Dean Smith (WA, Liberal Party) Share this | Hansard source

I was happy to indulge Senator Sterle so he could have the opportunity to put the position of the opposition on the record with regard to the second reading amendment that Senator Di Natale, on behalf of the Greens, will move later in the debate.

Much has been said about the importance of this treaty and, Senator Patrick, I did enjoy your contribution and being reminded of the chequered history with regard to Timor-Leste. I would like to, as part of some introductory remarks, reiterate just how important Australia's relationship with Timor-Leste is and to remind people that there are important trade and security investments but they are underpinned by a very, very strong and deep—I'm not quite sure what the word is, but it is a word like 'love' between Australians and the people of Timor-Leste. I think that, when you travel to places like Darwin and across the Kimberley region of Western Australia like I do regularly, you can really feel that sense of warmth and appreciation.

My association with Timor-Leste, or East Timor, as it was then, goes back to the early 1990s. I participated in an exchange program that was organised by what was then called the Australian young leaders program. Seven of us from around our country had the opportunity and the real privilege to travel to Indonesia at what was a very exciting time not just in Indonesia's democratic development but in our relationship with Indonesia. As part of that trip, we visited Jakarta, and I had the opportunity to meet and to listen very attentively to the Australian Ambassador to Indonesia at the time, Philip Flood. I'll never forget what Mr Flood said to me and the other delegates on this young political leaders program. He impressed upon us, in a soft voice, the imperative for Australia to pay close attention to Indonesia's need for a strong sense of national unity across that very extensive archipelago of islands.

In hindsight, that makes what has been achieved in Timor-Leste all the more remarkable. When you look at the development of Indonesia, and when you look at the political development of a country like Timor-Leste within that, you can't help but be surprised and impressed by how Indonesian thinking has changed and how Australian thinking has changed. Although Timor-Leste is a tiny and fragile neighbour, I think the path to democracy in Timor-Leste is one that should be constantly supported and constantly encouraged. I often have cause to reflect on what Phillip Flood might say now, when we look at what has happened in Indonesia—its remarkable progress towards increased democratisation. I'd argue that democracy in Indonesia has brought great stability. For those of us who travel to Indonesia frequently, the maturing of Indonesian democracy has been a stand-out achievement in our region more generally. I'm someone who says that Australia should be constantly deepening its relationship with Timor-Leste, deepening those economic and security ties, and, most importantly and most fundamentally, supporting Timor-Leste's democratic development.

In this morning's contribution, I just want to reiterate the importance of Australia's bilateral relationship with Timor-Leste, and our security and defence cooperation, and reflect on our trade and investment. As would be well known to those people who have made a contribution on this debate already, Australia and Timor-Leste are close neighbours with a shared history and strong people-to-people links. The Australian people have a special affinity with Timor-Leste, as I reflected on earlier, stretching back decades. The maritime boundaries treaty marks a new chapter in our bilateral relationship. While it has been fraught with difficulties, it is a landmark agreement, one that deserves to be supported, and I think it will shape the nature of our relationship into the future. It will revitalise our strong friendship and drive cooperation in the years ahead.

Australia is, of course, fully committed to the independence, sovereignty and economic sustainability of our near neighbours, and that includes Timor-Leste. Australia remains Timor-Leste's largest development and security partner, with $96.1 million in overseas development aid provided to Timor-Leste in 2017. Australia will continue to support its objective of economic diversification and private sector growth through our development, cooperation and labour mobility schemes. We look forward to partnering with Timor-Leste to develop the Greater Sunrise gas field, which will bring important benefits to both Australia and Timor-Leste.

Australia will continue to support Timor-Leste's armed forces and national police. We cooperate on regional security issues, including very real challenges around our maritime issues, border security and transnational crime. Australia supports Timor-Leste's ambition to join ASEAN to facilitate its closer economic engagement with South-East Asia.

This year, 2019, is a very important year for Timor-Leste. It is the 20th anniversary of Timor-Leste's independence referendum and the subsequent deployment of INTERFET to restore peace and stability. It's 20 years young, the modern democratic country of Timor-Leste. That's something that I think we should find time to celebrate and reflect on, but we should also put our minds to what we can do to ensure that the democratic experience in Timor-Leste is as robust as it can be. Australia looks forward to marking these events, together with our Timorese friends, over the course of the coming year.

In regard to security and defence cooperation, Australia has been at the front line in supporting Timor-Leste transition to independence and—as is well-known to this parliament—led the multinational INTERFET force, which restored security in Timor-Leste following the 1999 post-independence-ballot violence. Australia also led the 2006-2013 International Stabilisation Force, or the ISF, which was comprised of Australian and New Zealand defence forces. The ISF provided security back-up to the United Nations Integrated Mission in Timor-Leste and remained in Timor-Leste at the invitation of the Timorese government for some time after. Australia's defence and police engagement with Timor-Leste continues through the Australian Defence Cooperation Program and the Australian Federal Police's Timor-Leste Police Development Program.

On the important issue of trade and investment, which goes to the core of this treaty agreement, in 2018 two-way merchandise trade between Australia and Timor-Leste was worth just $21 million, so there's definitely room for marked improvement. Australia's exports to Timor-Leste totalled $20 million, and the major export item was passenger motor vehicles. Imports from Timor-Leste totalled around $1 million, made up primarily of coffee. There is, of course, room for growth in this two-way trade merchandise, and the Australian embassy in Dili has targeted initiatives in place to support Australian businesses to take advantage of investment opportunities in Timor-Leste. Australian businesses have found opportunities in construction, logistics, business and financial services, vocational training, consulting, tourism and security. Timor-Leste has had preferential duty-free access and quota-free access to the Australian market since July 2003. Australian development programs are supporting the non-oil private sector in Timor-Leste, including through investments in health and education, governance, and strengthening the business environment. Timor-Leste is the third-largest participant in Australia's Seasonal Worker Program, and remittances are an increasingly significant contribution to Timor-Leste's economy.

Before I go on to talk about the treaty, I've just been reminded—I'm glad that Senator Brockman is in the chamber with me, because I'm hoping that he'll endorse the comments I'm about to make. To those officials in the Department of Foreign Affairs and Trade who might be listening to this at the moment—indeed, to officials sitting to the right of me—there is one particular project in Timor-Leste that I would like us to give closer attention to, and I'm not satisfied with the amount of work that has been done. Senator Brockman, can you guess what that project is? We were just talking about it on the weekend.

Senator Brockman interjecting—

There is this proposition to use Australian aid money to support the development of jetty facilities in the north of the island. Those jetty facilities would support the export of cement, if I recall the project correctly, but not exclusively so. By providing aid to support an infrastructure project like that one, what we do is support not only the development of this particular industry but the economic development of the northern part of Timor-Leste. All of Timor-Leste is in need of important development support, but the northern part of the island, particularly, is in need of support and encouragement in regard to economic development. I'm someone who believes that if we were to provide third-party access to an infrastructure project, like better jetty facilities, that would multiply, if you like, the economic benefit that comes to that particular part of Timor-Leste.

I've not had a chance to prosecute this proposition directly with officials from the Department of Foreign Affairs and Trade. If they're watching this afternoon, it's top of mind for Senator Smith; top of mind for Senator Brockman; top of mind, I suspect, for Senator Reynolds, who is the new defence minister; and top of mind, I suspect, for Melissa Price, the member for Durack, which covers the Kimberley part of our state and the far north-western part of Australia. This is a project that is worthy of attention and worthy of closer examination. If, for whatever reason, it doesn't fit the tight confines of our aid budget, let's explore what more we can be doing to think laterally about how we might be able to give some impetus to what I think is an important infrastructure initiative for Timor-Leste.

Moving back to the items before us, the Timor Sea Maritime Boundaries Treaty Consequential Amendments Bill 2019 and associated bills, I will say some key points in summation. In March of this year, Australia and Timor-Leste signed an historic treaty on permanent maritime boundaries. The treaty was the result of a conciliation process, a process that Senator Wong reflected on earlier in her brief contribution. Under the 1982 United Nations Convention on the Law of the Sea, it gives clarity on the ownership of maritime resources in the Timor Sea and is important for Timor-Leste's economic future. It reflects Australia's commitment to the independent sovereignty and economic stability of Timor-Leste and lays important foundations for a new chapter in our bilateral relations.

The majority of necessary legislative amendments to implement the treaty were induced in early July and the remaining amendments were introduced this week. The amendments are technical and mostly designed to ensure that existing petroleum operations in the Timor Sea can continue under equivalent conditions, as required by the treaty. The government has consulted closely with the affected companies and with Timor-Leste in drafting these amendments.

While the legislation establishes the Greater Sunrise Special Regime, the regulatory and governance framework for managing the development of the resource, a decision on the development of the Greater Sunrise resource itself is not required in advance of bringing this treaty into force. The treaty states that the resource may be processed in either country. Timor-Leste has publicly stated its preference to process the resource onshore in Timor-Leste.

The treaty consists of a number of inextricably linked elements, which are part of the overall agreement, including three key elements: permanent maritime boundaries between Australia and Timor-Leste in the Timor Sea, in recognition of both states' sovereign rights; the creation of Greater Sunrise Special Regime for the joint development, exploitation and management of the Greater Sunrise gas fields; and, finally, transitional arrangements to provide regulatory certainty and continuity for affected oil and gas projects in the Timor Sea. The treaty makes clear that the outcome represents a mutual accommodation, which is without prejudice to either side's legal position.

The bills contain various transitional arrangements, but I would just like to reflect on what are some of the revenue implications of the treaty. Firstly, Australia and Timor-Leste have agreed that, from the date the treaty enters into force, Timor-Leste will receive a future upstream revenue derived from the various petroleum leases in the existing Joint Petroleum Development Area. Previously, both Australia and Timor-Leste have received benefits from revenue derived from petroleum activities in this area. Ninety per cent of that benefit has been delivered to Timor-Leste and 10 per cent has been delivered to Australia. Australia and Timor-Leste have also agreed that the Buffalo oil field, which previously fell within the continental shelf of Australia, will fall within the continental shelf of Timor-Leste. Accordingly, Timor-Leste will receive all future revenue from the Buffalo oil field. The detailed financial impacts of this will not be published due to their confidential nature.

As all speakers have reflected, this is an important milestone in the development of our relationship with Timor-Leste. I hope it will be seen as perhaps a turning point for a more harmonious and a more future-driven relationship between ourselves and our Timorese friends, remembering always that we have a very important shared history. Australia has been there at some of the most difficult times, when we think about the democratic development of Timor-Leste, underpinned always by this great affinity that Australians have with our Timorese friends. I'll leave my contributions to that.