Ties that bind beyond the dollars and cents

The boat people from Sri Lanka just wouldn’t go away. For six weeks they have dogged Prime Minister Kevin Rudd, at home and abroad.

At home with the opposition led by Malcolm Turnbull; and abroad risking eroding Australia’s political capital with its closest northern neighbour Indonesia - and testing relations further afield, to Malaysia and beyond.

They intruded into what was to be a celebration at Rudd’s attendance at the inauguration of Indonesian President Susilo Bambang Yudhoyono on October 20. The issue occupied the two leaders at the East Asia Summit in Hua Hin five days later, and at the Apec Summit in Singapore (November 14-15).

Yudhoyono was to make an official visit to Australia. He cancelled, citing scheduling conflicts. And Foreign Minister Marty Natalegawa questioned the value of the Rudd initiative for the Asia-Pacific community.

By the measure of other headlines, you’d think the news was all bad on Australia’s relations with Asia.

Relations with China and India have been tested: with China on human rights; and India over international education, and Australia’s refusal to supply uranium.

It all seemed remote at the corporate breakfast at PricewaterhouseCoopers’ executive suite in Melbourne. Viewed across the breadth of Australia’s engagement with Asia, the outlook is much more optimistic. Compared with the rest of the world, relations with Asia over the past year have been measurably brighter.

Statistically, Australia’s engagement with its top 25 friends in Asia went up 7.9 per cent from 2007 to 2008, while its links with the rest of the world went up 6.3 per cent. In the close to two decades from 1990, relations with Asia multiplied 4 1/2 times, while links with the rest of the world grew three times. That’s the finding of the latest edition of the PricewaterhouseCoopers Melbourne Institute Asialink Index of Australia’s engagement with Asia.

“Together, Asean, China and Japan make our western partners seem almost insignificant,” says Professor Tim Lindsey, director of the Asian Law Centre at the University of Melbourne. “Our future is tied to our region.”

Says Heather Ridout, chief executive of the Australian Industry Group: “The next generation of Australians will be drawn inexorably to the Asian region - because that’s where the action is.”

The index, in its second year since its launch in 2008, measures seven aspects of engagement: trade, investment, research and business development, education, tourism, migration and humanitarian assistance. The order as presented in the index may or may not have been intended. Read with the sentiment of Lindsey and Ridout, one could be persuaded that the measures as set out in the report might suggest a leaning towards material profit.

The academic Lindsey, in public forums, has, however, consistently taken a less hard-nosed line on engaging Asia. Lindsey will be heartened by a key finding of this year’s index, which suggests a reconciliation of his conviction of friendship for friendship’s sake, and the pragmatism of business.