RUDD'S VISION FOR NEW REGIONAL ARCHITECTURE

C O N F I D E N T I A L SECTION 01 OF 04 CANBERRA 000585 NOFORN SIPDIS STATE FOR EAP E.O. 12958: DECL: 06/06/2018 TAGS: PREL PINS AORC AS SUBJECT: RUDD'S VISION FOR NEW REGIONAL ARCHITECTURE Classified By: Deputy Chief of Mission Daniel A. Clune. Reasons 1.4 (b ),(d) ¶1. (C/NF) SUMMARY: Seeking to assert Australia's influence in in the region, Prime Minister Kevin Rudd has set out an ambitious vision for a new Asia-Pacific Community to be established by 2020, loosely modeled after the European Union, to respond to the shift of global economic and strategic weight to Asia. The new regional structure, which would span the entire Asia-Pacific region to include the United States, Japan, China, India, Indonesia and other as-yet-unspecified states, would promote dialogue, cooperation and action on economic, political and security matters. PM Rudd was careful to avoid suggesting the new architecture would replace existing regional bodies, but it is clear the new structure is intended to overcome current limitations, particularly on security cooperation, in APEC, ARF, East Asia Summit, ASEAN 3 and ASEAN itself. Rudd welcomed the evolution of the Six-Party Talks into a "wider regional body to discuss confidence and security building measures in Northeast Asia and beyond," and argued an Asia-Pacific Community was consistent with President Bush's call for a Free Trade Area for the Asia Pacific. Rollout of the initiative appears to have been hastily managed, with minimal internal discussions and little if any external consultations. Domestic reaction has been largely negative, with most local media reporting that Asian countries are taking a cautious approach to the initiative. END SUMMARY ¶2. (U) PM Kevin Rudd announced a proposal to spearhead the creation of an Asia-Pacific Union similar to the European Union in an address on June 5 to the Asia Society AustralAsia Centre in Sydney. Rudd tapped veteran Richard Woolcott, an 80 year old retired diplomat who played a key role in the creation of APEC, to serve as special envoy. The government will dispatch him to capitals thoughout the region over the next six months to lobby leaders to support the creation of such a body. In typical fashion, Rudd also envisions a high-level conference of government and non-government representatives to advance this proposal. KEY POINTS OF THE SPEECH ¶3. (U) Rudd declared there is a need to have a "vision" for an Asia-Pacific Community and that vision will embrace an institution which spans the entire Asia-Pacific region - including the United States, Japan, China, India, Indonesia and the other states of the region. Additionally, this institution will be able to engage in the full spectrum of dialogue, cooperation and action on economic and political matters and future challenges related to security as well as encourage the development of a genuine and comprehensive sense of community. He stated, as currently configured, none of the existing regional mechanisms are capable of achieving these purposes. ¶4. (U) The Australian government sees this as the opening of Q4. (U) The Australian government sees this as the opening of a regional debate about where countries in the region want to be in 2020, however, Rudd said the debate does not itself mean the diminution of existing regional bodies such as APEC, ASEAN, the ASEAN Forum, ASEAN Plus Three and the East Asia Summit, although he described them as lacking the ability to promote cooperation across the entire region. He suggested they will either continue in their own right or become the building blocks of an Asia-Pacific Community. ¶5. (U) Citing European integration, Rudd pointed out there are lessons to be learned from that effort, but creation of an Asia-Pacific Community would present a unique set of challenges specific to the region: diversity of political systems and economic structures, levels of development, religious beliefs, languages and cultures make a European copy cat approach impossible. He hopes this effort will CANBERRA 00000585 002 OF 004 capture the spirit of the European Union by resolving to build prosperity and a common sense of a security community. ¶6. (U) The Government has a foreign policy goal of comprehensive engagement with Asia. Rudd stated, "the speed and scope of changes in our region means we need to act now. Ours must be an open region - we need to link into the world, not shut ourselves off from it". This includes continuing support of President Bush's call for the development of an Asia-Pacific Free Trade Area. IDEA IS RUDD'S BABY ¶7. (C/NF) Foreign Policy Advisor to the PM Scott Dewar told Econcouns June 5 that Prime Minister Rudd put a great deal of time and energy into the speech and that the idea of a new grouping is "his baby." Noting that he had completed a first draft "last week," Dewar said that the final version had been extensively rewritten, with the PM working on each successive version. Dewar said that Australia had previewed the idea "in Washington," as well as with Japan, the ROK, Indonesia, the PRC, India and Peru (in its capacity as APEC host). No one objected, he said, adding that the Indonesians expressed interest in further discussion during PM Rudd's upcoming visit. ¶8. (C/NF) Rudd believes that current Asian architecture suffers from a variety of problems, particularly the lack of a forum involving the key Asia-Pacific players to discuss security issues in a meaningful way, according to Dewar. Stressing that Australia has no particular view on the specific membership other than it must involve the United States, Japan, India, Korea, China, Indonesia, Singapore, Malaysia "and other Southeast Asian partners," Dewar said that Rudd believes that this is question to be settled in the longer term. The same goes for the relationship of a new structure to existing groupings such as the ASEAN Regional Forum (AFR),APEC, ASEAN plus Three and the East Asia Summit. The goal is in no way to subsume or replace those organizations, Dewar insisted, though he acknowledged that the proposed Asia Pacific Community would overlap with the ARF and APEC. Though some may see Rudd's speech as laying out a body similar to APEC but with India and dealing with security issues, Dewar said that Australia recognizes that the questions of membership and mandate cannot be decided now and will require considerable discussion over some time. ¶9. (C/NF) The PM believes that the Howard Government made a mistake in not continuing the Hawke-Keating Governments' efforts to shape regional institutions. Explaining that Rudd thinks that the past ten years were a "missed opportunity" for Australia to help shape Asia's evolving architecture, Dewar said that Rudd wants to build on Australia's role in shepherding the creation of APEC. The PM sees this as an appropriate role for a "middle power," as there would be suspicion of the goals behind such a proposal if it came from Qsuspicion of the goals behind such a proposal if it came from China, Japan or the United States. ¶10. (C/NF) When asked about the implications for Taiwan, Dewar said that there had been considerable thought and discussion of the question in recognition of the fact that Beijing is likely to object to Taiwan's inclusion in any new regional grouping, Dewar said that Australia recognizes Taiwan's importance in the region and does not want to see its status downgraded. Dealing with the PRC and Taiwan will be a challenge for any regional body, he said, adding that much will depend on the evolution of cross-strait relations in the coming years. However, Australia does not believe that concern about Taiwan's status is a good reason to put off creating an Asia-Pacific grouping that can effectively address security issues. ¶11. (C/NF) Asked about Latin American membership, Dewar said that while some Asian countries are likely to oppose the Latins, Australia assumes that U.S. membership means Latin CANBERRA 00000585 003 OF 004 American membership. In passing, he commented that "we assume that the Latins would be part of the package with the United States." While some Asian countries would prefer not to have Latin American membership and that it is much less of a priority for Australia than the United States, Dewar did not see it as a major problem. NEGATIVE DOMESTIC REACTION ¶12. (U) The proposal was met with immediate criticism by two former Labour Prime Ministers, Bob Hawke who was instrumental in setting up APEC and Paul Keating who worked to extend it as a forum where regional leaders have regular meetings. Both stated the proposal won't work if it uses a model similar to the EU. Keating says a regional community is unachieveable and that APEC should remain the key regional power - Rudd insists he seeks to build on APEC. ¶13. (U) Former Foreign Minister Alexander Downer labelled the plan simplistic and meaningless. "This is a stunt to suggest that, well, he's got some different idea. It's not a different idea - it's a good idea, but it's the same idea as John Howard had and Prime Minister (Yasuo) Fukuda of Japan has and so the list goes on," Downer told the media. ¶14. (U) Opposition foreign affairs spokesman Andrew Robb describe Rudd's proposal as presumptuous and half-baked. "There's absolutely no detail, it does start to smack of a stunt designed to deflect attention from the damage the Prime Minister has done to our relationships with Japan and India. Strong bilateral relationships are the foundation of a strong regional structure, not the other way around, so his priority must be to get our bilateral relationships in the best possible order." MINIMAL CONSULTATIONS ¶15. (C) Evidence suggests Rudd's initiative was hastily rolled out, with minimal consultations. Most working level contacts within the GOA seem to have been caught off guard by the PM's announcement, with many embassies advising that they had received notification immediately before the speech and had not been consulted on the concept. Even Richard Woolcott, a distinguished former Secretary of the Department of Foreign Affairs and Trade, only learned of his role as the special envoy to carry the initiative forward some three hours before PM Rudd's address. He told us June 5 the PM's senior advisor had telephoned him at about 4 p.m. the previous day to ask if he would consent to spearhead the initiative, and when he remonstrated that he wanted an opportunity to discuss it further, was advised his name was already in the PM's pre-printed speech, leaving him no choice but to accede. Except for a brief exchange with PM Rudd at the speech venue, Wolcott said he was still waiting to get a full briefing from Rudd and his staff. COMMENT ¶16. (C/NF) Rudd's remarks on regional architecture over the past year or so, contain oblique references to addressing limitations of existing architecture, but he has not Qlimitations of existing architecture, but he has not previously hinted at this bold idea. With his election in November 2007, barely six months ago, Rudd seems to be in a hurry not only to demonstrate Australia's regional influence as a "middle power," but also to begin to establish his legacy. It is not surprising that Rudd reached out to Woolcott, a former mentor during Rudd's brief diplomatic career and a special envoy of Prime Minister Bob Hawke twenty years earlier in promoting another Australian initiation: the Asia-Pacific Economic Cooperation. The notion of an EU-style Asia Pacific Community that can smoothly manage the myriad political, economic and security interests all the major players in this vast region seems a considerable stretch of the imagination, but reflects the Australian view of the need CANBERRA 00000585 004 OF 004 to improve on the present disparate set of organizations. MCCALLUM