 Ladies and gentlemen I think we'll begin the proceedings and thank you all for coming it's such a cold beautiful you can't hear me okay is that better yes okay on such a cold beautiful Canberra morning for those of you who have come from outside Canberra all I can say is at least the sun is shining which is better than yesterday but it won't be warm I'd like to begin first I should introduce myself I'm Jenny Corbett and I'm the director of the ANU's Japan Institute and on behalf of the co-organizers of the update that is the Japan Institute and the Australia Japan Research Centre and the co-organizer Dr. Shiro Armstrong I'd like to welcome you all here this morning and for the day's proceedings I'll begin with our traditional acknowledgement of the Anahual people on whose traditional lands we meet and I'd like to pay our respects to their elders past and present and extend that respect to any indigenous entire straight Islander people who are here with us today I'd like to thank our sponsors these events involve a lot of organizing but also a lot of financial and in kind support and I'd like to acknowledge all of the organizations that have helped us the Australia Japan Foundation the Japan Foundation and the College of Asia and Pacific at the ANU this is our fifth Japan update this one is on the theme of seeking new directions we'll and the update is as many of you will know the flagship conference of the AJRC in the Corvid School of Public Policy and the Japan Institute where we bring together experts from Australia from Japan and from around the region to update us all and give a comprehensive overview of Japan's current economic and political landscape and in particular to reflect on contemporary developments and future directions and I'm sure it's in the mind of all of us that right at the moment regional developments are focusing everybody's mind very securely on current and future developments and the role that Australia Japan will play in securing the region's security and stability is particularly important the update the previous updates have looked at a number of different themes last year we the title was reinventing Japan and we were particularly looking at Japan's new directions this year we're carrying on in the same vein previous updates have looked at political and economic and social change and the very first one in 2013 we titled looking forward in economics politics and trade so you can see that there is a continuous theme underlying all of the updates the update will also be available on podcast for anybody who isn't able to be here and would like to see it that way or for any of you who want to go back and look at any of the fascinating discussion that we expect and it is also accompanied by a publication the quarterly issue of the East Asia forum is devoted to the topics that we're discussing today and you can pick up a copy of that at the front desk if you don't have one already a couple of points before I handle to the first panel we we have the foreign minister coming to give a keynote address and we have limited time for that she's obviously on a very tight schedule so if you would please come back from morning tea promptly when the bell rings so that we can fit in with her schedule we'd be grateful for that excuse me there is Wi-Fi available for anybody who is in the member of the university and the Wi-Fi password is not yet on the screen but it is available out at the front desk and we will give you that information if you require it the final point is that when we open up for Q&A please wait for the microphone to come around to you for your question because it's difficult in this lecture theatre as you've just seen to hear without without amplification so at that point I'd like now to hand over to the first panel and it's my great pleasure to introduce Marina clean to chair the first session on the Australia-Japan relationship as you will know Marina clean is chair of the Australia-Japan Foundation and was a senior officer of the Australia Department of Foreign Affairs and Trade and was ambassador to Japan and has held a number of other important senior positions in embassies around the region his role in Japan was coincided with the initial negotiations on the Japan-Australian Economic Partnership Agreement and of course he was there when the tsunami occurred and lead our help to Japan in the recovery from that disaster so Maria without further ado I'll hand over to you thank you very much Jenny and welcome to everybody today to this bracing canberra winter reminds me why I moved down to Melbourne to enjoy four seasons in one day instead of one in one day the as as Jenny has just said this is the first occasion that the Japan update has concentrated on at least one of the the major panel sessions on the Australia-Japan relationship albeit that on each of the five occasions that we've had the Japan update there has been elements related of course directly to the relationship it's there it's extremely timely and appropriate that this be the case because of the current developments that were all closely following in North Asia with obviously the young fellow up there causing a big a big amount of trouble for all of us and all of the countries of the region it does remind me of some other very very cold bracing moments that I spent up there in North Korea in January of 2003 and four respectively sent up there as a ministerial envoy to try and knock some sense into the about leaving the NPT and stopping the nuclear program and you can see how successful I was in that but the it was freezing cold I remember sitting in the equivalent of the Great Hall of the people there with my overcoats and scarf and four or five layers on because there was no heating having the negotiations with them as the chair of the Australia-Japan Foundation I've been terribly privileged to continue in a way to contribute to the ongoing development of the Australia-Japan relationship which I was directly involved with as ambassador from 2004 to 11 and the Australia-Japan Foundation really is an enduring aspect or pillar of the relationship that we have because it serves to ensure that Australia continues to invest in the relationship so that the depth of the relationship which is already very significant as we all know as well as very broad isn't taken for granted or treated lightly it absolutely needs ongoing investment in ideas and resources and today's session will certainly contribute to that this year we've also sponsored a very successful youth dialogue between Australia and Japan which is incredibly important we need successes to the generations of business people politicians and and academics and others who have been so instrumental in building the relationship over the last 60 years and I'm delighted with the quality and standard of these young people who are very keen and enthusiastic to participate in the relationship so I wanted simply to say a few words about the relationship in those in those few remarks I've made but let me say today we've got four excellent speakers who will each speak about aspects of the relationship sure I'm strong of course is well known to everybody here and has done a wonderful work in getting this whole Japan update institutionalised if I can put it that way over the last five years I've been delighted with everything he's done in that respect and the Australia Pan Foundation of course is very pleased to have been involved in supporting each of the Japan updates over the last five years Cheryl is increasingly engaged with the international academic and research community and as an excellent representative of the ANU and of course of Australia Pan Studies as well. Professor Ricky Curtin is a second speaker and she's Dean of the School of Arts at Murdoch University and she's been also very heavily involved throughout her career first as a diplomat and then subsequently as an academic both here at the ANU and at various other positions in Sydney University of Leiden and University of Tokyo and she is concentrating her research into Japanese history politics and security policy and foreign policy as well so this will be very important I think to hear her today we will have we're delighted also to have Professor Fumiyaki Kubol from the University of Tokyo who's the Hepburn Professor of American Government and history at the Graduate Schools for Law and Politics and with many other distinguished positions I had had the privilege of sitting next to him at a dinner yesterday evening and we had a very lively discussion about ongoing developments and I look forward very much to hearing him today. Dr Llewellyn Hughes will be the fourth speaker and he's Associate Professor at the Crawford School of Public Policy and he will be his research is principally about the energy markets and he's taught at the earlier School of International Affairs George Washington University Washington and he's been a research fellow at the consortium of energy policy research at the John F Kennedy School of Government at Harvard as well as a number of other roles so we've got a stellar lineup of people and I think this will be an excellent discussion so the plan today is that we will be inviting each of the speakers to speak for up to no more than 15 minutes so that we have some time possibly 20 minutes at the end of that session of the speakers presentations for Qs and As so without further ado, Shirai please. Thank you very much Murray that was a really kind and warm introduction and good morning everyone. So I'm going to talk about the economic relationship the bilateral economic relationship between Australia and Japan which I think is an important basis to start any discussion of the strong deep and broad bilateral relationship. The starting point in thinking about the economic relationship is a leadership from both countries that have been shown over the decades an innovation that's been shown in the agreements that have been signed that really kick-started the economic relationship in the post-war period. This year we're celebrating the 60th anniversary of the commerce agreement. I have a nice banner here. This was a very important agreement for Australia giving Japanese equal market access in our market most paper nation status in goods trade and it really helped secure energy supplies which I'll talk about to Japan raw material supply to Japan and helped fuel Japanese industrialization. Last year we celebrated the 40th anniversary of the Nata Treaty, the basic French Treaty of Friendship and Cooperation that extended that most favored nation status treatment beyond goods trade to investment and people-to-people exchanges and people movement. Kick-start a lot of things including the AJF as well as working holiday visas and has played an important role in the bilateral relationship. Australia and Japan were instrumental in the creation of APEC Asia-Pacific Economic Corporation that still endures today and is still an important venue for the region's leaders to get together. It brings the President of the United States to the region each year and I think is an important innovation from both countries and this couldn't have been done without the strong economic relationship underlying the broader political relationship of the two countries. More recently we've had the Japan-Australia Economic Partnership Agreement, the EPA and I'll talk a little bit about that later. That's been the most liberalizing agreement Japan has signed to date and an important stepping stone and part of the evolution of the forward-looking ambitious and innovative agreements we've signed. Thanks to these but more broadly thanks to the business communities in both countries and the thickened people-to-people exchanges the economic relationship is robust and strong and growing. So Japan is Australia's second largest trading partner, we have a $44 billion US billion dollar trade relationship between the two countries and Australia is important to Japan not just because it's third largest source of imports, ninth largest export destination but more importantly because of the natural resource trade and the energy supply and the raw materials. So I think a starting point for understanding the economic relationship is that Australia is a large and secure energy supply to Japan. Japan relies on 94% of the imports for 94% of its energy needs and Australia is by far the largest supplier and growing in importance. So in any energy good that matters outside of oil we are by far the dominant supplier. We're also the dominant major supply for strategic raw materials 61% of Japan's iron ore and the most recent data and over half of all other strategic raw materials so you name it Alminium nickel and so forth. And Japanese contracts, long-term contracts with the foundation of the development for the Pilbara and the natural resource industry in Australia more broadly. So I think this cannot be understated. Japan relies on us as a secure and stable energy supplier. You look at the other countries here that predominantly supply oil, not necessarily secure or stable and definitely not as secure as stable a supplier is Australia. We'll have Llewellyn talk a bit more about the energy dimension. Underlying that energy trade is the strong investment relationship and you can see here Japan has overtaken the United Kingdom as the second largest investor in Australia in terms of stock. So this is the accumulated investment over time and it shows the importance of Australia. So it's fascinating. Just a couple of examples here. Mitsui, the large trading company which I'm sure you're all aware of, invested $15 billion in Australia in the last decade which is more than it's invested in North and South America combined in that time. So we're an important investment destination and that goes to beyond just natural resources. We know of other high profile investments. Recently the Japan Post acquired toll holdings for $6.5 billion a couple of years ago. Kidding acquiring line Nathan for $3.7 billion a few years before that and then Nipon Life Insurance buying 80% of MLC for $2.5 billion. So anecdotal evidence like that would suggest the investment relationship is diversifying. It's growing in areas outside of just natural resources. So retail got unique on now in a few cities in Australia, beverage, food and beverage, distribution, logistics, insurance, finance. So it appears to be an investment relationship that's diversifying. Yet that doesn't really show up in the data yet. So this data is from the Bank of Japan. Australian data cannot tell us by sector by country. We either get aggregate by sector incoming investment or aggregate incoming investment by country. Luckily the Bank of Japan has a bit of a breakdown which I've aggregated up a bit. But it still looks like mining services and production dominate this investment relationship. So I'm involved in another project, tracking Chinese investment and I want to move on to tracking Japanese investment soon. So we have a much better picture of which sectors Japanese investment is going to and over time. I think we can get a more detailed picture of the important investment relationship. But the bilateral economic relationship is beyond bilateral, beyond naturally bilateral, sorry. And this is nothing new. So we import a lot of Japanese goods that don't come from Japan. Japanese branded goods from Southeast Asia and China. That's been an important feature of the bilateral relationship over a long period of time. Japanese businesses use Australia as a base for trade with Asia and beyond. Japanese investment in Australia doesn't just ship goods back to Japan, but to China and elsewhere. I think that's very important. Not to use Mitsui as another example, might think of some favoritism here, but was interesting how the CEO of Mitsui Australia came out during our Australia-China free trade agreement negotiations and pushed for and encouraged the bilateral agreement between Australia and China. And that's because they export, Mitsui exports more from Australia to China than it does back to Japan. So there was strong support for that. And there's also a lot happening already, but I think a lot more that can happen of Australia and Australian and Japanese business cooperating in the rest of Asia, given the closeness and the trust that's been built up over this long period of time. And we are in a highly integrated region. And we're both economically locked into China. So there's a lot of space for cooperation. Let me move on to the bilateral free trade agreement, the EPA that was signed recently. As I mentioned, this is the most liberalizing agreement that Japan has signed to date, made progress with agriculture. But I think there's still a little way to go. You look at this chart here that shows that we've, Japan's agreed to open up to Australian beef, removing tariffs that are just under 30% before the agreement was signed, and over 20 years moving to just under 20%. Now that's significant compared to every other agreement Japan has signed. But as a long way to go in terms of what we've managed to do with our other North East Asian neighbors, so China has agreed to cut to zero within 10 years and South Korea to zero within 15 years. So this came into force in 2015, and some nice negotiating by our DFAT colleagues meant that we got two bites of the cherry when it came into force, and you can see the big drop initially, which I think is a positive sign. It's a pity it just slows down a bit. Some important features, there was no investor state dispute settlement mechanism in this. This is a controversial part of modern free trade agreements that some in the community are strongly against because it allows companies to sue governments outside of the domestic legal frameworks. That wasn't included in this agreement. I think the Australian side and the Japanese side recognized the robustness and the independence of each other's legal system and rule of law. But the initial data on the Australian agricultural exports, which are a large part of this agreement to Japan, don't show an obvious kick up in exports. So you can see the red line here is 2014 export data and the blue one is 2016 data. Now I'll be the first to say that you can't rely on raw numbers like this because all sorts of things move, exchange rates move, other countries, other agreements are signed. So we need to do a proper robust counterfactual to be able to measure the effect of the free trade agreement. So I've already thrown out a few topics there for PhD students to measure this to get a better idea of the third party country economic relationship that beyond bilateral and thinking about the investment relationship. I want to finish off with a couple of slides on what's underdone in the relationship. I've talked about some of the highlights, some of the strengths of the bilateral relationship. Well, a major weakness is the lack of Australian foreign direct investment in Japan. Now this I think we heard last year from Jason Hayes from PwC who spoke at the update. For those of you who remember he blamed both sides, which I think is a fair, fair call. Japan's relatively close to foreign direct investment. That's changing recently and changing rapidly, but it's still a long way behind. Japan still ranks close to dead last. I think dead last in the OECD in terms of FDI stock as a ratio of GDP. But also Australian business is very risk averse. So our Australian business investment in Asia pales in comparison to Australian investment in New Zealand, the United States, United Kingdom. And considering this is where the growth is in the world, in the global economy, Asia, I think we need to start to work on that as a country generally, and we have a responsibility as a university. That's where this deep trust and understanding between the two countries I think is a great starting point for this. And I think this story is consistent with where both our economies are heading. So part of opening up to foreign direct investment is part of the third arrow structural reforms of others, our binomics agenda. And it's also consistent with where we want to take our economy out of an over-reliance or heavy reliance, I shouldn't say over, heavy reliance in the natural resources industry towards a more higher value-added services manufacturing economy. I'll finish very quickly on interest in the global economy. Our economic relationship was already strong, was already deep and broad before our EPA, partly because of the agreements we signed earlier, but those agreements afforded MFN status and really underpinned what was already there, which was the global system. So as the gap and later the WTO, and that's the framework that's brought trade and investment in our region amongst countries that didn't have and still don't have bilateral trade agreements. So that order, rules-based economic order was created by the United States and underwritten by the United States in the whole post-war period is now under threat from an uneven and slow recovery from the global financial crisis and actually to be blunt, Trump's America. So Trump's America is now a threat to this system that they created and underwrote. So I think this is a time for Australia and Japan and other open economies that rely on the global trading system to work together and form coalitions of open economies to really hold the line, if not push further in liberalisation when we need to. Okay, thank you very much. Thank you very much, Shiro, and also for keeping to the time, Shiri. Well, Ricky. Oh, sorry, it should be kubble. Well, it's just that this is Ricky. Sorry, sorry, okay, this. Sorry, please, for me up here. It's a bit confusing. Thank you very much. Thank you so much for inviting me at this very important prestigious event. Thank you, Peter, Shiro, Joe, and Iboni. And thank you for the generous introduction. I got the invitation last year, but I couldn't make it. I'm so glad that I'm finally here today. I asked to talk about the diplomatic and security relations between Japan and Australia, which is really an exciting topic, especially now when the security environment of Asia is really tense. From Japanese perspective, any country where cars run on the left hand side of the street is a country of advanced civilisation. Besides, we have really intimate first economic relations which Shiro elaborated upon in detail. And we have more and more intimate culture and people-to-people exchanges described in number three, which is also very impressive. We still recall that we received generous help from Australians in March 2011. However, we can find more dramatic changes taking place in a bilateral relations in the area of diplomatic and security relations in the past decade, especially in the past five or six years. So I will start by mentioning the joint declaration on Security Corporation of 2007 made by Prime Minister John Howard and Prime Minister Shinzo Abe. It started many concrete things that helped cement the trust between our two governments and perhaps between two militaries. Many things which I skipped, but these are the basis for the cooperation which is coming later. But things got momentum since 2013. There are a couple of reasons for the two governments to strengthen the security ties. First, Shinzo Abe came back to power in December 2012 with more 34 policy agendas. Second, there was also a change in power in Australia, too, from Labour to Conservative Coalition in 2013. Third, and most importantly, the security environment was getting very tighter and more tense in this period in Asia Pacific. China's infringement of Japan's territorial waters in the East China Sea happened first in 2008. And in 2010, there was a crash in Senkaku or Daiyu area. The conflict over the island became even more serious in 2012. The activities of China in the South China Sea, such as the reclamation, the construction and the militarization, also became a salient international issue probably from 2014 to the present time. Japan used to see this issue, the South China Sea issue as a different one from the East China Sea problem. But nowadays, in Japanese perspective, they are the same problem. It is an attempt to change the status quo unilaterally by force. And Japan came to feel that it shares the same perspective with Australia, especially for the South China Sea. Of course, it needs to say North Korea is a serious problem. This is also a case of a challenge to the international community. So in 2014, the special partnership for the 21st century was declared by Abe and Abbott when Abe came to Canberra. By 2014, there are already a bunch of remarkable concrete outputs, such as new access, information security, agreement, and the agreement concerns the transfer of the defence equipment and technology. And this growing convergence was not the product of a single transaction or a pair of leaders, but converging interests, which include but are not limited to a shared concern about rising China, as well as shared values, including democracy, the rule of law and free markets. Here, I would like to emphasise Japan's broadening partnership for international security cooperation. There are cases of progress of an important magnitude and speed, which are relations with UK and Australia. Just May was in Tokyo just last week, and now between Japan and the UK, there are there are plans for joint exercise. And even the UK's participation in the operation of a freedom of navigation by their new carrier might be a possibility. And that would be a great help for the region and for Japan. And Japan and Australia are working hard to help the so-called palm countries, the Pacific Island leaders are meeting. They are a very important country for your country and for Japan, too. So we see here, Japan and Australia share the same perspective on almost all the important security issues in the Pacific region, like North Korea, South China Sea and East China Sea. These are things that happened just two months ago or last month. And since coming back to office in late 2012, Prime Minister Abe achieved many things that had been floating in the Japanese politics as agendas, but had never been realized. Many of them are taken for granted in other countries, but Japan has been exceptional. The politics has been extremely fast. And this is a partial list of his records. You can also add the GDP to this list. And look at how we are spending for defense. And it's still within the 1% of the GDP, but in the last five or six years, it increases pretty fast by our standard. Inevitably, in and outside Japan, Abe has been criticized, harshly, as a dangerous, right-wing nationalistic leader. Any small steps, any minor deviation from the conventional policy of Japan has been viciously attacked. He also went to the Yasukuni Shrine in late 2013, which fueled anti-Abe feelings. But by the Japanese standard, he's certainly a little bit more conservative and hawkish than his fellow politicians. But is Japan going back to the 1930s and militarism, as some would like to say? And my answer is no. If you look at Japan to various standards, various lenses, like the legal framework, like constitution, or a lot of national security legislation, or to public opinion, or actual behavior or policies, you must come to the conclusion that this country must be still a very and probably too much pacifist country. Very often, foreign observers of Japanese politics and history fail to look at Japan from a meaningful, comparative perspective. This is because they tend to read only writings by liberal or leftist journalists or scholars in Japan. Some say that young stars in Japan are becoming nationalistic. But look at the poll in this part. We are going to fight for the country. Only 11 percent of the Japanese said yes, and this is the lowest among 64 countries pulled by Gallup in 2015. Only 11 percent. Probably in your case, 60 percent would say yes. And this is a poll by the Cabinet Office of Japan. Will you join the Self-Defense Force of Japanese and military to fight if Japan is attacked and only 66.8 percent of Japanese say yes? And you know, it's interesting that, you know, there's an image of the young stars in Japan are more nationalistic. But actually, you know, senior people say more, you know, affirmative. And young stars say just they escape. So when Japan fights, it does with senior volunteers army, which might be strong because they are not afraid of dying. But the point here is to what extent can Japan liberate itself from these many constraints? And it is true that Japan is now changing. I tend to think that Japan has not fully utilized its various potential resources for national security purposes. They have been overwhelming political hurdles until recently for them to be mobilized. Here I mentioned, first, our defence spending is still below 1 percent of the GDP. It's about 2 percent. In the case of Australia, it's 1.2 percent, even with the New Zealand or Germany. And our consumption tax rate is to 8 percent whereas the European standard might be like 15 to 20 or even 20 to 3 percent. And our space policy might be what I'm mentioning because it has undergone pretty radical change from pure scientific research to a more national security oriented program. It has changed to place in early 2000. Now Japan incorporate its space policy as an essential part of national security strategy. And as in the case of submarines, we sometimes have a good technological capabilities. The case of this quasi-satellite, quasi-zenit satellite might be interesting for Japan and Australia because they cover Japan and Australia at the same time and they will make up for the weak spots of the GPS by the United States. This has a resilience aspect as well as deterrence function because if any country destroys the US system, there's still Japan's system in place in certain parts of the world. And it says I mis-spelled it. Four satellites will be coming not in 2018 but actually next month, October 10th. So things are moving pretty fast. After all, it is important to remember that it's up to the leadership of the Japanese politics whether Japan can fully mobilize its resources. And we Japan and Australia naturally share many concerns ahead. How to confront North Korea and China would be chronic problems. How to forge a united front against China is another difficult issue in almost every country is economically interdependent with China and inherently related with this problem is the problem of to what extent a country can get tough with China in security areas given the large degree of economic interdependence. The new problem might be as the United States for the short term arise have to detect two intensions of the Trump administration in the deluge of president's impulsive treats. For the long term, we have to be prepared for the United States to be even more inward looking in the coming years. Still the most serious concerns might be from Japan's domestic politics, which is still very or too much pacifist. Others approval ratings became weaker in the last few months, though we saw some turnaround last month. In closing, you know, I would like to say this, but if there's no Australia for Japan, you know, if there's no continent or this place is inhabited by totally different people, what if there's no Australia? Of course, Japan will lose a crucially important partner who could, you know, stand up with Japan for the rule of law, you know, for the maintenance of the current international order. Then I have to ask you, what if there's no Japan? Of course, definitely you lose a big customer for your natural resources. You also lose a good place for skiing with quality food and hot springs. But hopefully, you know, you might feel that you lost a potentially, potentially powerful partner who'd stand out to to maintain the current international order based on democratic values and mutual trust. My sense is that we share so many interests, and bilateral relations are now so mature and deep that we can make our relations even more solid than ever before. There is a reason I guess for our strategic partnership to be called special, which also suggests a new direction, new direction, which is the major theme of this year's Japan update. Thank you very much for listening. Thank you very much, Professor Kubol. That was a very entertaining and very instructive speech. Can I ask Professor Ricky Kirsten now to speak? Yesterday when I called my office in Perth, they told me I sounded like the female Darth Vader. I'd like to give you apologies in advance. I am a recovering person from laryngitis. I think I can last 15 minutes. Let's see how we go. So today, I'd like to talk about especially the Australia-Japan security relationship with a particular focus on how the Japanese bid for the future submarine in Australia, the Saudi submarine bid, what this showed us about underlying assumptions that each nation has of the other. I am not arguing here that the failure of the Saudi bid seriously destabilized the bilateral relationship. I think it did not. But what it did do was reveal these underlying assumptions that we have of each other. And I think we need to take that into account as we address future issues that arise to challenge the relationship. It seems to be a picture missing from there. I didn't do that. So I would say, I know disruption is a very trendy term, but I think the Australia-Japan relationship is currently facing a degree of disruption or at least a jolt, a catalyst to reconsider what we have been assuming since 2007. In other words, since the signing of the joint declaration, we've been on a steady trajectory of institutionalization and trust building with a strong focus on practical cooperation between the two countries right through to the present. And I see no reason why this would not continue. But as I said earlier, the Saudi Submarine bid was fascinating to me because the discussions that took place in both countries, especially in Japanese Parliament, in the more informed media outlets in both countries, and even within the bureaucracies in both countries, showed us what we were projecting onto the relationship. And in large part, the Saudi bid's failure has caused us to question those assumptions. And I will go into more detail about those assumptions later. The key thing is, when we were considering purchasing the Saudi Submarine, it was a catalyst for a debate about whether this would make an alliance relationship between Japan and Australia desirable or unavoidable or even necessary. So that is a significant upgrade to the current security partnership that exists between the two countries. And it's this word alliance that triggered what I can only describe as great dissonance in perspective between Japanese views of the bilateral security relationship and Australian views of the bilateral relationship. So even though the relationship remains steady and strong, there was a bit of a job saying hey, maybe we don't see things the same way after all. And two other elements that I think are interrelated are the advent of the Trump Administration, particularly significant to Australia-Japan security relations, because as much of the literature argues, it's the trilateral logic underpinning the bilateral relationship that makes that bilateral relationship matter in security terms. So if the Trump Administration is taking a new direction and new emphasis, or even if we can say that the liberal international order may be looking slightly less liberal, this is going to affect where we position the bilateral security relationship. And Abe also needs to be taken into account because he's experiencing quite a jolt domestically at the moment. Successive scandals have weakened his domestic political base, and even within his own political party, and I think it's quite possible in this context of a DPRK nuclear threat, that Abe will look to Australia for concerted statements of support, if not action that represent a demonstration of support for Japan. There's an increased desperation and need on the part of Abe. So I think these are the three things that we might argue are disrupting that nice, steady trajectory that we've been having since 2007. Now the trilateral logic behind the bilateral relationship, it's pretty self-evident. You'll see over and over in the literature, Japanese and Australian analysts saying that the Australia-Japan relationship is the most developed security relationship that each nation has with any other apart from the U.S. That's how developed this security relationship has become. There's also a strong commitment on the part of Australia and Japan to step up to use the terminology to become fully capable, fully interoperable members of the U.S. alliance system, and an enhanced bilateral relationship is a strong demonstration of that commitment. Australia and Japan want to keep the U.S. engaged in Asia, and at the same time an enhanced bilateral security relationship between Australia and Japan is a hedge against a possibility that the U.S. may be less engaged in Asia Pacific in the future. So the argument is it's the U.S. that makes Australia-Japan security relations matter, and that's why we need to constantly scrutinise whether the direction being taken by the Trump administration might derail or alter the perspective that both nations bring to this very positive security relationship. There is a bilateral logic to the Australia-Japan security relationship. These are just some key words that demonstrate that. We facilitate each other's contributions globally and regionally, whether it be the East Asia summit or the UN Security Council. We are each other's best advocate. There's complementarity in policy terms. Particularly noticeable is the capacity building efforts in the security realm in Southeast Asia. Australia and Japan are working in a complementary manner to enhance individual Southeast Asian nations' capabilities in their current threat environment in a very effective way. I've already discussed interoperability. That is enhancing military exercises between Australia and Japan have increased dramatically in number. With the AXA, as Kubel sensei pointed out, the revision of the AXA is only going to increase and become more meaningful. You can argue there's a real public good attached to this bilateral security relationship. That's humanitarian assistance, disaster relief, it's peacekeeping. But that's non-traditional security. If we return to this question at the Saudi Submarine bit, what was different about that issue was that it confronted policy makers in both countries with the prospect of moving more decisively into the realm of traditional security cooperation. That's the big deal about this matter. Minilateralism, we've seen it in nuclear non-proliferation, in climate change. The bilateral dimension that benefits the dividends of the bilateral relationship are also global and regional in nature. It's not just entirely dependent on whether the US approves or is involved, for example in the trilateral strategic dialogue. When we talk about the submarine, we know so confident were the Japanese in the early stages of this process between 2014 and 2016 that in Japanese bureaucratic circles it became known as the Goryu bit rather than the Soryu bit, so the Australian dragon was the name of the project in the Ministry of Defence. And on both sides, many people assumed that Australia purchasing Japanese submarines was the logical next step in this trajectory that had been so impressive since 2007. Didn't seem odd to many people at all. It seemed logical. It reaffirmed how both nations regarded their role in the US alliance. But crucially here the political benefit to the Abe administration really was attached to this bit. It would promise to rejuvenate the defence export industry of Japan in a tangible way that was not directly associated with the US alliance that Japan has. So it was stepping away and in a manner of speaking it was a little bit more of independent stepping away from Japan-US tight embrace. A bit more of independent action. The hard edge that would be attached to this kind of major defence acquisition in Australia was very significant to Japanese commentators and analysts. It did signify a significant transition towards hard security as opposed to soft or traditional as opposed to non-traditional. Politically, domestically, Australia being the partner for such a major acquisition that would last 30 years in duration would be provide great affirmation to the proactive pacifism policy of the Abe administration. So if I talk about the assumptions it's not going to let me do that. Oh yes, there we go. So Australia had certain assumptions about Japan that an empowered and capable Japan is essential to regional stability that a normal Japan would be important in a multi-polar Asia but clearly Japan would expect Australia to choose sides when it comes to China. There was also an idea that in the view of third parties, Australia working in partnership with Japan would moderate Japan's behaviour and because Australia is not the US it lends this positive pattern to that development. But it was very clear in Australian commentary that the prospect of the Saudi bid being successful would lock Australia into an alliance with Japan for 30 years and that this was completely unthinkable and undesirable. Australian commentary turned against the prospect of an alliance with Japan and this was the context in which the Saudi bid was unsuccessful. It's not the reason, it's the context within which that happened. So there was an entrapment fear and in terms of what Japanese thought of Australia commentary in Japan was awash with a quasi-ally language. Australia's already a quasi-ally, why wouldn't they choose us? There was an assumption that the US would force Australia for strategic reasons and alliance reasons to choose Saudi. That it would have nothing to do with cost or Australia's needs or operability it was, Australia would fold. There was that expectation and Japan did assume that Australia could get too close to China and Japan could perform a valuable role of preventing Australia getting too close to China but the real crunch was that in parliamentary debates in Japan and in analysis there was a strong view that Australia could not be trusted with the dual in the crown technology of the Saudi submarine and that if it was going to proceed it would have to be a black box build or a spec down bid. Very clear line of argument in Japan and there was a political argument running counter to that following the lack of success of the bid that in not choosing Saudi, Australia was effectively saying that it did not support Japan's China policy and I can elaborate on that. And my final slide, Marie my voice is holding up So I'm not saying the Saudi bid's failure destroyed the relationship, it didn't but it did disrupt it. We're going to see continued build up in military exercises with increased pace and frequency between Australia and Japan but we must remember that Prime Minister Abe burned considerable capital getting Japan to a point in a legislative sense where the Saudi bid had it been successful would have had a proper political context. The dissonant views that were exposed I think are significant and bear scrutiny from all of us who favour this strong security relationship and I want to point in particular to the reciprocity gap. In Japanese commentary on the failure of the Saudi bid there was a line of expectation revealed that I think emanates from the July 2014 cabinet resolution on collective self-debates that Japan would come to the aid of countries in a close relationship with Japan. Australia was frequently mentioned in parliamentary debates as such a country I think there already exists an expectation of reciprocity on Japan's part from Australia and that there is not yet that degree of reciprocity existent in Australia about Japan coming to its aid. I think this is significant and finally to end with the Trump administration if the liberal international order is going to become less liberal what does this mean for the rhetoric and the logic and the impulse behind Australia Japan's security relations. It's all about liberal internationalism, open markets, free trade, rule of law. We see it in all of the documentations it's not just rhetoric is it. But this is the context we currently face and I leave you with that question thank you for listening to the theme of El Darf Vader. Thank you very much Ricky that very thought provoking presentation. Can I now ask Professor Llewellyn who is to speak? So I feel like I should do this presentation with El Darf Vader just to continue with the gag from the last presentation. I've been asked to speak a little bit to give you an update of what's going on in Japan's energy picture and the relationship between Australia Japan. Let me first begin by echoing Murray McLean's comment about the Australia Japan youth dialogue which has recently been put together. I had the opportunity to meet with that group and it's really a terrific group of people across different sectors of Australia both the private sector and also within government and elsewhere who had the opportunity to talk over key issues in Japan and Australia and Japan's relationship. I was only somewhat wistful because I've obviously clearly graduated from being on the other side of the fence doing the presenting. The other point I wanted to make just to begin was to note that a second initiative has recently been put in place that helped strengthen the Australian and Japanese relationship. That is a new double degree that exists and is being newly created between the Graduate School of Public Policy at the University of Tokyo and the Crawford School of Public Policy at the ANU. It enables you to spend a year in each country, complete classes at both institutions and receive a master's of public policy from both institutions. So it's a new initiative which has begun this year. If you are interested in doing an MPP, if you have friends who might be interested in doing an MPP, I would encourage you to take a look at that opportunity. Okay, so let me talk a little bit about the energy space. So as Shudo pointed out earlier, it's really difficult to begin a conversation about Australia and Japan energy relations without starting in terms of trade and investment in the natural resources sector. Shudo has already made this point so I don't want to spend a lot of time in it, but Australia really is a key supplier of mineral resources which obviously energy is extraordinarily important and that is focused particularly within natural gas as LNG and also within coal. Oil less so but that's partly because Australia doesn't export a lot of oil, in fact we import quite a lot of oil and products. The second part of it though, and I think this is an interesting part in terms of the nature of the relationship, our focus is on investment. Japan doesn't matter only to Australia and vice versa because of trade in these products, but inward foreign direct investment from Japanese companies into Australian resource, energy related resources is really large. The graph that you can see behind me focus on the Japanese trading companies and their investments within Japan, but I also want to focus on the role of INPEX and also JOGMEK, Japan Oil Gas and Minerals National Corporation. JOGMEK is a finance, both of exploration work and also development projects and provides financing to a number of these companies as they develop projects within Australia and elsewhere around the world and they're tightly tied to the national goal of Japan's energy policy which is about diversification of supply and also diversification of fuels. INPEX is owned by the Japanese government. Just over 18% of its outstanding shares as well as a golden share are owned or retained by the minister for economy, trade and industry. And so you can think about INPEX as a quasi national oil company in Japan. And INPEX is also significantly invested in Australia as well. It's invested as an operator in Western Australia for this project. It's invested in Darwin and it's also invested in a floating LNG project which is being developed and operated by Shell. So I think that these kinds of initiatives and the fact that INPEX and JOGMEK are heavily involved in them really underlines how important Australia is as part of Japan's broad strategic energy policy in and around natural resources. It's not only about trade but it's also about that core role in diversification that Australia is able to provide. Now in the spirit of today's theme for today which is seeking new directions, we have a panel on innovation later. I wanted to spend most of my time talking about what opportunities might exist beyond this. The resource projects I showed you, 20-30 year projects, that relationship will continue often to the future and it's fairly predictable. But I want to argue that Australia and Japan actually have a lot of shared interests outside of the resource sector in the energy space. And that comes from I think a couple of different areas. The first of those is that both Australia, Australian governments, both the federal government and the state level and the Japanese government are wrestling with very similar problems particularly in the electricity sector. So what you can see here is slightly outdated figures and I apologize for not updating you. I can promise you the line keeps going up. Showing you the installed base of renewable energy production in Japan. In 2012 Japan mirrored Germany in introducing a feed-in tariff. And it's had a pretty extraordinary effect on increasing installed capacity of renewable energy within Japan. You can see that here, and this is broken down by renewables renewables itself. If you look at that in terawatt hours, that is how much electricity is actually being generated within Japan using renewables. That picture is shown for you here. You can see renewables at the bottom. That looks small. But remember this has started from a very small base and you can also think about for example in the fourth quarter of 2016 renewable production in Japan reaching almost half as much as thermal coal in its role in generating electricity for the Japanese industry, for households, and for the commercial sector. Now like Australia which has seen significant falls in system prices for renewable energy, that has meant today the Japanese government is having to deal with a whole range of what I like to call secondary issues around integrating renewable energy with the electricity grid to give you an idea of just a few of a couple of those. You can see here a picture of on your left I guess of the wind power sites which are being developed in Japan. Actually one of the funny things about Japan's renewable energy sector is it's heavily weighted towards solar thought of all takes at the moment and the government is interested in pushing wind pretty significantly. And you can see the wind power projects here. The problem of course if you look on your right here is you can see what Japan's electricity grid looks like. Much like Australia, Japan's electricity grid was really determined by the service areas of its power utilities and that means there are significant constraints between each of those service areas that the utilities used to provide which makes it very difficult managing the incorporation of renewable energy into Japan's electricity grid. That should sound familiar to you if you've been following what's been going on in South Australia and Australia's energy debate as well. And the regulators in Japan are going for a whole range of different discussions much as we are here about what to do about that. So Hokkaido Electric has run a three year pilot program which has looked into how effective grid side battery storage is for example in managing intermittency issues that you find with the incorporation of wind power into Japan's electricity grid. That should sound familiar to you if you've been keeping up with Elon Musk's recent announcements about battery storage in Australia. This just shows you another area in which the Japanese government is dealing with. Up until now if you wanted to plug a renewable energy project into the grid in Japan you negotiated with the utility about the costs and the location of connection and so the government is trying to lower the cost for renewable energy developers, in fact all new energy developers, by introducing a tendering scheme so that multiple companies can bid in in order to share the costs associated with interconnection to the electricity grid. So there's a lot of kind of regulatory innovation which is going on associated with this transition to a less carbon intensive electricity grid which Japanese regulators are dealing with and which Australian regulators are dealing with as well. I'm a student of comparative public policy I believe that lesson learning is an important thing that governments can engage in with one another and it strikes me there's an opportunity there to have a conversation around those kinds of issues which are shared issues for both governments. The second problem that the Japanese government is dealing with in terms of renewable integration is household costs. And also as I said are shifting the ratio of solar photovoltaics as a part of all of the renewables introduced in Japan to try and promote wind, biomass geothermal, other sources of power. This shows you their feed-in tariff rates that were announced or became operative I should say in terms of April 2017 and they've done a number of different things to try and make particularly wind more attractive to foreign direct investment. In fact there are quite a number of foreign firms which are non-Japanese firms which are invested in the wind power sector in Japan today which have seen these kinds of changes and are interested in taking advantage of them and I'd like to see Australian companies do that too. What they've done here is showing you is that particularly for wind projects for others as well, biomass and geothermal, that feed-in tariff rate has been locked in for three years. Now the development of wind takes quite a bit longer than solar power because of the environmental assessment process but this is a key way in which the government is trying to provide certainty on returns to companies which are investing in wind and geothermal and in biomass as well. So there's kind of a lot going on here and there's really a lot of investment and excitement about these changes that are happening. I would be remiss without talking about Japan's stellar role that is played in helping push technology that is decarbonizing the transport sector. This is something that really Australia is quite far behind relative to many other OECD countries. What you can see here is the number of fast charging stations in Japan that is they're charging to about 80% of Nissan Leaf's battery charge in 15 to 20 minutes and it's called Chademo. The reason it's Chademo is a play on words because you can as you're waiting for your Nissan Leaf to charge for 15 minutes at the charging station. So you know Australia, I saw Josh Feinberg talk last week in Melbourne who was talking about that the EVs were a likely future part of Australia's energy picture and it strikes me that Japan has a tremendous amount of expertise both in a regulatory sense and a technical sense in and around electric vehicles and fuel cell vehicles as well which could be shared both at the government level but also at the private sector level between the two countries. This is my last slide so I thought I should finish with a couple of different things firstly to let you know what to look out for so as I said this is a moving picture just as you see in Australia the government in Japan has problems like the Australian government in providing certainty over time. In Japan of course that's because of the nuclear restarts issue which you'll notice I haven't talked about and what the government is doing right now is going through a process within the Ministry of Economy, Trade and Industry of thinking about what the targets for 2030 and importantly actually the targets for 2050 should be in terms of the share of different fuels within Japan's electricity sector. Now the government has quite a bullish view on the role of nuclear you can see here I think 22 to 24% of generated electricity in 2030 but there's a lot of analysis out there that suggests that that's an overly ambitious target and so the question becomes what role would gas play for Australia particularly what role would gas play and what role will renewables play in making up any potential shortfall from the lack of the lack of nuclear power. I expect that by the end of this financial year that the government will have made some announcements around this because it's part of what's called the basic energy strategy let me finish by making a point about another initiative that I'm involved in. Some of you may have seen that our Prime Minister Turnbull in Germany recently announced an energy hub, the Australia German Energy Hub which is an initiative which the ANU and the University of Melbourne are jointly managing on the Australian side and it has support from the Department of Foreign Affairs and Trade and elsewhere and the idea of that is to talk about shared issues within the energy space. What is it that the German government and the Australian government are dealing with together as you think about decarbonisation and innovation and other kinds of issues and it's quite an exciting five-year project. I'm really looking forward to participating in that but my point is that I feel that Japan and Australia could be doing that too. There are a lot of shared regulatory issues that the two countries are facing. There are also I think opportunities for the kinds of investment that should be talked about wanting to understand more about that is on a sectoral country basis. What kind of investment is coming from Australia into Japan and vice versa already outside the natural resources sector in energy and what more could be done to help facilitate that as governments, as tractors, as academics and also as the business community. So I'll stop there and thanks for your time. Well thank you very much Well and could I ask the panellists please, the speakers to take this. Here at the table I'll stand up and we've got a bit over ten minutes for questions and answers and I can see many hands up already. So Dr Evans here. Please announce your name and your affiliation as well. Thank you. Bronwyn Evans CEO, Standards Australia and member of the Australia Japan Foundation This question is for Dr Armstrong. I was struck in your presentation when you talked a lot about business, but one of, there's been a lot of discussion in Australia about the importance of business leaders having Asian literacy and I wanted to just very specifically target Japanese literacy in Japan for business leaders in Australia. What are those essential elements and how indeed do we develop them? Sure, well that's a great question and I think to be honest the agenda that we need to follow was laid out pretty clearly in the Australia and the Asian Century white paper. That wasn't just for Japan but that can tell us what we need to do. Language training is a start especially in a country like Japan given the lack of experience compared to a lot of other countries in our region. But beyond that spending time in country, we have a lot of that but there's still this hesitation to really invest and put our money where our mouth is in Japan. So in country experience and deeper understanding and knowledge of the country. Thank you. Thank you. Good morning. Ryuto found the time mission. This question is for Professor Kubo and Professor Kirsten. Could you please comment on the possible actions of Japan and Australia in the case of the military conflict in the Korean Peninsula. Especially in light of some different opinions over the military government in these countries. Thank you. Professor Kubo. Thank you very much. Very important but very difficult question and the answer would depend on what kind of military confrontation happens in the Korean Peninsula. That would be large scale normal type of war that primitive attack by the United States. So you know the Japanese response would depend on that kind of phenomena things. But generally speaking Japan now has security legislation that would make it possible for the government to dispatch the Japan's self defense forces to fight alongside with the United States. So this would be a great help at least for the United States military. But in a very indirect way. Still there should be a help for the South Korean government too. And of course there will be a great help to the Japanese government and for now Japan is talking about having little bit more anti-missile capabilities like introducing so called Aegis or having there is an ongoing discussion whether Japan should have counter-strike capability which is still very controversial in Japan. I think this is where we might for the first time see what the real consequences are of the weak link if you like in the US alliance system between Japan and South Korea. This is where it really might finally become very evident to Japan and Japanese leaders regardless of any other issue that a strong security relationship between these two countries is absolutely essential. And we do not have that right now. I think that's a concern. Ultimately the US is key. What the US does I think will determine largely not exclusively whether Japan and Japan might respond. If there is a coordinated response it's going to be I think effective given how much practice Japanese and Australian forces have had albeit in non-traditional settings disaster relief, peacekeeping etc. Still there have been a lot of examples of effective coordination and I would expect that to be more of a rear guard even an intelligence based one rather than a front line troop commitment one because I think this conflict is not going to be clean. The other issue and of course North Korea is depending on this we might find out for the first time whether the missile intercept system as Kubo sensei said currently sea based maritime based in Japan not land based we're going to find out possibly whether it actually works or not and the demonstration effect will be huge whether it does work or whether it doesn't work. Hello my name is Cameron Noble from the Japan section at DFAT I have a question for Dr Hughes in your presentation you talked about the emerging energy mix in Japan but I'm just wondering where hydrogen fits in that because we had a visit by a Japanese parliamentarian a couple of weeks ago and she's the chairperson of a building a hydrogen society within the LDP and Japan has labelled the Olympics as the hydrogen companies. You know Toyota and Honda developing the hydrogen fuel cell cars they're going to be rolled out even in Australia in the 2020s a lot of research happening even at ANU at the school of engineering here so there's a lot of energy being put into that and obviously Australia has a lot of potential to make that a new source of income with the brown coal even it can't be the brown coal can't be used that it has traditionally but there's opportunities there to convert that brown coal into hydrogen using new technology so I'm just wondering how you see that and also currently obviously at the beginning of your presentation you showed how much Australia is exporting to Japan in terms of coal and LNG. I'm just wondering how Japan's changing energy mix will change Australia's contribution to that new energy mix and what are the opportunities for Australia to contribute to that. Thank you. Great, thanks for the question. So hydrogen is really interesting and I'm excited you asked the question because I think it's one of perhaps a basket of potential issues over which a deeper understanding of what the opportunities might be where they lie. So the key area within which hydrogen has been proposed to play a significant role is within the transport sector and there are some areas within which that competes with alternative technologies so particularly with battery electric vehicles and lithium ion batteries obviously a large market share of that is held by Panasonic and that particular technology is pushed by Mitsubishi by Nissan and by Honda as well which is kind of having a bet each way. On fuel cells Toyota is really the strongest backer of fuel cells in fact Toyota is invested in battery electric vehicles but I just read the CEO saying yesterday once again that he did not see a long term future for transport in lithium ion technologies because he doesn't think that batteries are going to progress as fast as people expect and that fuel cells will be the alternative. So there are other areas as well right so in other areas of transport and trucking for example long distance transport in which batteries might not get the job done fuel cells can play a role and hydrogen can play a role in that and also within households themselves. And I think in households as well you see competing technologies some of the big Hitachi and other companies develop energy management systems which are built around the lithium ion battery and electric vehicles but you see competing technologies which would also be reliant on hydrogen so I think to round that off I would say that the picture is not yet clear that there are industrial consortiums which are on the sides of different technologies but hydrogen has a significant as you noted there's a significant segment of Japanese industry and also in Parliament which are supportive of the idea of a hydrogen society moving forward and that would obviously be a potential opportunity for Australia. In terms of the changing energy mix so the big question I think revolves around nuclear restarts in terms of Australia's short term interests to the extent that nuclear plants are not restarted they need to be replaced by something there are something like 42 units of thermal coal which have been announced by Japanese IPPs and by Japanese utilities and you know analysts differ on whether those are likely to be built or not but if it's not coal then you know it's likely to be some mix of gas and renewables so I think that would be my preference obviously and you know I think that provides obviously opportunities for Australia as well and there are a lot of changes in gas markets that help that happen with flexibility around contracts in gas markets which enable you know more shifts in volumes associated with those contracts and that's something that you know Australia will be part of as the Asia-Pacific gas market changes Thank you very much Peter, we might have to make this the last question A question from New Ellen and Shiro but let me just congratulate the four panellists on what has been I think a tremendously substantial and thoughtful contribution that they've made to this question. You know we've got our own self-made energy crisis here and in view of the nature of the energy interdependence between Australia and Japan that Shiro and New Ellen have described and the huge transformation that's taking place in the energy scene in Japan and across the region in China and elsewhere do you see value now in initiating substantial high level I mean leaders level dialogue on energy transformation that is Australia Japan initiating such a dialogue in the region Let me have a quick go and then Lou Ellen can answer it. I suspect you have an answer to that question yourself Peter but I think that is why we matter in Northeast Asia when it comes down to it it's our security of supply and how important that is for political security in Northeast Asia when we have our own crisis here and we intervene in the market it never works out well for anyone when we intervene in the market we can get severely punished and undercut our own security of supply so as we in Australia as well as in Northeast Asia and elsewhere go through these very big changes in energy mix I think it is important to have dialogues at all levels including at the leadership level so there's a bit more forward planning and signaling and cooperation around these issues quick response from Lou Ellen I think that the is there an opportunity to have deeper dialogue yes the question around timing of when to do that and at what level to do that is an interesting one so often when I think about the energy climate relationship for example and the United States is another case here where energy is highly politicized that there are ways that you can engage in dialogue which don't push the buttons that lead to politicization of the issue I think it's certainly the case that in the energy climate space there are tremendous opportunities for cross-border investment we have representatives from the standards authority here in Australia there are a whole host of standards related issues with the charging of electric vehicles and so on and so forth working level but very substantive discussions that potentially could occur what those opportunities are and where they look like I think need some scoping right so you can identify those areas that would most likely be fruitful but in general terms you know yeah sure I'm bullish about that would you like to come in and talk about this subject at all? I'll ask one last question and that will have to be it thank you I've got a couple of questions one for Professor Kirsten which is essentially your idea of the logical next stage from non-traditional to traditional security is something that doesn't have a constituency in either domestic situation Australia or Japan and so in a sense that was what was articulated by Professor Kubo in relation to the reluctance for people to participate in traditional security so I was wondering what you are thinking that might trigger that and this has been talked about for some time and the other question I have is for Professor Kubo which is in relation kind of a bit outside the Australia-Japan relations but it's to do with maritime security and that Japan has been trying to promote relations with Vietnam in the last few years that it sees perhaps greater security for women within the region I'm saying within the particular regional area of the South China Sea and where do you think that is going to take Japan in its relationship with Vietnam in military issues Thank you, could I just ask you to respond briefly, thank you You're absolutely right the peoples of Japan and Australia are not clamouring to upgrade the relationship in that way this is a view that exists in the defence bureaucracies in each country and I would assume to a certain extent also in the foreign affairs constituencies it's about projecting it's about what is the path that we're on and it isn't a path that says we go this far and no further it's a path that says well logically we're going to have more space collaboration we're going to have military exercises and yes ultimately we're going to be in the field together at some point so the export industry as a component of upgrading the relationship it's a really tangible long term element that would facilitate that trajectory and so it's the policy makers who wanted it not the people what will change it well we might find out if a an ICBM goes over another part of Japan in the near future or even lands somewhere in Japan I think we'll see a change in the statistics that Professor Kubo showed us about how many people are willing to step up and defend Japan I think it will transform the atmosphere and I think Prime Minister Abe to a certain extent is looking at this kind of an opportunity to put it very bluntly he's in a bit of trouble domestically and this is the kind of threat that will galvanise public opinion in the direction that he's hoping it will eventually go in Thank you for your excellent question About submarine, our export ban of the weapons were loosened very recently and my guess is that the government was for us to go very slowly, gradually which is a typical Japanese thinking with concluding the agreement with the UK on selling boots and uniforms then Australian government invited us for a submarine bid which is a real surprise so we probably Japan was not really trained and accustomed to skillful in selling these things but if there's another chance we'll do a better job About the South China Sea, of course for Japan the East China Sea is more serious threat it's given more priority in national security policy but we tend to see the South China program with that in Crimea or in Ukraine in the sense that these are the same cases of unilateral action by force, unilateral attempt to change the status quo so we have a very keen interest in what's happening in the South China Sea but our way to deal with this is not by sending military vessels to that region but mostly by helping Vietnamese or the Filipinos having their own capabilities to defend their own territories and I think Japan is working with Australia on these things to be and there's a proposal even in Japan for Japan to send military vessels to the waters claimed by China in the South China Sea but then the reaction might be very violent from the Chinese side and then we have to be more alert on the East China Sea which might be a burden for the US military too and that's it, understanding that Japan will mostly concentrate on the East China Sea in a narrowly military sense but we help these other countries adjacent to the South China Sea in a very different way. Thank you. Thank you very much to all of the four speakers who have put it in extremely stimulating and very thought provoking set of presentations it's been an excellent session and I appreciate the audience participation as well. Please join me in thanking the four speakers. Thank you.