Australia, the region and the East Asian Summit: Reluctant partner or agenda setter? Kevin Rudd Perth

We in the Labor Party are pleased that our fearless Foreign Minister Alexander Downer finally came to his senses and realized last week that it really was "now or never" if Australia wanted to be a participant at the inaugural East Asian Summit and through that a member of any future East Asian Economic Community.

The East Asian Summit, due to be held in Kuala Lumpur in December this year, signifies a turning point in the development in East Asian regionalism with the emergence of a forum which may ultimately become a major regional economic institution.

At the heart Australia's role in the region in both security and economic terms is its enduring relationship with Indonesia.

It would come as no surprise that Indonesia is central to Australia's foreign policy outlook.

Our relationship with our Indonesia has never been more important. We are truly fortunate at present to have in Indonesia a President who not only appreciates this fact but who is prepared to lend his personal political support to the cause.

Susilo Bambang Yudhoyono's election as the directly elected President of one of the largest, not to mention newest, democracies in the world testimony to the strength of democracy in Indonesia.

But the fact that the majority of the Indonesian people felt free to choose a candidate that was not from one of the established political parties is the clearest possible indication that the ballot was free and fair, and that democracy is alive and well in Indonesia.

There is no doubt that the Indonesia of today enjoys freedom of the press. In fact the Indonesian press are so free that Australian politicians have been known to become quite alarmed by the ferocity of the Jakarta media scrum.

In addition to the promising signs of emerging democracy in Indonesia, Indonesia's economic performance so far this year is also showing promising signs.

Despite the devastating impact of the tsunami, the economy is on track to achieve economic growth in 2005 of 5.5 to 6 percent this year. Importantly, economic growth is shifting from consumption to investment reflecting renewed confidence by domestic and international investors in Indonesia's longer term prospects.

Inflation has increased to 8.8 percent following the fuel price hike, although Indonesia should benefit from high oil prices as it is a substantial net energy exporter.

Of course major economic policy challenges remain, particularly further reductions in public debt from 50 percent of GDP to a more sustainable 35 to 40 percent, further reform of the financial sector, especially improved governance, and further steps must be taken to address corruption.

Contributing to its improving economic outlook, has been the Indonesian government's attitude towards eliminating terrorism from their shores.

This response to the terrorist challenge has only served to bring our two countries closer together. I would like to again place on the record the Opposition's thanks to the Indonesian government for its excellent response to the two terrorist attacks on Australian interests on Indonesian territory. The quality of the response is due of course in no small part to the leadership of President Susilo in his previous capacity as Coordinating Minister for Political and Security Affairs.

But beyond the police cooperation on the investigations of the Bali and Jakarta Embassy bombing there is much more that can be done to combat the terrorist threat in Indonesia.

In particular, Labor has been calling on the government to develop a hearts and minds strategy to combat the causes of terrorism which would work in parallel with cooperation combating the effects of terrorism such as cooperation on law enforcement, border control and intelligence sharing. Labor argues that Australia should lead an international donor consortium, beyond specific commitments in Aceh, in order to work with our partners in the Indonesian education system to rebuild the Indonesian school system.

Another element in an effective hearts and minds strategy in Indonesia and in South East Asia more broadly should be the rebuilding of Radio Australia. The sorry saga of the destruction of Radio Australia is well known to many Australians, particularly those such as yourselves with an interest in the region.

In short, following the election of the Howard government, they decided to sell the Cox Peninsula transmitters at Darwin. The long-term lease was given to a Christian fundamentalist broadcaster instead of the voice of the Australian government.

The net impact, however, has been that our capacity to get out a "soft message" about what Australia is doing to help ordinary Indonesians has been severely curtailed.

The Australian government, if it had any sense of national responsibility, should act now to recreate and rebuild Menzies' child: that is Radio Australia. Radio Australia began broadcasting in 1939 when Robert Gordon Menzies was Prime Minister. John Winston Howard, who prides himself in being Menzies disciple, is the one who has axed this service to the bone. And it is the long-term Australian national interest which has suffered as a result -- including in our overall long-term engagement of the war against terrorism.

The terrifyingly destructive force of the Tsunami, which killed hundreds of thousands and destroyed the livelihoods of many hundreds of thousands more, also bought with it some positive forces of change. A chance to rebuild not just the bricks and mortar that had been washed away but a chance also to rebuild civil society in Aceh. To its credit the Indonesian government seized the opportunity to restart negotiations on a peace agreement with the Free Aceh Movement (GAM).

On July 17 the government and GAM finally reached a peace agreement which will be formalized at a ceremony in Helsinki next week. It is to be hoped by all people of goodwill that this agreement will bring to an end 30 years of fighting in Aceh that has cost nearly 15,000 lives.

Labor in recent times has on a number of fronts been consistently ahead of the Howard government in setting Australia's foreign policy agenda.

We've done it on Afghanistan. We've done it on the East Asian Summit. We've done it in outlining our proposal for a comprehensive regional counter-terrorism strategy. And we are doing it now in our calls on the government to embrace a similar strategy in response to Avian Influenza.

What Australia needs today is a reassessment of its foreign policy priorities. Gaining membership to the East Asian Summit, albeit at the last minute, is a good start. Australia needs to be an agenda setter in the region. We must demonstrate leadership.

One thing is becoming more certain, when Australia is involved in the region, we will have our friends in Indonesia right beside us. It is a critical relationship for Australia. And it is, I believe, also a critical relationship for Indonesia.

The writer is Australia's shadow minister for foreign affairs, trade and international security. This article was condensed from a speech he delivered to the West Australian chapter of the Australia Indonesia Business Council in Perth recently.