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Australia, Indonesia and the region - increasing understanding: address at the launch of the Institute of International Education, Flinders University, Adelaide

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Australia, Indonesia and the Region - Increasing Understanding

Speech by the Hon Alexander Downer, MP, Minister for Foreign Affairs, to the launch of the Institute of International Education, Flinders University, Adelaide.


Professor Ian Chubb, Vice Chancellor, Flinders University, Professor John Keeves, Chair of the Institute of International Education, Dr Victor Ordonez, Director of UNESCO's Asia Pacific Office, Associate Professor Bob Teasdale, Institute Director, other distinguished guests, ladies and gentlemen.

I am very pleased to be able to take part in an educational initiative, particularly one in my home State, which will contribute substantially to Australia's involvement in the region. I therefore take great pride in launching Flinders University's Institute of International Education. The Institute, which began operations late last year with a view to managing and implementing major international research projects, has already attracted almost fifty members including from countries as diverse as Vietnam, Indonesia, Swaziland, Ethiopia, Singapore, China and Iran.

Indeed, we can see the role the Institute is already playing in furthering the cause of education in the region because Dr Ordonez will today also inaugurate the Asia-Pacific arm of UNESCO's global "Teacher Education for Peace Project". I am pleased to say the Institute will form the base for this project in this region.

Today I would like to address first the importance we attach to Australia's major educational contribution to the region and how successful Australia has been in exporting its world-class educational services.

Second, as I understand that Indonesia is an area of special interest for the Institute, I would like to take this opportunity to look particularly at Indonesia's current situation and what Australia is doing to assist it at this difficult time.

Part One: Australia's Educational Contribution to the Region

It is little wonder that Australia has an excellent reputation in the Asia-Pacific for its world-class education institutions. High calibre Australian graduates are making a vital contribution throughout the region. And when I say Australian graduates I am not only talking about Australians themselves but also about the countless other nationals who have benefited from an Australian education since the Colombo Plan began in the 1950s.

Australia has a proud history of educating people from throughout our region and, indeed, the world as a whole.According to UNESCO's global estimate, 1.35 million tertiary students pursue their education outside their home countries. Australia hosts more of these students on a per capita basis than the United States, the United Kingdom or Canada.

The Government is firmly committed to supporting Australian education. Education is clearly vital for the development of our own skills base and increasingly, thanks to innovative approaches and high standards, the education sector has become a prodigious export earner.

Responding to increased economic interdependence between countries and between industries, Australia has developed links between the education sector, industry and their counterparts around

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the globe.

The results have been spectacular.

Australian universities have thrived in the international market place following the introduction of full-fee paying courses for international students. Numbers of international students have grown quickly and today make up 9.6 per cent of the total student population of our 38 universities, providing around 6.6 per cent of their income. Last year international students, numbering more than 150,000, made a contribution of around $3.2 billion to the Australian economy.

This, of course, was only their direct financial contribution. The value of their contribution in raising other countries' awareness of Australia - and its products and services - is incalculable. We are now seeing large communities of graduates return home with a special understanding, high regard and affection for Australia.

Indeed, we have already seen the benefits of a growing Australian "alumni", particularly in the Asia-Pacific region, and I cannot stress enough how important these kinds of links are for furthering Australia's interests in the region.

A surprising number of senior figures in South-East Asian governments and businesses received part of their education in Australia. Just to take Indonesia as an example, Minister Hartarto, Minister for Development Supervision and Administrative Reform, is an Australian graduate, and so is Secretary-General Parapak, head of the Department of Tourism, Arts and Culture.

I know, however, that Australia's education exports are, to a certain extent, on the frontline when it comes to experiencing the impact of the region's recent economic difficulties. The good news is that the number of degree students coming from overseas this year is holding up well.

In fact, figures released last month by Federal Education Minister, Dr Kemp, show that while student numbers from South Korea and Thailand have dropped over the past twelve months, student numbers from other Asian countries have actually increased including, from Indonesia (up II per cent), China (up 9 per cent), Vietnam (up 46 per cent) and from India (up 41 per cent).

I have great confidence in the education sector's future.The region will continue to be a major source of fee-paying students, particularly as robust growth is expected to return in the medium to long term. An Australian education represents real value for money. The quality of life Australia offers so affordably will continue to attract students from around the world.

As I said in my introduction, the Institute, which has already attracted so many quality students from around the region and further afield, will be involved substantially in UNESCO's global "Teacher Education for Peace Project".

This project, which emphasises education for peace through cross cultural understanding, focuses especially on the preparation of teachers. The UNESCO project, I know, has been put in place to respond to the call in its report "Learning: The Treasure Within" in which Jaques Delors set out a vision for education around the globe in the twenty-first century.

The Melbourne Conference on Education for the Twenty First Century in the Asia-Pacific Region was held this week with over 600 participants attended including over 200 foreign participants. The Australian Government convened a meeting for regional education ministers attending the Conference to discuss the Delors report.

Both the Conference and the Ministerial Meeting were outstanding success. Participants committed themselves to carry forward the implications of the Delors report, to apply the findings to the needs of the region and to apply the general principles to the day-to-day working of our schools.

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The Conference noted the danger of a gulf developing in the educational attainments of the various countries of the region and participants committed themselves to bridging this gulf. Our active involvement in this meeting and our flourishing exports - as well as the Institute's hosting UNESCO's visionary project as it is implemented here in the Asia Pacific - make clear just how deeply Australia is involved in education around the region.

I am particularly pleased that this project will enhance further cross-cultural understanding in Australia and within the region.Indonesia, our nearest South East Asian neighbour, figures prominently in all our international educational activities and I know it is an important client for this Institute for one.

I feel sure, therefore, that you will all want to know what Australia is doing for Indonesia as it works through very difficult economic circumstances and what, in particular, came out of my discussions in Washington two weeks ago.

Part Two: Australia and Indonesia - The Closest of Neighbours and Friends

The Government recognises that Indonesia is vital to our interests.Certainly, Australia cannot - as some people would have us do - stand as a spectator during a period of enormous difficulties for our nearest Asian neighbour, a country - let me remind you - whose southernmost borders are as close to northern Australia as Sydney is to Canberra.

Indonesia is our close neighbour, and a very important friend in the region.A populous vital country, Indonesia has always been a major player in South East Asia and we have developed a broadly-based and complex relationship over the last fifty years.

Australia supported Indonesia's drive for independence in the 1940s. We were there again to lend a hand when the International Governmental Group on Indonesia was formed in 1966 to help it through financial difficulties at that time.Over subsequent decades our economic ties and the all important people-to-people ties have flourished - and the education sector has, of course, played a vital part in that process.

Also, Indonesia has assisted us in any number of international forums as we have become increasingly like-minded on a number of issues.

There remain many differences, of course, but we have been prepared to discuss them as friends.Indeed that friendship allows us to put our views forthrightly on a range of issues.

In addition to our close relationship with Indonesia over many years there are many more reasons why Australia has been investing considerable time and energy in trying to assist Indonesia deal with its economic difficulties over the past six months or so - and particularly in the last few weeks.

We have vital interests to advance in Indonesia.These relate, of course, to our very substantial trade and investment there, our desire to see Indonesia continute to contribute to regional economic and political stability and our humanitarian concerns for the people of Indonesia.

But fundamentally, we have acted quickly and forcefully to help shore up the long term stability of a major neighbour and regional security partner. The consequences of our collectively failing to help Indonesia work through this situation could be extraordinarily damaging to our interests and those of the region as a whole.

That is why I visited Indonesia in January and why I flew to Washington two weeks ago to discuss the next steps with the IMF, the World Bank and with the United States Administration. That is why I have made sure that Australian views on Indonesia's crucial importance to our own

interests, and as a major South East Asian political and economic player, have been heard loudly 19/05/1998

and clearly in the lead-up to decisions about the IMF package and other assistance to Indonesia.And we have been putting similar views to other important G7 players.

Put simply, we believe that any revised IMF package has to achieve a very difficult balancing act.The package has both to be rigorous enough to achieve credibility with markets but it also has to recognise the complexities of Indonesia's social structure.

On the one hand, pushing the pace of change in Indonesia so fast that it rends apart the web of inerconnections which make up Indonesia's social fabric would be utterly self-defeating.On the other hand, failure to satisfy markets that necessary change will take place would be an equally unproductive exercise.

I left Washington confident that all parties were striving to achieve that balancing act with renewed vigour. That is an important reason why this week we have seen considerable progress on this front with Indonesia and the IMF moving much closer to resolution of their differences on the best way to approach the situation.

Australia's voice has been heard - because our vital interests are engaged - and, to a large extent, I would have to say, our views have prevailed. Australia has, from the beginning of Indonesia's economic difficulties some six or seven months ago, been committed to ensuring adequate food and improved conditions for the Indonesian people.In the process we have also stood shoulder to

shoulder with our exporters whose substantial business in Indonesia has been under threat.

Let me outline four important ways in which Australia has helped in recent times.

First, we were among the earliest to contribute to the original IMF package of USD 43 billion announced in November 1997 through our pledge of USD 1 billion.These funds will be disbursed as Indonesia and the IMF work through the process of reform agreed between them.

Second, we have made significant levels of trade credit and insurance available to Australian exporters to assist them in selling to customers who, as a result of the exchange rate difficulties, have been unable to obtain hard currency to purchase consumables or inputs for their own export sector.

Last month we announced that $A380 million would be dedicated to wheat exporters in particular and we are currently looking at other areas needing assistance on a case by case basis. I also note that we are working hard with a range of countries both around the region and further afield to find workable solutions to making export credit available to hard currency starved Indonesian firms.

Third, Australia has pushed hard with our international colleagues the need to address Indonesia's private sector debt.Partly as a result of that work in Washington and Tokyo I think we are seeing some new and workable solutions emerging.

Finally, I made a particular effort while in Washington to make sure that the World Bank was in agreement with our assessment that there is an urgent need to consider the food supply and humanitarian impact of the crisis on the Indonesian people. Tens of millions of Indonesians are falling below the poverty line as a result of currency shifts and this is not simply a numerical calculation. The crisis is having a very real impact on jobs and also on the cost of vital consumer goods, including food, which depend on imported inputs.

It was a major objective of mine in visiting Washington to ensure that world donors "stayed on the case" and ensured that Indonesians did not starve as a result of international currency movements. I was therefore particularly pleased that World Bank President James Wolfensohn agreed with me that a broadly-based meeting of World Bank donors and others capable of contributing to meeting any emerging food shortages in Indonesia should meet as soon as possible to discuss ways to

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address the problem.

The meeting held two days ago in Washington achieved agreement that the dono community needs to assist Indonesia in the areas of balance of payment support, Budget support, income generation activities and targeteed emergency assistance to Indonesia's eastern islands badly affected by drought.

Australia has already given $8.8 million worth of emergency assistence to Indonesia and will, naturally, as a result of the World Bank donors meeting consider a further significant humanitarian assistance package to Indonesia.

After all, the World Bank donors meeting found that Indonesia faces a potential food deficit and will need to import significant tonnages of food in the immediate future to over come the shortage, caused in part by a deficit of at least three million tonnes in rice production.The meeting also found that the cost of health supplies have risen dramatically as a result of the collapse of the rupiah, meaning the delivery of basic health services has become more difficult. According to the meeting, poverty is also clearly on the rise because of increasing unemployment and the rising cost of basic commodities.

Australia has well and truly "stayed on the case" in assisting Indonesia in their time of need. And we will continue to do so for as long as it takes to find the right solutions.

I am also pleased by the Indonesian response to Australia's role. This has included favourable editorials in two very influential Indonesian newspapers. Kompas has described our role in visiting Washington to look for a formula for flexibility as showing the real meaning of being a friend and neighbour. Kompas said on 19 March of the mission to Washington:

"In the context of friendly neighbouring ties with Australia we should feel lucky. Indeed Canberra has so far remained neutral and understands our social, political and economic sensitities."

The Indonesian Observer said, only a day later, and I quote:

"Australia has demonstrated its good neighbourly policy with its untiring effort to try to make other countries have a better perception of Indonesia's problems".

So you can certainly see that our actions in persuading international financial institutions of the complexities of the situation and of the need for urgent action in addressing the crisis's impact on the Indonesian people has been widely hailed in Indonesia.

I think Australia stands taller in the region's eyes and, indeed, in international financial circles as a result of our bringing our in-depth knowledge and understanding to bear in relation to the discussions which have taken place in Washington and around the world.


I would like to conclude today by applauding the Institute of International Education and UNESCO for what they are doing to enhance the lives of people in our region and particularly in Indonesia.There is no more important way of helping people than to enable them to help themselves.Education does just that. In particular, UNESCO's efforts to enhance cross-cultural understanding will be very valuable for the ongoing development of the region.

Australia is seeking to help Indonesia in particular get through these difficult times through the range of measures I have outlined for you today.We have demonstrated that Australia's friendship with our nearest Asian neighbour is not simply for the good times. We've been there for Indonesia in hard times before and we will do so again if need be.

We have been an advocate of finding a balance between necessary economic rigour and flexibity

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in dealing with one of the world's largest and most complex societies.If the right balance is found we believe that Indonesia will regain the market's confidence and so be able to trade its way out of difficulties.

Most certainly it is not Australia's role to attempt to dictate whether one group or another should govern Indonesia, a sovereign country of over 200 million people. Those saying so fundamentally misconstrue our role in the region. We have helped where we can because it is vitally in our interests to maintain economic and politicial stability within the broader region but most particularly in our immediate vicinity.

Indonesia is our closest Asian neighbour. We remain committed to being good neighbours and to working with our regional partners for the long term. That is why we are doing everything within our power at this time to ensure that a balanced and practical solution is found for Indonesia's current difficulties.

And that is also why I applaud the Institute of International Education as it promotes increased understanding and knowledge between Australia and our neighbours in Indonesia and the wider region.

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