Institute for Regional Security keynote, National Gallery of Australia, Canberra

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Thank you Lavina for that warm introduction. There are so many special guests here but I would like to acknowledge a couple. Ambassador Culvahouse, Ambassador Takahashi, Secretaries, Chief of the Defence Force, Agency Heads, Ministerial and Parliamentary colleagues and colleagues of mine I have noticed here from so many aspects of my life. It is a great pleasure to be able to speak to you tonight.

Let me begin by acknowledging the traditional custodians of the land on which we meet – the Ngunnawal People – and pay my respects to their elders past, present and emerging. As Minister for Defence, I also pay my respects to the Aboriginal and Torres Strait Islander men and women who have contributed to the defence of Australia in times of war and peace. My sincere thanks to Peter Nicholson and the Institute for Regional Security for hosting this evening’s dialogue.

Today, debate and the power of ideas, are more important than ever. The focus tonight, The Struggle for Power and Influence in the Indo-Pacific, could not be more timely. And the institute couldn’t be better placed, to stimulate the debate and ideas that this theme invites.

Tonight I will address three things. Firstly, how I see the application of power.  Secondly, how I see the challenges that confront us. And lastly what Australia is doing to respond. Firstly, the Struggle for Power. I’ve spent most of my professional life in the military and in politics, so it’s no surprise that I have given some thought to the nature of power and how it is exercised.

Politics is everywhere, at all levels of society and organisations, and it is essentially about power – how it’s distributed, managed and exercised who holds the power, who seeks it, how it’s controlled and how it’s used. Politics and power impact on all aspects of our lives – family, community, business, parliaments, bureaucracies and armed forces. Democracy is a system designed to control and moderate power and to redistribute it from the few to the many. As Winston Churchill said “no-one pretends that democracy is perfect or all-wise." But it is a system that has enabled peace and freedom, and has demonstrably contributed to global security and prosperity. It is these two things we’ve come to expect – security and prosperity – that are being tested by the profound and rapid change occurring in our region.

While politics and power are deeply embedded in human behaviours, away from forums like tonight, Australians are not really comfortable talking about power and its reach. Discussion around the harder edges of power, the application of kinetic military power, lethality, are an anathema to our egalitarian sense of self. As Minister for Defence I sit at a fulcrum - where power and politics intersect. In a rapidly changing geostrategic environment, globally and in our region.

The stark fact is we are living in the most significant period of geostrategic transition in our region since the Second World War. Globalisation has brought great benefits and opportunities to the Indo-Pacific. It has brought extraordinary economic growth and unprecedented social change. Millions of people across the Indo-Pacific have been lifted out of poverty and can now expect to lead lives that their grandparents could only dream of. Southeast Asian economies together – equate to the world’s fifth-largest economy, projected to be fourth by 2030. Thailand, Malaysia and the Philippines will make the top 25 by 2030. Indonesia is expected to become the world’s fourth-largest economy by 2050, surpassing Japan and Germany. Australia too has benefited enormously from decades of economic growth and stability. We have just chalked up our 28th consecutive year of economic growth – a record unmatched by any other developed economy.

Indeed, since 1991 the size of our national economy has grown two and a half times larger - from $780 billion to $1.8 trillion in real terms. This is an enormous achievement, it did not just happen and cannot be taken for granted. This growth and prosperity would not have been possible in the absence of a United States led rules-based order. An order built on the recognition of sovereign rights, freedom, and the fundamental principle that all nations are entitled to conduct their affairs without force or coercion. An order in which we have felt secure and comfortable for decades.

And in hindsight, one that has made us somewhat complacent in assuming that all nations share the same commitment.

This order is now under challenge on many fronts. The result is a world, an Indo-Pacific, which is dynamic, evolving. Still full of opportunity, but also increasingly contested. In short, our region is feeling anxious about its future. In this environment we have to accept we can’t turn back the clock. But as our region evolves, we have to ensure the norms and principles that underpinned our prosperity and security are not lost. How we respond to this new security environment will determine our future and, more importantly, the future we bequeath to the next generation. 

What we do now, the relationships we build, the decisions we make and the values we embody as we undertake our work, will all have a profound impact on the well-being of all Australians and also the larger community of nations across the Indo-Pacific. To achieve this we need a new approach. To my mind this approach has three key parts. Firstly, we need to better understand Australia’s national power, hard and soft, traditional and new, and how its best harnessed for our national interest. Secondly, we need to work with our regional partners to shape the character of the international order. And thirdly, we need to be able to anticipate, adapt and respond to the challenges we face.

So our first challenge is to lean in and apply all arms of the Australian Government’s national power to help shape the sort of region that we want. We want a region that is secure, open, inclusive, prosperous and resilient. A region where disputes are resolved peacefully according to international law and without the threat or use of force or coercion. Where open markets facilitate flows of goods, services, capital and ideas. Where rights of freedom of navigation and overflight are upheld, and the rights of small states are respected. Where international law, rules and norms are applied. And where regional and global architecture and institutions maintain a central role and help set the rules and norms for behaviour in the region. Our success in influencing this will depend on our diplomatic, economic, and military levers of national power being well coordinated. Military force is crucial. But it is a tool of last resort, and diplomacy must always be our first line of defence.

As Minister for Defence, my challenge is to ensure that the Australian Defence Force can support Government responses to a rapidly widening range of contingencies and threats. Those that are explicitly stated in the White Paper and those that are emerging. There are now new challenges - grey-zone tactics and hybrid warfare by state and non-state actors, threats to and from space, threats in the cyber domain

hypersonic vehicles, more capable missiles. There is also the emergence of new technologies, the digital transformation of every aspect of our lives and economies,

and the increasing modernisation and integration of infrastructure within and across national borders. All of these influences heighten our security challenges and make our region a more complex place. And we must remain vigilant to the ongoing threats of terrorism, transnational crime, people smuggling, political and economic corruption, and challenges to the legitimacy of state and economic institutions.

These challenges operate simultaneously in a dynamic, unpredictable mix. At any point they can compound and cascade, creating challenges of much greater strategic significance than any single problem on its own. The challenges are multifaceted, multidimensional and require a whole of nation response. We need to find new ways of working more closely together with partners and inside and outside Government. But we also need to use our strong network of international relationships to reinforce the rules based order. This is the second aspect of our approach. Australia’s interests and offerings are diverse and rich. This gives us a unique perspective on the struggle for power and influence that is shaping the international order. We seek genuine partnerships in pursuit of shared interests; and when we disagree, we are respectful and engaged. We cannot afford to allow geography or history to limit our strategic engagements. We need to strengthen our relationships with traditional partners, and build new ties with states that share our values.

So what are we doing to this end? The US alliance is fundamental to security. The Australia-US alliance remains the cornerstone of Australian security, and a major force for stability and security in our region. The alliance is a powerful statement, and demonstration, of mutual commitment and shared values that underpin an enduring friendship. It is an essential part of the fabric of security arrangements across the Indo-Pacific in which Australia plays an active role. It is in Australia’s interests for the United States to continue to be a strong and active participant in the security and economic development of the Indo-Pacific. Australia will continue to broaden and deepen our alliance cooperation, and support the strongest possible security and economic engagement by the United States in this region. The defining strategic relationship for the Indo-Pacific is the US-China relationship. We should expect this relationship to become more competitive in both economic and military domains. There are already robust conversations across a range of policy areas. But it is in no-one’s interest to see this relationship become adversarial.

What is important is that the robust conversations continue, and that serious efforts are made to manage strategic tension. Australia’s relationship with China is becoming more complex and engages the full range of our national interests. China is, and will remain, an important partner for Australia. But our interests will not always align.

There are activities China has pursued that we believe are counter-productive to maintaining strategic stability across the Indo-Pacific. 

We will continue to encourage China to exercise its increasing influence in ways that enhance stability, reinforce international law and respect the interests of smaller states and their right to pursue those interests peacefully.  

Of course, the US and China are not the only powers in our region.

In North Asia the Japan relationship is broadening and becoming more important strategically. Japan has substantial economic reach across the region, and is developing new capabilities. We regard our partnership with Japan as our closest and most mature defence relationship in Asia. We are two Indo-Pacific democracies that approach the exercise of regional power and influence in very similar ways – by working with partners. And another important partner for Australia is the Republic of Korea. Denuclearisation of the Korean peninsula is an urgent priority for us. Indeed, nuclear proliferation by North Korea remains the most urgent challenge for our region. And no one feels that urgency more acutely than the Republic of Korea, with whom we work closely to support the security and stability of the Korean Peninsula.

Turning to the Pacific – our Defence partnerships are deep and long-standing.

Forged on the battlefields of World War II our soldiers have fought together, died together and are buried together.  Building on our longstanding ties and shared values, the Government is stepping up defence engagement with our Pacific family. I recently had the opportunity to visit Papua New Guinea and Solomon Islands – my first as Defence Minister – to witness this in action. I saw our forces working side-by-side on exercise and was struck by the two-way transfer of skills, knowledge, friendship and respect. The overwhelming message from my Pacific counterparts was one of pride in their sovereignty, and a determination to set their own priorities and realise their own ambitions. We are ensuring our Defence Cooperation Programs to support these priorities. We will continue to work side-by-side with our Pacific partners to build a region that is strategically secure, economically stable and politically sovereign. This is the approach we take with our Southeast Asia defence relationships too.

Southeast Asia’s proximity to Australia and location at the junction of the Indian and Pacific Oceans means its stability, security and prosperity directly affect our own.

Southeast Asia frames Australia’s northern approaches and our key trade routes flow through it. Australia remains one of the few countries to conduct strategic defence dialogues with all Southeast Asia countries. We listen to regional perspectives and we work together with our partners to respond to regional challenges.

Each year, over a thousand Southeast Asian military officers come to Australia to build closer bonds and mutual understanding through training and study.

We also conduct around 50 bilateral, mini-lateral and multilateral exercises in Southeast Asia annually.  This increased activity means that the ADF is busier than ever – Army now does around 90 international competitions and exercises a year; Navy has on average 20 ships at sea per day and conducts in excess of 200 foreign port visits a year; and Air Force is conducts 53 international exchanges, exercises and dialogues each year. These will continue to grow in sophistication and complexity as the security challenges evolve.  Our strong and productive relationship with Indonesia is critical to providing security in a more dynamic region. Australia and Indonesia have an abiding interest in deepening our cooperation in the areas of maritime security, counter-terrorism, humanitarian assistance and disaster relief, and peacekeeping.

Indian Ocean. As a Western Australian, I am also acutely aware of the geostrategic challenges to our west. The Indian Ocean looms large but, until recently, has been arguably overlooked. It was not until 1987 that Australia adopted a two-Ocean navy policy, prompting a significant shift in how we position our defence assets and how we think about the Indian Ocean. It is an ocean that links Australia to Indonesia, to India, to the Middle East, and to Africa. And it is increasingly an area of strategic competition. It accounts for half the world's container traffic and is a crucial conduit for global trade. It is home to some of the world's fastest growing economies –including five of Australia's top 15 trading partners: India, Indonesia, Malaysia, Singapore and Thailand.

We have given expression to our interests by strengthening our involvement in Indian Ocean rim states, and particularly importantly by working to develop the strategic and defence relationship with India. But a more coherent and coordinated international whole-of-government approach will only get us so far. All of these regional efforts are premised upon Australia maintaining a potent military capability to underpin our national security. So, to my third point, we need a Defence organisation that is able to anticipate, adapt and respond to these growing challenges. As a Defence enterprise, we must be ready today, to respond to a wider range of military commitments and together, drive much harder, the preparation and realisation of future capability. 

Early on in my tenure as Minister I had the opportunity to engage with the Defence Senior Leadership on my three strategic reform priorities. The first priority is to make sure our strategy framework is right. We need to ensure that we continue to proactively assess and respond to security challenges and greater uncertainty in our strategic environment, particularly in the Indo-Pacific.

Defence White Papers do not work on a set-and-forget principle, even comprehensively cast ones like the 2016 White Paper. They remain under constant review to ensure we can deliver against shifts in the strategic environment and new technology challenges. This comprises internal, classified processes that: stress-test our policy settings on a rolling basis; annually and comprehensively review Defence’s Force Structure Plan; and adjust budget and spending to achieve the Integrated Investment Program.

Getting the balance right between longer and short-term needs is no easy task, especially given the lead-times that some new capabilities require and the costs and risks associated with life-cycle extensions. My second priority is delivering and integrating new capability. We must effectively and affordably deliver the investment Australian taxpayers have made in modernising Australia’s defence capability to ensure our future force is more capable, agile, potent and safe. This is not just about spending money. It is also about ensuring flexibility and adaptability in our force structure to meet new threats.

The capabilities we acquire must be integrated fully to deliver on their full potential. The rapid pace of military modernisation in the region is stretching the Australian Defence Force’s traditional technological edge, as well as its presence within and beyond our long maritime borders. We have to be in more places at the same time, with new capabilities, in order to continue to monitor and understand our environment and advance our interests. And my third priority is reform and organisational transformation. We cannot — we will not — meet the strategy and capability needs to best protect Australia without a more operationally effective Defence organisation. An agile and transformative organisational backbone capable of responding as rapidly as our region is changing.

In conclusion - tonight I have outlined my views on power and how it is exercised, and how that applies to Australia today as we face a challenging strategic conditions. I’ve welcomed the opportunity to speak to an audience of Australia’s leading experts in the field of military strategy and capability. But I will leave you with this thought, it is not enough for us to talk amongst ourselves. We must open this conversation to the Australian community. We must analyse and debate the challenges our nation faces, and we must bring the Australian people along with us.

One of my favourite quotes is from Kim Beazley in 1987, and he described defence strategy in this way. He said, ‘the complex structures of decision making in Defence, producing as it does a clash of views amongst extraordinary well versed partisans of particular service and institutions interests, patriotic philosophers, optimists, pessimists, scientists and technological fixers, nationalists, internationalists – is more akin to ancient church councils – than to the town meeting approach democracy contemplates”. I believe that today, we need far more town hall meetings, and fewer ancient church councils, like that of here tonight. We need to better engage Australians so that we can better prepare the nation for the challenges ahead. It is a time of great change in our region.

A time to work harder and smarter with our partners to maintain the security and prosperity that has delivered so much for so many. But it also a time to reflect on our cherished sovereignty as a democratic nation and to ensure its protection and survival. Thank you for the opportunity to address you here tonight, I hope your discussions can help pave the way to this broader conversation I believe we all need to have about the struggle for power and influence in the Indo-Pacific region.