Press Conference London

E&OE TRANSCRIPT

Press Conference, London

11 July 2018

SUBJECTS: Future Frigates tender announcement; militarisation of South China Sea

CHRISTOPHER PYNE: Well, thank you all very much for coming to this press conference. It’s a delight to be in London with the Premier of South Australia Steven Marshall here on such an auspicious day, being the Royal Air Force’s centenary celebrations, where I’ve been representing the Australian Government until mid-afternoon, and then this afternoon I’m holding the fifth Defence Industry Dialogue with Gavin Williamson, the Secretary of Defence, a dialogue that I established as the Minister for Defence Industry with Sir Michael Fallon a couple of years ago when he was the Secretary of Defence to put some more structure around the relationship between Australia and Great Britain in terms of Defence Industry. Obviously, it’s been very successful so far and we intend for it to continue to be successful.

Can I say about the Future Frigates, we’re particularly pleased that the response to choosing BAE to build the Future Frigates in Adelaide at Osborne, in the Premier’s state, has been so well received here in Great Britain and also in Australia. Obviously it was a very competitive tender between Fincantieri, Navantia, and BAE, but the decision’s been made and the work has already started to flow. In two weeks, BAE has already been announcing that they intend to increase their workforce by a thousand in Australia because of winning this Future Frigates and the other Hunter Class project; it will all be built in Australia using Australian steel, Australian workers, Australian know-how, in an Australian company with a Commonwealth sovereign share that will then revert to the Commonwealth when the project is finished, putting all that intellectual property and meaning the next generation of frigates and destroyers will be able to be designed and built in Australia from the ground up and exported from Australia and South Australia because of the decision that we’ve made.

So, obviously in my visit here today and tomorrow, I’ll be talking with the Brits about making sure that project is a success. There’s enormous good will on both sides of the table about making sure that that project is a success: driving jobs, driving sophisticated advanced manufacturing, research and development, but most importantly, of course, the capability for the Navy that means we’ll have one of the most potent anti-submarine warfare fleets in the Indo-Pacific - the hunter killer of the seas, the anti-submarine warfare frigate, making us one of the most potent and lethal navies in the Indo-Pacific region.

QUESTION: Whose submarines will we primarily have to [inaudible]?

CHRISTOPHER PYNE: Well, the anti-submarine warfare frigates will not be particularly hunting any other country’s submarines, but in the event that we have a situation where we need to defend Australia’s national interests and defence interests, the anti-submarine warfare frigate, the future submarines, and the air warfare destroyers - which are now being either in operation or the last one is about to roll off the production line - they will be at the - very much the front edge of the defence of our nation.

QUESTION: Mark Binskin has said that China has breached the trust of its allies or the region by militarising the South China Sea. Do you agree with that?

CHRISTOPHER PYNE: The Australian Government’s policy on the South China Sea is that we regard it as one of the most important water ways for our nation for our economic and defence interests and we intend to continue to exercise our international rights to traverse the South China Sea. We support the claims of the Philippines and other countries in the South China area who’ve won in the international courts the right to have China not militarise the South China Sea. We continue to talk to the Chinese, of course, about the role that they intend to play, but we don’t believe that what China has done so far will stop Australia or the United States, or the United Kingdom for that matter, from exercising their international rights to both fly through the South China Sea or take ships through the South China Sea.

QUESTION: But just specifically on what Mark Binskin said, which is that China breached its word in 2015 - Xi Jinping made that promise that they wouldn’t militarise the South China Sea. Do you agree that China has done that and in doing so breached trust of the world?

CHRISTOPHER PYNE: Well, obviously China has militarised certain atolls and coral reefs in the South China Sea - that’s a statement of fact. I haven’t seen the context of Mark Binskin’s - I assume one of his farewell speeches, he’s the Chief of the Defence Force - I haven’t seen the whole context of it. As I’m on the other side of the world, it would be unwise to comment on it.

QUESTION: Do you see the militarisation of those islands as a breach of international law?

CHRISTOPHER PYNE: Well, the International Court of Justice has already ruled that China has no particular rights in the South China Sea and found in favour of the Philippines’ action that they took. So, you can interpret that as you wish.

QUESTION: But doesn’t that imply, then, that they’re illegally occupying these islands and atolls?

CHRISTOPHER PYNE: Well, no one wants to hector, through megaphone diplomacy, the Chinese or the Japanese or the Indians or the US about what they should or shouldn’t do. A row with China, which might fill the pages of the newspapers and please the editors of newspapers doesn’t necessarily suit the best interests of Australia. Our role as a government is to make sure that the national interest of Australia is best served through sensible discussion, whether it’s with China or with any other country that has an interest in the Indo-Pacific.

We obviously encourage and welcome the United States’ role in the Pacific and the Indian Oceans. We are expanding our own military capability. The largest build up of our military capability in our peacetime history …

QUESTION: Why are we doing that?

CHRISTOPHER PYNE: … over the next ten years. We’re doing that because what’s very obvious is that we live in a much more unstable region and world, that we have lived in for several decades.

QUESTION: And do you believe that China has made the world more unstable?

CHRISTOPHER PYNE: Well, I don’t think it’s right to pick out one particular nation. But by 2030, 50 per cent of the world’s submarines will be operating in the Indo-Pacific region, and hence we’re investing in anti-submarine warfare frigates. There are obviously synergies between Australia and the UK, in terms of two Five Eyes countries, making our navies inter-operable as much as possible, with the US’s of course. And we have the most inter-operable Defence Force with the US of any country in the world, is a high priority.

QUESTION: What’s the danger of President Trump if he decides to pull back in any way from NATO, perhaps remove troops from Europe?

CHRISTOPHER PYNE: Well, the meeting between President Putin and Trump is coming up, I think on Monday next week, in Helsinki. I think it would be unwise for the Australian Minister for Defence Industry to try and pre-empt that meeting.

QUESTION: But clearly you would agree, would you not, that there is - keeping the United States engaged in NATO and in Europe is a positive, and if that’s lessened in any way, would that be a threat?

CHRISTOPHER PYNE: Australia regards the United States as the most preeminent world power. We want it to be the most powerful military power in the world. And therefore its alliances with NATO, in ANZUS, with Japan and South Korea, are critically important. We don’t want there to be a time in the foreseeable future where any other country has the same military capabilities as the United States, or reach of alliances around the world of the United States. That is not a likely outcome at this point of time. The United States remains the preeminent military power in the world and the one with the most friends. And fortunately, Australia is one of the United States most closest allies - its closest ally in the Indo-Pacific region, and we want it to stay that way.

QUESTION: Will a soft Brexit where the UK stays in the Customs Union have any impact on any future deals with Australia?

CHRISTOPHER PYNE: Well, our priority around Brexit is to assure that Australia secures a free trade agreement with the UK that’s as beneficial to both countries as possible, as soon as possible. And that is the priority of Steven Ciobo as the Minister for Trade and the entire government in Australia. And that is going very well, from all accounts. I think now would be a particularly unwise time for an Australian minister to comment on Brexit.

QUESTION: Mr Pyne now, one of your last visits to Britain Sir Michael Fallon quit. This time it’s Boris Johnson, are you infecting the Brits with the instability that we’ve shown?

CHRISTOPHER PYNE: The curse of Pyne, you think, Latika?

QUESTION: I think so.

CHRISTOPHER PYNE: Very unkind of you to point that out. In fact, unfortunately after I visited the Polish Minister for Defence, he resigned within a month, as well, of my visit. Well, I won’t be commenting anymore on that, apart from what I’ve already said.

QUESTION: But what did you make of Boris Johnson’s departure, it’s fairly sensational. He’s been a huge friend of Australia; does that not effect how Britain deals with us?

CHRISTOPHER PYNE: Every minister in the May government is a friend of Australia. We have no better friend, along with the United States in the world. And Boris Johnson was a great friend to Australia. We enjoyed his visit to Australia last year and he had a good relationship with Julie Bishop in particular, and we’ll have as good a relationship with Jeremy Hunt.

QUESTION: What about Boris Johnson’s application for political asylum in Australia?

CHRISTOPHER PYNE: [Laughs] Don’t know anything about that. Doesn’t sound very likely.

Premier, do you want to comment a bit on the role in South Australia in terms of skills, and training and jobs in terms of the Future Frigates?

STEVEN MARSHALL: Sure, I’ll just briefly say that obviously the federal government’s decision to award the contract for the Future Frigates to BAE presented us with a great opportunity in South Australia. I got over here as quickly as possible to meet with BAE, to meet with their supply chain, to visit the shipyard where they’re building the very first of the Type 26 up in Scotland. And look, I think that the opportunity that has been provided from this Commonwealth contract is absolutely incredible and we’re going to make sure that we grab that opportunity with both hands from South Australia.

QUESTION: Do you feel slightly guilty that the rest of the country is going to have to subsidise your massive boat buying program in SA?

CHRISTOPHER PYNE: [Laughs]

STEVEN MARSHALL: I don’t know what you mean about - I think the Commonwealth decision to ensure that Defence Industry is part of a strategic capability for our nation is crucial and to present a continuous ship build program provides that certainty, removes that risk for industry to invest. Now South Australia was the logical place for those ships to be built. I mean we’ve already now successfully completed the three Air Warfare Destroyers, OPVs will begin by the end of this year, and then we’re really looking forward to the Future Frigates and the Future Submarines being built in South Australia, but of course involving a supply chain which will come from right around the nation.

CHRISTOPHER PYNE: Okay, thank you all.

STEVEN MARSHALL: Terrific, thank you very much.

[ends]