexible,  agile and dynamic and that, of course, requires freedom. It requires exactly the economic values that Australia is committed to, which is open markets and free trade.

So we have had some very good discussions and it has been -  I have to pay again my highest compliments to the Philippine President and his Government for the work they have done in managing APEC 2015.  On a closer to home note, I want to acknowledge the great work done by our Ambassador to the Philippines and his team and the whole APEC - Australian APEC - team in ensuring that we have a very good and constructive engagement here in Manila.


On the question of freedom, Prime Minister, freedom of navigation in the South China Sea, China relations generally. Were you taken aback by President Obama's decision to raise the leasing of the Darwin port and are you satisfied that flogging those sort of assets to state-owned enterprises won't affect naval operations in any way?


Let me go back to - I will answer it chronologically.

The fact that the Darwin port was being privatised was not a secret. It was announced publicly early last year. It was very, very well known. The fact that Chinese investors were interested in investing in infrastructure in Australia is also hardly a secret.

The Northern Territory Parliament conducted an inquiry. They have had a committee that looked into it earlier this year and it reported, I believe, in April and recommended that the Government - the Northern Territory Government, that is, consult, although it had no legal obligation to do so, with FIRB and with the Australian Defence Department.

So, it was very well known that the port was being privatised and it would be very well known to anyone who thought about it for very long that there would be Chinese interest in it, and indeed no doubt interest from other parties as well. 

The Defence Department was consulted about it. Our Defence Department was, and they came - their conclusion was that there were no - they did not have any concerns about it for at least a couple of reasons I can share with you.

One was that the port that was being privatised was a commercial port only. It didn't affect the facilities available to the Australian Defence Forces and finally, the other point is that under our legislation, under our law in Australia, the Department of Defence or this Federal Government can step in and take control of infrastructure like this in circumstances where it's deemed necessary for purposes of defence.

So, all I can say is that that's been looked at carefully. I've discussed it again, following the press reports, with the Secretary of Defence, Dennis Richardson, and of course, I've been in touch with the Minister as well and I'm satisfied that those concerns, the concerns about defence issues or related issues were fully dealt with by our security agencies and by, of course, our Defence Department themselves.


The issue of letting the Americans know, was it assumed that it was so well known they didn't need to be officially informed?


All I can say is that when it was first raised with me, not by President Obama but by some other American officials some weeks ago - it was put to me that the first thing they had read about it was in The Wall Street Journal. And my observation was only, of course – only seeking to encourage the circulation of great Australian newspapers - I suggested that they should invest in a subscription to the Northern Territory News, because it was not a secret. I think it's important to support metropolitan newspapers right around Australia and especially in Darwin.




That’s right. You can keep up to speed and indeed the President and I talked, he recalled with great affection when we discussed the importance of subscribing to the NT News. I suspect they'll probably give him a free one now that I've mentioned it.

But, he remembered with great affection his appearance on the front page of the NT News with crocodile insurance. I did say to him even the US president would struggle to get on the front page of the NT News without a crocodile angle. You know it is a very important part of their coverage.


The decision today, that Scott Morrison announced on the Kidman sale, are you anticipating any backlash from China on that?


Well, look, Scott's explained - it's his decision of course as you know - but he's explained the decision well. It's a huge piece of Australia, these Kidman properties being sold in one line and a large part of the acreage is in the Woomera Prohibited Area, which of course is used for weapons testing and so there are national security issues involved.

I noticed you asked me about backlash from the Chinese Government. You would be wrong to assume that there was only one foreign country associated with the buyers. So there's no issue of discrimination here.

But plainly, the Woomera Prohibited Area is called the prohibited area for a reason. It is actively used for weapons testing and trials and it's an area that obviously raises national security issues. I think what Scott has said in his statement, which I'm sure the owners will read carefully, is that there's nothing to stop them to recalibrate or restructure the way in which they are selling these assets and resubmit. So no doubt they will reflect on that.


Prime Minister, the AFP is looking into Mal Brough and the Ashby affair, do you have confidence in Mr Brough? Should he step aside while the AFP look at that affair?


Mr Brough has stated, and I've got no reason to doubt him, that the material that they have received is the same as has been already made public, so there is nothing new in that. There is an ongoing inquiry there and the answer is yes, I do have confidence in Mr Brough, but, of course, there are rules relating to ministers and cabinet ministers, but there is, at this stage there is nothing to suggest that Mr Brough should stand aside or do anything of that kind.

Naturally he is providing complete cooperation with the investigation, as he should.


The British are going to be replacing their coal-fired power stations with gas by 2025. Ahead of the Paris talks in a couple of weeks, is that the sort of progress you'd like to see with Australian emissions, given the amount of pollution that comes out of Yallourn and Loy Yang and Hazelwood et cetera?


Well, the critical thing of course is your net emissions. Let me just take the opportunity to be clear about what I've said about coal. I was asked some time ago whether I supported a unilateral ban on Australia exporting coal, and I made the pretty obvious point that if Australia were suddenly to stop exporting coal that would be a bonanza for our competitors - Indonesia, Columbia and others - who of course would then export more coal.

Coal is going to be a big part of the world's energy mix for a long time, for many decades. I met with, in Antalya,  Fatih Birol who is the director of the International Energy Agency and that's their latest estimate. Their world energy report is the last word on the subject. I have no reason to doubt them.

The critical thing is, however, what are the world's net emissions and, of course, there are a range of answers. In some markets it may be sensible to continue burning coal for a very long time, perhaps forever, as long as those emissions are offset in other jurisdictions.

You've got to remember, a tonne of CO2, or a tonne of methane, or any other greenhouse gas, has the same effect on the atmosphere and on global warming regardless of where it's emitted. So the critical thing is getting the net outcome right.

There is a move to gas, globally.


We have masses of that.


We do have lots of gas and we're exporting it. We expect to be the world's largest exporter of LNG by 2020. It is a cleaner fuel in every respect and, of course, is particularly attractive in many Asian markets which are grappling with really terrible urban pollution because it doesn't have the same particulate content that burning coal does.

So the answer is, I think, generally that the response to, each country will meet its emissions reductions in its own way. No-one's suggesting that there is one size fits all.

We are taking very credible and reasonable emissions reduction targets to Paris. We have set in place, and I give Greg Hunt full credit for this, Greg has set in place a series of measures which will enable us to meet that reduction in emissions, which I have to tell you, in terms of emissions reductions per capita which is probably the best way to look at it, is the second highest, second only to Brazil, out of all the targets that have been proposed so far. So it is a substantial effort.

So Greg has the measures in place to do that and we are going to review our measures in 2017 and, of course, if for whatever reason they're not tracking in the right direction, then we can adjust them. We always have the option of buying international credits, so there are many ways we can meet those emission reduction targets.

Will there be over time a move from higher emissions energy generation technologies to lower emission ones? Yes, that's clearly happening.  But the pace of when it happens, the rate of it happening and where it happens is going to be determined by sensible economic considerations. What is the least cost means of cutting your emissions? That's what countries will be looking at.

Because the goal, as I keep on reminding the Labor Party about in the House, you shouldn't confuse the means with the end - the end is cutting your emissions. The end is cutting your emissions. There are many means of doing that and what's appropriate in one place will not be appropriate in another, but as long as you're meeting those targets, that's good. That's what you need to do. There's no need to lock into one particular mechanism.


Bill Shorten this morning has described President Assad as a ‘butcher’. Is that how you would classify him and is that why he has to be removed?


Well, he's killed, he's been responsible for killing many many thousands of his citizens, so many people have described him as a butcher. I think he has been a murderous tyrant, there is no doubt about that.


Can I ask about MPs' travel entitlements?




There were reports today that the family reunion benefit could be scrapped as part of the review. Do you think that entitlement is in line with community expectations?


Look, I'm waiting on the report of the review, but I think... let's wait to see what the review recommends. I think that's probably the best thing to do. We might get back to APEC, but that's a good segue.


Prime Minister, there’s a lot of concern in Asian countries about the spread of terrorism here. Most of them only contribute military aid, rather than personnel, should there be more personnel [inaudible] to fight against ISIS from these countries?


You're asking me whether the Philippines should be contributing military assets, planes and troops and so forth, is that what you're asking me?




I think each country's got to assess what is appropriate and what it has the capacity to do, what will be effective. The goal here is to defeat, or degrade and defeat, Daesh or ISIL and there are a range, there are military measures which we are undertaking and people, Australians in particular should not forget that we are making the second largest military contribution in that theatre after the United States. But there is also, of course, the political dimension and that is why you've seen the agreement or consensus arising out of the Vienna meeting to endeavour - I'm not suggesting this is by any means assured - but to endeavour to reach a political settlement.

I might say I read somewhere that someone had suggested that a political settlement would mean that Daesh would be at the table, ISIL would be at the table. Nobody is suggesting that, least of all me. Daesh or the so-called Islamic State seeks to establish its own caliphate. It has no interest in any political settlement and I'm not aware of anyone having any interest in raising it with them.

The key to a political settlement in Syria is finding a mechanism where the aggrieved Sunni majority of that country can feel included... not 'feel', but be included in a new government which shares power between the various groups. If that can be achieved, and again I stress the road to that is far from straightforward and that is a very difficult task, but were that to be achieved then, of course, Daesh loses its fundamental base.

You've got to remember that we look at it, naturally, very much in the way it attracts foreign fighters, some from Australia and from other countries, including countries in the region. But Daesh's fundamental constituency, its foundation in that part of the world sits on the grievances of Sunnis who were oppressed by Assad in Syria and felt left out and oppressed by the government in Iraq , which was, Iraq being a majority Shia country.

So the inclusion of the Sunnis, this is the people and their leaders, their often tribal leaders, in a settlement is a key part. Because that takes away the foundation, the constituency that Daesh has been preying on and that's the focus.

Again, I'm not saying this is going to be particularly straightforward at all, but that's clearly, that's the political objective that people are talking about.


[inaudible] if Assad is there even for a short period of time in an interim role?


You've asked about the future of Assad and that's a very good question. The calculation is this - obviously there's very deep enmities, as I said the other day, towards Assad and his regime by many people, perhaps most people in Syria. It's hard to tell.

There's obviously deep enmities towards him by other players in the Middle East, the Sunni majority States. His supporters are, of course, Iran and Russia.

The reality, however, is that the approach has to be a pragmatic one and whatever combination of players that are able to achieve the settlement, and that includes groups inside Syria - with the exception of Daesh who as I say, have no interest in any settlement and no-one has any interest in a settlement with them - but there is going to be a need to be very pragmatic about it.

If you look at the other countries that are close to the scene, that is certainly what neighbouring countries are talking about now, a more pragmatic approach. I think David Cameron spoke for the room in Antalya when he said the negotiations have to be approached in a spirit of pragmatism and compromise. 

Because the fundamental problem is there is a war going on there which is killing, that has killed hundreds of thousands of people, it is still killing thousands of people and there are four million plus refugees, 2.5 million of them, or thereabouts, in Turkey alone. So, this is a humanitarian catastrophe of extraordinary scale. It's said to be the worst since the Second World War and I have no reason to doubt that, so a resolution is absolutely critical.

Just one more.


You are heading into the leaders' summit obviously at APEC. I gather leaders are making various contributions. What contributions will you make?


In terms of my...?




Our commitment is very much along the lines of what I said at the outset. Open markets, free trade, innovation, ensuring that our economies have the agility and flexibility to respond to a changing global environment. To recognise, as I said yesterday, that when we commit to freer trade, the TTP for example, that is a triumph of optimism over fear.

It is when - countries do that when they say, ‘Yes, if we open our markets up there will be more competition, but you know something it's a great big world out there and there are also more opportunities’. That is the challenge. If you try to close your doors and pull the doona over your head as it were, you'll be left behind.

So the opportunities, the future lies in a positive, optimistic approach to the big opportunities out there and that requires us to be able to deal with them, recognising we can't predict what they will all be.

Many if not most of the jobs 30, 40 years from now don't even exist today. We are living in a dynamic time of change and what that requires is agility and an ability to adjust and that requires freedom, open markets and free trade and that's what I talk about here. It's manifestly in Australia's interest, but it's also I believe in the region's interest.

Now on that note, I've got to go. Thanks very much, guys.



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