Address to the Shangri-La Dialogue

Thank you to the IISS for convening the 21st Shangri-La Dialogue, the third I have attended as Australia’s Defence Minister. 

I would like to acknowledge generational leadership change in our host country. The Indo-Pacific can now continue to benefit from the experience and wisdom of Senior Minister Lee in the years ahead as we look forward to working closely with Prime Minister Wong. And we do this as next year Australia prepares to mark the 10th anniversary of the Australia-Singapore Comprehensive Strategic Partnership.

There is a new era of strategic competition that is reshaping our world and our region. Commentators have framed this competition in different ways: East vs West; North vs South; democracy vs autocracy. These frames obscure more than clarify. 

At the centre of this competition is quite simply the global rules-based order. 

There are those that are sceptical about this order. That at times it has broken under the pressure of human contest is a fact Southeast Asia understands better than most. 

And yet for all its failings we are far better off with it than without it. Our challenge is not to discard the imperfect but rather to make the promise of an ideal better. Because if we let it go the world will deeply regret its disintegration.

The global rules-based order is not a just a device – as some would cynically suggest – to protect the prerogatives of great powers and to prevent the rise of new ones. Rather, at its core is a two-hundred-year project to build a global system that is open and inclusive. An order that is based on rules as much as it is on power, and which seeks to balance the concepts of sovereignty and territorial integrity with the ideas of individual liberty and equality.

And the global rules-based order is not just a “Western project”. Many thinkers from China, India, Africa and from across the Global South have been central to its formation. 

Despite its imperfections, this order has come to oversee human activity around the world as diverse as nuclear non-proliferation, managing global financial risk, and international transport by sea and by air. 

Critically it has managed a global trading regime that has improved access to markets for developing countries. It has enabled the development of manufacturing not just in the Global North but also the Global South. It has created an interdependent network of global supply chains. And in the process of all this, it has fostered the greatest wealth creation in history. 

The global rules-based order has helped offset the advantages of the superpowers by giving agency to smaller states.

Invocations of this order can often be glib, but dismissals of it can be equally shallow and cynical. 

And we need to think hard about this because today the global rules-based order is under increasing pressure. We cannot take the peace and prosperity of our region for granted. 

Over the past year this pressure has increased. 

With increasing horror and grief we have watched the unfolding tragedy in Israel and Gaza. 

When Hamas executed its horrific act of violence on October 7 it was aiming to stymy an accord between Israel and the leading Arab powers. In the process the hopes of a two-state solution have become much more distant.

To be clear, in Australia’s view, it is imperative that Hamas not succeed. 

We call for an immediate humanitarian ceasefire in Gaza, the unconditional release of hostages, increased humanitarian relief for the civilians of Gaza, and steps towards a two-state solution in which Israel and Palestine live in peace together within agreed borders. 

As our recent vote at the UN General Assembly demonstrates, Australia seeks to build momentum for this goal alongside our regional partners. 

We have been clear that all parties must comply with international humanitarian law. 

Israel must comply with the binding orders of the International Court of Justice, including to enable the provision of basic services and humanitarian assistance at scale.

We have made clear that Australia respects the International Court of Justice and the International Criminal Court and the important role they play in upholding international law and the global rules-based order. 

If that order is to apply anywhere it needs to apply everywhere.

At the same time Australia’s position must not be taken as any kind of acceptance of a moral equivalence between Israel and Hamas. Clearly there is none. Israel is a democratic state. Hamas is a terrorist organisation.

Over the last year we have also witnessed a continued insistence by an increasingly militarised Russia to wage a brutal war against Ukraine, seeking to extinguish Ukraine’s sovereignty and the lives and aspirations of its people. Senior figures in Russia even muse about using nuclear weapons and invading other European countries.

Russia is a permanent member of the UN Security Council that has attacked another country and is threatening to use nuclear weapons if it does not get its way.

In truth, it is not security that drives Russia but a quest to reclaim lost empire. It aims to reverse the post-Cold War security order in Europe and, by extension, refashion how the world operates. It aims to shift the global rules-based order from one that seeks to strike a careful balance between sovereignty and liberty, between rules and power, to one that is based on power alone. 

Russia wants to take us back to a world where spheres of interest reign, where only great powers are truly sovereign, and their actions are above any law. 

That North Korea and Iran have chosen to become Russia’s strategic partners in this mission is perhaps not surprising. Both are internationally isolated for their profoundly disruptive behaviour, not least their persistence with nuclear programs in defiance of multiple UN Security Council resolutions. 

But the deeper question is the implications of China’s strategic partnership with Russia given its current malign and violent path. 

Vladimir Putin’s actions have made Russia a pariah. 

But China is the world’s second largest economy and the major trading partner for Europe and the United States. It is a great power whose culture, innovation and drive benefits the world in so many ways. 

Beijing aspires to regional and global leadership. Chinese officials now staff, and increasingly lead, multilateral institutions that perform the core functions of the global rules based order. 

At the same time China is building a military capability – including a nuclear weapons force – that seeks to be on par with the United States. 

So China’s support for Russia raises important questions about the role it intends to play as a global actor. 

As China steps up to a larger role it must accept, like all great powers, that there will be much greater scrutiny on the way it uses its strength and which countries it chooses to partner with. Acceptance of such restraints is the key to any successful and durable international order. 

Russia has made it clear it accepts no restraints. So it is important China sets out a counter example; that the exercise of Chinese power exhibits the characteristics necessary for our shared prosperity and security: respect for agreed rules and norms, where trade and investment flow according to agreed rules and binding treaty commitments. And where disputes among states are resolved via dialogue, and in accordance with international law. 

There has been a view, sometimes expressed by Chinese officials, that its strategic partnership with Russia is a necessary buffer against anti-China hostility. That is totally wrong. 

The economic rise of China has raised hundreds of millions of people out of poverty. In the process it has been a source of economic prosperity for many countries including Australia. 

There is no indelible hostility to China. It is about how we build a safer world and a safer region. 

China making clear – in word and deed – that it does not support the invasion of a sovereign country in violation of the UN Charter, consistent with China’s own longstanding commitment to the Charter’s founding principles of sovereignty and territorial integrity, would be a huge vote of confidence in Chinese regional and global leadership. 

The importance of this cannot be overstated. Confidence - and indeed trust – in Chinese intent will be the single most important ingredient to the maintenance of the global rules-based order. And by extension it will be at the heart of building a stable and prosperous Indo-Pacific region. 

A stable and sustainable regional order won’t be possible unless all countries – but especially big ones – pursue their strategic objectives in a manner that respects the sovereign rights of our neighbours and the obligations imposed by international law. 

That’s why we must pay attention to China’s strategic behaviour and the signals it sends. 

Actions by Chinese vessels in the West Philippine Sea, such as the use of water cannons and the ramming of Philippine vessels are a serious escalation of tensions and inconsistent with UNCLOS and the final and binding 2016 South China Sea arbitration ruling. 

China’s behaviour towards Taiwan creates similar concerns. PLA exercises that practice attacks and blockades of Taiwan do not inspire confidence that China prioritises - or is planning for - a peaceful settlement to the status of this island and its 22 million people. That the PLA has made a record number of incursions across the median line in the Taiwan Strait this year is part of this increasingly concerning trend.

The Australian Navy has also experienced recent unsafe and unprofessional behaviour by the PLA Navy and the PLA Air Force. I want to stress that the great bulk of the PLA’s interaction with the ADF are safe and professional. But the size and speed of PLA development means that interaction is occurring much more frequently. And activities that the ADF has conducted in the region for decades, safely and consistent with international law, are increasingly contested by the PLA. 

The activation of sonar while Australian naval divers were in the water in the East China Sea in November and the release of flares in the path of a naval helicopter last month posed a serious risk of injury to our personnel, while they were enforcing UN Security Council sanctions against North Korea.

In the face of these multiple sources of tension it is even more imperative that every country plays is part in managing increasing strategic risk. 

The reliance on security architecture, whether existing or new, is not enough. The lesson of Russia’s invasion of Ukraine is that our agreements, treaties and alliances are only as good as the hard power that backs them up. 

Developing military capability has its place. In Australia’s case, our annual defence spending will almost double over the coming decade to $100 billion, around 2.4 per cent of GDP. 

In addition to our individual capabilities, all nations need to invest in a form of collective deterrence. We cannot just appeal to great powers to conduct strategic competition responsibly. That is too passive. 

Rather we should seek, through our own national capabilities and regional architecture, to build a sustainable balance of power in the Indo-Pacific in which no one country in our region is militarily dominant. 

We must seek a set of conditions in the Indo-Pacific which constrain and ultimately preclude military options as a tool to seize or gain territory by ensuring that the risks of force outweigh any perceived benefit. 

Australia sees its investments in national defence capabilities as a necessary and prudent contribution to this balance. 

We must all deepen our network of strategic partnerships in the Indo-Pacific that more effectively integrate our capabilities. This of course has a strong bilateral dimension. 

Australia is deepening its alliance with the United States, including though enhanced force posture cooperation in Australia, as we welcome recent US force posture enhancements in Japan, the Philippines and elsewhere. But Australia is also expanding its defence relationships with Japan, Korea, India, Indonesia, the Philippines, Vietnam and other partners in Southeast Asia. These relationships have in fact have never been stronger, reflecting how we are all making choices about how to strengthen regional resilience. 

But this network effect has to have a strong multilateral dimension a well. ASEAN is key to this. Australia was honoured to commemorate 50 years as ASEAN’s first dialogue partner during the special summit in Melbourne in March. ASEAN cohesion has constituted one of the greatest strategic assets for the region over the past half century. Long may it continue to do so. 

New formations will matter as well. They will have different functions: some normative, some about capability, some about security, others about industry integration. Building more resilient supply chains is a key priority for Australia, which is why I’m endorsing at this dialogue the Statement of Principles to strengthen the region’s defence industrial bases. 

The point of these new groupings is to foster a constellation of states that act as a force multiplier for our collective security by not only helping us advance our own national capabilities but also contribute to the networking effect we seek.  

We need to recognise that all strategic theatres are interdependent now. Just as our economies depend on global supply chains, our strategic environments hinge on what happens in other parts of the world. Applying an exclusively geographic lens to our security challenges won’t work. How the war ends in Ukraine will matter to how countries asses their own military options, especially for Russia’s strategic partners. 

That’s why a greater European voice in Indo-Pacific affairs is important, and why we must heed what happens outside our region. 

Crucially, we need to make common cause with those states that seek to uphold rules that constrain the use of force, protect civilians, and hold abusers to account, irrespective of geography.

Finally, we cannot underestimate the importance of astute diplomacy and the requirement to invest in strategic reassurance. 

The risk with any deterrence strategy is that in seeking to prevent conflict, states miscommunicate and end up provoking one.  This will place a much greater premium on maintaining clear communication channels, at every level. We cannot afford lack of clarity in strategic intent.

So let me clear be clear about Australia’s intent: a stable and sustainable strategic order in the Indo-Pacific cannot be contingent on the internal order of states, or on illegitimate concepts such as containment. Equally, that order cannot develop in a strategic environment where sovereign rights and international law are ignored, especially by great powers. We must commit to the work of norm building that allows us to navigate this high-risk period without conflict or coercion, where all countries are free to pursue their national interest and where disputes are resolved through dialogue and in accordance with international law. 

This is the essence of the global rules based order and its maintenance must be the collective mission of us all.

Thank you. 

ENDS