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Wednesday, 8 March 2000
Page: 14240

Mr HOLLIS (11:15 AM) —The Timor Gap Treaty between Australia and Indonesia was often used as an example of an unfair treaty. Everything that seemed to be wrong with that relationship between Australia and Indonesia seemed to be symbolised by that treaty. Some argued that it should not have been entered into or it should have been entered into with Portugal. At this stage, let me reinforce the view, regarding Portugal, of my colleague the member for Griffith.

The Portuguese were in Timor for over 400 years but they did very little and it has always, even with the debates over the years about Timor, somewhat amused me that the Portuguese took the high moral ground. The Portuguese have no reason to take any high moral ground on their role in Timor. On Monday, in tabling the Joint Standing Committee on Foreign Affairs, Defence and Trade report on the visit to East Timor last December, I said:

Geography and history dictate that we will have a close relationship with this new nation, but it will be a nation whose destiny will be decided by the Timorese.

This bill we are debating today will confirm that statement in more ways than one. It is one of the reasons why the opposition supports its introduction. The purpose of the bill is to reflect the fact that the United Nations Transitional Administration in East Timor—UNTAET—has replaced Indonesia as Australia's partner in the regulation and administration of petroleum operations in the Timor Gap. On 26 November 1999, eastern Australian time, Indonesia ceased to exercise sovereign rights in the area covered by the Timor Gap Treaty. UNTAET has agreed, acting on behalf of the new nation of East Timor, to assume all the rights and obligations which were previously the preserve of Indonesia. This has been formalised in the exchange of letters between Australia and UNTAET on 10 February.

The bill is consistent with the approach the opposition has advocated on the future of the Timor Gap and announced on a number of occasions by my colleague and shadow minister for foreign affairs, particularly in September 1998 and in January 1999. It should be recognised that my colleague and shadow minister for foreign affairs has led the way in urging Australia's reaction and renewed policy approach to East Timor both publicly and within the Australian Labor Party. I believe that needs to be recognised, and there is no better time than during this very timely debate.

UNTAET Administrator de Mello has said that this agreement has come at a very important moment for East Timor. The agreement provides for a simple transition for Indonesia's exit from the Timor Gap Treaty and for UNTAET's entry into the treaty relationship with Australia. East Timor's political leadership has confirmed acceptance of the transition process both publicly and privately. On 18 October last year, Xanana Gusmao said that it was his intention to respect the terms of the treaty. The agreement is an interim measure which is without prejudice. Obviously at some time in the future when East Timor emerges from this important transition stage, the future government of an independent East Timor may wish to conclude longer-term arrangements with Australia. In those circumstances, this bill may require further amendment or new legislation may need introduction into the parliament during this term.

This bill reflects a true partnership between Australia and the new nation of East Timor. Australia and East Timor both recognise the important need to maintain stable, uninterrupted operations, revenue flows and continued investment. The bill will contribute to investments certainly in the Timor Gap and for petroleum exploration and development. Over $700 million has already been spent on petroleum exploration and development since the treaty came into force in 1991. This is an important investment to develop a key resource for a new nation aiming to build for itself a new community and economy.

In July 1998 the first commercial oil production began with the commissioning of the Elang-Kakatua field. This oil production field generates revenue for both Australia and East Timor of about $3 million a year. I suggest, important as this money may be for Australia, it will be even more important for East Timor. The development and commercial operation of other projects in the zone of cooperation has a potential to generate nearly $15 billion in capital investment. Major onshore facilities near Darwin will be constructed. These oil production fields will provide tens of millions of dollars in revenue to East Timor for decades, beginning in four years time.

The Timor Gap Treaty has a great potential to significantly contribute much needed economic development to a struggling new nation. The fact that East Timor did not have an economic base was one of the arguments against East Timor's independence. It has also been suggested that one of the reasons Australia did not react more strongly when Indonesia invaded Timor in 1975 was that Australia did not want an economically poor and possibly unstable nation on its doorstep. Whether or not that is true is for others to argue, not me. The revenue generated for Australia will also assist us in ensuring economic development and stability in East Timor.

Australia has a tremendous obligation to assist this new nation, just two hours flying time away from our northern capital. But this association and assistance must be based on advice from the East Timorese. I have a worry that, because there are so many aid agencies in Timor—and it seems that every aid agency in Australia has to have a presence in Timor, even if only for domestic reasons of fundraising—there will inevitably be an amount of duplication in the work provided. It must be stressed—and this is a point that the member for Griffith was also making—that anything relating to aid or revenue in Timor must be Timorese led. I think it is very important to always respect the sovereignty of East Timor.

In our troop commitments of September last year following the mindless violence of the independent ballot, Australia finally began to repay a historic debt. Today Australia must continue support. We must and we will. But, as I said before, it must be Timorese led. We must respect their sovereignty. What we do not want there is a mini Australia. We want a sovereign, independent Timorese nation and I believe our treaty obligations will help that process.

The estimated cost for Australia to assist East Timor is already on the public record, outlined in the Prime Minister's ministerial statement of last November. The total cost for 1999-2000 to 2002-03 is expected to be over $3 billion. The changes reflected in the bill can provide a continuity in both countries' arrangements in the Timor Gap Treaty and confirms actions taken by the Timor Gap Ministerial Council and the joint authority since late October last year. The bill also includes a continuation of other arrangements in our taxation, customs, immigration, crime and quarantine legislation which Australia has linked with operations in the Timor Gap.

Many of us in this place and, indeed, in the wider community, have been legitimately critical of elements of the Indonesian military and of the government over recent months. Some of us have been critical of Indonesia for much longer, since the invasion of East Timor in 1975 and its incorporation as Indonesia's 27th province in July 1976. But I think it is fair to say that just as Indonesia under new President Wahid is mending bridges there, it is equally true that everyone in this parliament will want good and friendly relationships between Australia and Indonesia.

This bill and the arrangements it confirms could have been made more difficult had Indonesia insisted on keeping its claims under the treaty even after it ceased to exercise rights over East Timor. A number of Indonesian politicians from West Timor argued that Indonesia should continue to retain a share of the revenue from operations in the Timor Gap. However, such calls came to nothing when Indonesia made clear that its exit from East Timor also meant an exit from the treaty relationship with Australia, and we support this. The opposition provides bipartisan support for this important bill. It reflects the transitional nature of the political and economic developments now under way in the world's most infant of new nations.

Following the departure of UNTAET, East Timor's leadership and government are free to pursue aspects of this treaty and establish long-term arrangements. This is appropriate. East Timor should not be held ransom to a small economic base. The Timor Gap and the petroleum resource there must be available for East Timor's development and for the Timorese. Australia and East Timor are now linked forever. We should show our goodwill and optimism about our close relationship by this bill. The Timorese have paid a very high price for their independence, but I would like to echo the words of my colleague the member for Griffith, especially in regard to aid and the lessons that we should learn regarding aid from PNG.

When our delegation came back from PNG our report said that we should exit from the budget support aspect of our aid to PNG—which I always thought was wrong. We must never get into that situation, as he said, with the same arrangements with Timor. Despite revenue from the Timor Gap there will be a responsibility for Australia to continue to give aid. I think that when Timor goes off the world map, as it inevitably will, it will be left to Australia. Australia will continue to be the main contributor to aid there, and rightly so. My hope is that with this legislation we will maintain a good, strong, friendly relationship with Timor and quickly restore the good relations we have enjoyed for some time with Indonesia, especially now that an impediment to that relationship in Timor itself has been removed. The opposition, as all the speakers have indicated, strongly support this bill and I commend it to the chamber.