Annual Report 2006-2007
 

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Your location: Performance > Outcome 1 > Output 1.1 > 1.1.3 Americas

OUTPUT 1.1: Protection and advocacy of Australia's international interests through the provision of policy advice to ministers and overseas diplomatic activity

1.1.3 Americas

On this page: Overview :: United States :: Canada :: Latin America and the Caribbean :: Outlook

Overview

The formation of a separate Americas Division in July 2006 enhanced the department’s capacity to pursue Australia’s substantial and wide-ranging interests in the Americas. The creation of a branch dedicated to our relationship with the United States brought greater strategic capacity to the management of this mature and critical relationship. A separate Canada and Latin America branch (as part of Americas Division) allowed a greater focus on expanding Australia’s relationship with this dynamic part of the world.

The department worked to strengthen Australia’s fundamentally important and multifaceted relationship with the United States. A wide range of high-level visits and exchanges, including successful Australia–United States Ministerial (AUSMIN) consultations, maintained considerable momentum in Australia’s alliance with the United States. The department took forward implementation of the Australia–United States Free Trade Agreement (AUSFTA) as a framework to enhance closer interaction between the two economies and advocated reform of US agricultural policies in the debate over the 2007 Farm Bill.

We substantially increased bilateral interaction with Canada, affirming our close relationship with this natural partner and our cooperation in a range of multilateral forums. As part of our focus on improving Australia’s trade and investment relationship with Latin America, we laid the foundations for a comprehensive and ambitious free trade agreement (FTA) with Chile and inaugurated the Australia–Mexico Joint Experts Group on Strengthening Bilateral Relations (JEG).

United States

The department advanced Australia’s security, economic and people-to-people links with the United States. We supported ministers’ involvement in AUSMIN 2006, held in Washington on 12 December 2006. The talks, hosted by Secretary of State Dr Condoleezza Rice and Deputy Secretary of Defense Gordon England, were characterised by a strong commitment on both sides to maintain and further develop the critically important purposes of the alliance. A memorandum of understanding on Production, Sustainment and Follow-on Development of the Joint Strike Fighter aircraft was signed. There was also agreement to build support for the Global Initiative to Combat Nuclear Terrorism through outreach activities in South-East Asia, and a joint commitment to work together to help counter the proliferation of Man-Portable Air Defence Systems (MANPADS).

Cooperation at the policy and operational level on Iraq and Afghanistan highlighted the relevance and adaptability of the alliance. The department facilitated close coordination on counter-terrorism and on our response to the common challenge of dealing with nuclear-proliferating states such as Iran and the Democratic People’s Republic of Korea (DPRK) (see sub-output 1.1.10 for more information). We used policy planning talks in August 2006 to influence US thinking on governance issues, Asia-Pacific regionalism, Islamism and our APEC goals.

Apart from AUSMIN, the department supported a series of high-level bilateral visits that added further momentum and depth to the relationship. Mr Downer visited California, at the invitation of Dr Rice, as well as Hawaii in May 2007 for discussions on key strategic and political issues. In January 2007, Mr Truss paid his first visit to Washington as Minister for Trade to advance Australian interests in the Doha Round and reform of US agricultural support in the context of the 2007 Farm Bill debate. The department supported visits to the United States by five other federal ministers.

Photo - See caption below for description
The annual Australia–United States Ministerial (AUSMIN) consultations are a highlight of the bilateral calendar. In December 2006, the United States hosted the talks in Washington. From left to right: Minister for Defence Dr Brendan Nelson, Minister for Foreign Affairs Mr Alexander Downer, US Secretary of State Dr Condoleezza Rice, and US Deputy Secretary of Defense Mr Gordon England at the AUSMIN joint press conference.
Enlarge image :: Photo gallery

In January 2007, the ‘Australia Week’ program initiated in 2004 expanded from G’Day LA to G’Day USA, encompassing Los Angeles and New York. Mr Downer visited the United States during the promotion, which showcased Australian trade and investment opportunities and provided a vehicle to advocate our policy positions on energy, climate change and APEC. Mr Downer delivered a series of speeches and participated in events drawing influential US business and political audiences. Through the consulate-general in Los Angeles, the department supported the promotion of Australia as a safe and reliable supplier of LNG in California.

We helped facilitate the establishment of the United States Studies Centre at the University of Sydney. The Centre, co-founded with the Australian American Association and supported with a federal government grant of $25 million in 2006, will deepen Australian knowledge and understanding of the United States, strengthening the underlying links between people and institutions in the two countries. From 2008, the Centre will offer a comprehensive postgraduate program in United States studies.

The department continued to attach a high priority to implementation of the Australia–United States Free Trade Agreement (AUSFTA), now in its third year of operation. Working in close cooperation with other agencies, we negotiated a scheme to implement Australia’s commitments under the AUSFTA on the technological protection of copyright material. The AUSFTA-mandated review of Australian plasma fractionation arrangements (the process used to extract and purify proteins drawn from human plasma) was completed on schedule. The government procurement provisions of the AUSFTA were reviewed and efforts to have remaining US states sign on to the provisions continued. A professional services working group delegation visited the United States in May 2007 and the department worked in conjunction with representatives of the legal, accounting and engineering professions to secure access for Australian professionals to the United States market.

Jointly with the Department of Agriculture, Fisheries and Forestry, the department pursued expanded market access for Australian agricultural products. The department also built momentum for the second ministerial-level AUSFTA Joint Committee in early July 2007 to drive the AUSFTA implementation processes.

FIGURE 10. Australia’s trade in goods and services WITH the United States(a)

Figure 10: Australia's Trade in Goods and Services with the United States

(a) Goods data on a recorded trade basis, services data on a balance of payments basis.
Source: DFAT STARS database and ABS Catalogue 5368.0.

We provided an AUSFTA email and telephone hotline service and participated in a series of well-attended business seminars with Austrade that focused on making the most of commercial opportunities in the US market and the advantages available under AUSFTA.

The department advocated Australian positions on reform of US agricultural subsidies in the 2007 Farm Bill debate through a DFAT-chaired government–industry joint working group. A paper commissioned by the department from a well-respected Washington-based think tank on the Farm Bill highlighted the benefits of US agricultural reform. The paper was circulated widely among key US opinion makers, farm organisations and policy institutes following its launch in Washington in March 2007 and was referred to positively by the US Secretary of Agriculture, Mike Johanns, in public comments on the Farm Bill.

Canada

Photo - See caption below for description
The then Canadian Minister of Foreign Affairs, Mr Peter MacKay, hosted a visit by Mr Downer to Halifax, Nova Scotia, in September 2006. Mr Downer and Mr MacKay are pictured in the Speaker’s Library at Province House, Halifax.
Enlarge image :: Photo gallery

The department’s efforts contributed to a resurgence in Australia’s traditionally close relationship with Canada. There was substantially increased bilateral interaction covering multilateral, social, defence, tourism and business interests. The heightened activity involved all sectors and levels of government in both countries. The department facilitated high-level visits to Canada, including by Mr Downer, the Minister for Defence, the Attorney-General and the Secretary, underscoring the value we place on close cooperation and consultation with Canada across a broad agenda, including in relation to security and intelligence, energy and resources, the environment (where Australia is supporting Canada’s bid for membership of the Asia-Pacific Partnership on Clean Development and Climate—the AP6), and uranium supply and nuclear energy. On Afghanistan, defence and foreign policy cooperation assumed greater prominence as Australian and Canadian forces were once again engaged in a common cause, as we were in both world wars and the Korean War. The enhanced levels of collaboration in these areas added to our traditional consultation with Canada within the United Nations, APEC and other forums, and to our close consular relationship.

Latin America and the Caribbean

The department enhanced Australia’s relations with Latin America through the negotiation of new bilateral agreements to promote trade and investment, by advocating Australian interests in trade liberalisation and supporting high-level visits. Our trade and investment links have continued to deepen, with a 12 per cent increase in total merchandise trade in 2006.

On 8 December 2006, the Australian Government announced that it would commence a bilateral negotiation process with Chile, with a view to developing a comprehensive FTA. The department led preparatory meetings in Santiago to discuss the timeframe for negotiations and the scope of the agreement. We also continued to work with Chile on a wide range of multilateral issues—Chile shares Australia’s interest in achieving an ambitious result on agriculture in the Doha Round and works closely with Australia as a member of the Cairns Group and within APEC. The department facilitated a number of high-level visits to Chile during the year, and also supported visits to Australia by the Chilean Ministers for Foreign Affairs (Mr Foxley), Mining and Energy (Ms Poniachik) and Agriculture (Mr Rojas). A parliamentary delegation led by the Speaker of the Australian Parliament visited Chile and Peru.

The department maintained the momentum of Australia’s growing relationship with Mexico. The inauguration of the Australia–Mexico Joint Experts Group on Strengthening Bilateral Relations (JEG)—and its two meetings in April and June 2007–provided impetus and direction to our bilateral economic relationship, including the possibility of a comprehensive free trade agreement in the future. The department facilitated a visit by a delegation of Mexican members of Congress, and supported the inquiry by the Trade Sub-Committee of the Joint Standing Committee on Foreign Affairs, Defence and Trade into trade with Mexico and its region, including a visit to Mexico and Cuba. Our trade relationship with Mexico has continued to strengthen, particularly in the energy and education sectors.

The department continued to lead the development of a more dynamic relationship with Brazil. Our trade and economic relationship with Brazil is the largest in Latin America. Over 10 000 Brazilian students now study in Australia, making Brazil the tenth largest source of foreign students. The two countries held a senior officials’ meeting in Brasilia in March 2007, which highlighted our shared aim of liberalising trade in agriculture through the World Trade Organization. The department identified Brazil’s world-leading ethanol production expertise as a potential area for future bilateral cooperation. The first meeting of our Bilateral Trade and Investment Commission is due to be held in 2008.

In August 2006, the department supported a successful visit to Australia by the Minister for Foreign Affairs of Argentina, Mr Jorge Taiana, accompanied by a business delegation. The opening of the new Argentine-built nuclear reactor at Lucas Heights in April 2007 highlighted the potential for further cooperation on nuclear energy. We continued our cooperation with Argentina on trade policy issues, including in the Cairns Group.

The department continued to foster relations with other South American countries. We hosted a visit by the Deputy Minister for Foreign Affairs of Paraguay in March 2007, who was in Australia to open the Paraguayan consulate-general in Melbourne. We also maintained our good cooperation with Peru on APEC, and supported its successful bid for membership of the Cairns Group. We welcomed the announcement in June 2007 that Colombia would re-establish its embassy in Australia in the second half of 2007, which will enhance both countries’ capacity to further develop the bilateral relationship.

TABLE 7. AUSTRALIA’S TRADE IN GOODS AND SERVICES WITH THE AMERICAS
 
Exports
Exports
 
Imports
Imports
 
Goods and services (a)
2005
2006
Trend
growth
2001–2006
2005
2006
Trend
growth
2001–2006
 
$m
$m
%
$m
$m
%
United States
14,277
15,624
—2.6
28,190
32,023
1.6
Canada
2,327
2,366
0.9
2,503
2,815
4.7
Mexico
875
889
17.3
871
1,078
13.2
Total NAFTA
17,479
18,880
—1.5
31,563
35,915
2.1
Central America & Caribbean (c)
235
214
—3.0
591
698
8.0
Brazil (b)
861
892
17.5
730
838
11.6
Chile
213
303
13.1
213
270
10.7
Argentina (b)
155
181
20.3
207
168
2.2
Total South America (b)
1,332
1,493
13.5
1,184
1,287
8.9
Total Americas
19,384
21,081
—0.6
33,591
38,239
2.5

(a) Goods data on a recorded trade basis, services data on a balance of payments basis.
(b) Goods data only. Services data is not published by the ABS for these countries.
(c) Excluding Mexico.
Source: DFAT STARS database and ABS Catalogue 5368.0.

Our relations with the Caribbean were marked by the region’s hosting of the Cricket World Cup. The department deployed additional consular staff to the region to support the Australian cricket team and supporters, and coordinated the provision of a security advisory team from the Australian Defence Force, the Australian Federal Police and the Attorney-General’s Department. During a visit to Trinidad and Tobago in December 2006, Mr Downer opened formally the Australian high commission and witnessed Australia’s growing trade and investment interests in this small but energy-rich country.

The department continued to support the work of the Council on Australia Latin America Relations (COALAR). Throughout the year, COALAR sponsored a range of initiatives in the fields of business, tourism, education and culture, which added depth to Australia’s relationships with Latin American countries. COALAR produces a separate annual report.

Outlook

The department will continue to strengthen Australia’s alliance with the United States, including through the next AUSMIN consultations, which Australia will host. We expect the visit to Australia by President Bush and Secretary of State Dr Rice for the APEC Leaders’ meeting in September 2007 will provide an opportunity for a substantial bilateral program. With the race for US Presidential nominations gathering momentum into 2008, the department will monitor the evolving policy positions of key candidates and their potential impact on Australian interests. We will seek to build understanding and awareness of Australia among the new members of Congress elected in the 2006 mid-term elections. The department will continue to work closely on the implementation and forward agenda of AUSFTA with businesses, state and territory governments and other interested parties. In consultation with the embassy in Washington, the department will continue its efforts to counter specific US Farm Bill measures that impact negatively on Australia’s trade interests.

We will seek to consolidate Australia’s relations with Canada and Latin America, including during the APEC Leaders’ Meeting in Sydney in September 2007, which will bring, inter alia, the leaders of Canada, Mexico, Peru and Chile to Australia. The dynamic relationship with Canada will benefit from the official visit of Prime Minister Harper, as well as from our hosting of the Canada–Australia Dialogue in August 2007. The department will increase its presence in Peru, the host of APEC 2008. We expect to complete the FTA negotiation process with Chile over the coming year and to move to the next phase of the Joint Experts Group process with Mexico. The inaugural meeting of the Australia–Brazil Bilateral Trade and Investment Commission will underscore the growth of our economic relations with Brazil.

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