 Ladies and gentlemen, ladies and gentlemen, welcome to the beautiful Bly Street headquarters of the Lowy Institute. Lovely to see human beings back in the building today. This building stands on the traditional land of the Gadigal people of the Eora Nation, and I'd like to begin by acknowledging the traditional custodians of the land and pay my respects to their elders. We're delighted today to host the launch of Red Zone, an important new book published by Black Ink and written by a long-standing non-resident fellow of the Lowy Institute, Peter Hatcher. In today's Australia, apart from COVID, I would suggest there is no bigger story and no more consequential issue than our relationship with China. And this book is an important contribution to that debate, and I'm pleased that to launch it today, we have with us the 29th Prime Minister of Australia, the Honourable Malcolm Turnbull AC. I have known Malcolm for three decades. I met him when I was a bright-eyed and bushy-tailed young Republican. I established a branch of the Australian Republican Movement at the University of Sydney, and Malcolm invited me to join the National Committee of the Australian Republican Movement. Used to say, Malcolm, that there's never been a more exciting time to be an Australian. Well, in the early 1990s there, it certainly seemed there had never been a more exciting time to be an Australian Republican. Today, we're talking about big issues, sovereignty and independence and Australia's place in the world. This is not about the Republic, but I know Malcolm that both of us look forward to the day when Australia has a head of state who is one of us. Mr Turnbull already had a remarkable career as a barrister and a banker when he entered the parliament in 2004. He went on to serve as the Minister for Environment and the Water and the Minister for Communications, as well as the Opposition Leader before serving as Prime Minister from 2015 to 2018. Mr Turnbull played an important role, a very important role, in Australia's approach to China, so he is the perfect person to launch this book. Malcolm Turnbull, the lectern is yours. Thank you. Welcome. Well, thank you very much. Thank you very much, Michael. It is wonderful to be back at the Lowe and with people in the room that's hope, that stays that way forever. And it's, look, congratulations, Peter. It's great to be here with you and Mindanao, your wife. Congratulations on another great book. I don't have one with me, but, yeah, there it is. Let me hold it up. I'll hold it up. Thank you, Alex. There you go. Red Zone, China's Challenge in Australia's Future. It's a very important book. And it is one that I hope will be widely read. The relationship between Australia and China is of vital importance, obviously. But it is all too often being dumbed down, boiled down, if you like, into headlines, slogans, belligerent rhetoric, mostly coming from the Beijing side, I have to say, but not exclusively. So I'm going to say a little bit about what I think are the big issues and what we can do in the future, and then I hope we will have a discussion. So I will try to be brief, but I warn you, I want to warn you that in an age of fake news and the normalisation of misinformation, the one thing that you can almost genuinely, generally be certain that a politician will mislead you on is when he or she says, I will be brief, but I will do my best. I will do my best to fight fake news on that score. Look, everyone is unhappy with the state of the relationship between Australia and China at the moment. I mean, we are in the freezer. That is a deliberate policy of the Communist Party government in China. That is the term that they routinely use. And they have put Australia in the freezer in order to intimidate Australia and to make Australia more compliant. That's it. That is basically what it is all about. It is they have taken exception to a number of things that we have said or done, in particular, as Peter describes in this book, the decision of my government to introduce foreign influence and foreign interference legislation. At the end of 2017, enacted in 2018, this was seen as being targeted at China. Well, it wasn't targeted exclusively at China, but it was a reaction to extensive Chinese foreign interference and foreign influence operations in Australia, particularly by the United Front work department. Now, there's no bones about that. And as I said in my own book, which I have to say, Peter generously quotes from, and with attribution, I might say, although plagiarism is the sincerest form of flattery, but I can't accuse you of that. You've been thoroughly scholarly in that regard. But for us to be shocked, surprised, horrified by Chinese espionage is pretty naive. As I say in my own book, it's like Captain Renault bursting into Rick's bar in the movie Casablanca and saying, I'm shocked, shocked to find there is gambling going on here. But having said that, we all have to protect our own sovereignty. We have to stand up for our own interests. And anyone who believes that sycophancy or subservience will win you anything other than contempt from the bullies that are demanding it from you is just utterly naive and wrong. You know, we have to always stand up for ourselves. And I have used, I've talked about standing up in speeches about China for well over a decade, well over a decade, probably two decades. And the point that I've always made is that when modern China, by which I mean communist China, was founded in 1949, Mao said on top of Tiananmen, the Chinese people have stood up, right? Well, the Australian people stand up. The Indonesian people stand up. The American people stand up. Every nation is entitled to stand up for its sovereignty. And that is all that we have done. Now, there is a tendency in Australia, I think less than it was a few years ago, but there is a tendency for Australians to blame themselves when they encounter anger from Beijing. And Peter has a very good chapter about anger from Beijing. And he basically describes how the Australian media have just reflexively played into the propaganda objectives of the Chinese Communist Party. Because they've said, when the Australian government says something or does something, they'll say, this will create anger in Beijing. This will cause anger, as though the utterly instrumental and confected reaction from Beijing is something that we should blame ourselves for. I mean, you take, well, the decision about Huawei, for example, is one that I've been criticised for in many places, praised for on others. But that was the most careful, meticulous, technical examination. I mean, we started off looking... I mean, it was an initiative of mine. I mean, as Peter describes in his book, the Australian Signals Directorate were starting to get a bit anxious about the intense technical interest I was taking in the latest developments in wireless technology. But nonetheless, the approach that we started off with, the premise we started off was, is there a way to mitigate the risk? That was, you know, my goal was to be able to have vendors from every country available in 5G here, but subject to being able to protect ourselves. How could we mitigate the risk? And a very careful, lengthy technical examination concluded that we couldn't. So the decision was not a political one. It wasn't anti-China or anti... It wasn't even anti-Wahua. It was simply an assessment of risk and how best to hedge that risk. Now, every country is entitled to do that. And China does that. Every country does that. So that was our objective, protecting our sovereignty, protecting our security and doing so in a measured, careful way, not in a political way. This is not... We have never sought. Australia has never sought to contain China or oppose China in any sort of political way. I mean, that is a theme that you obviously see in the United States, perhaps more so now than 20 years ago, but that's never been part of our thinking. So what has changed? What has changed is that China has become more aggressive, more assertive, whether it is in the South China Sea or whether it is in its industrial espionage operations or whether it is in terms of the so-called Wolf Warrior diplomacy, which is absolutely and utterly counterproductive. I mean, if diplomacy's objective is to win friends and influence people, China's belligerent or aggressive, you know, diplomacy, if that's the right word for it, has only served to undermine trust elsewhere. So let me make another point about this, which is of particular importance in our region. During the Trump years, America became irascible, unpredictable, unreliable, unsettling friend and foe alike. And, you know, there wasn't one alliance that Trump didn't shake the cage of or rattle the foundations of, other than, I suppose, ANZIS, that was the only one. But everything else, NATO, Japan, South Korea and so forth, all of those alliances were threatened. Now, in that context, China had the opportunity to be the anti-Trump, to be predictable, consistent, measured, reasonable, reliable. Instead, they've gone down a line which is essentially Trumpy, you know? All of these, you know, wild allegations and threats and so forth. As Peter describes, there are 11 countries in the world that have been punished with, essentially, with trade measures by China for either saying or doing things, often meeting the Dalai Lama, which have displeased Beijing. And yet, this is the same government that says to us, after this long record of intimidation and bullying, says to us, you should trust us with Huawei that we would never, never inconceivable that we'd think about using that capability in any way to disadvantage you or undermine you or threaten you or coerce you to do our will. Well, the bottom line is, every day this sort of bullying, wolf warrior approach proceeds the case for making the decision we did about Huawei, the case we made for the foreign interference and foreign influence legislation gets stronger. So, the next question, I guess, and I'll just conclude on this point, is what are we gonna do about it? That's the thing that's got everyone scratching their heads. Let me say, I think it is clear we are in the freezer for quite a long time. That's certainly what we should assume. I don't think there is anything Australia unilaterally can or should do to change that. I mean, certainly if we were to comply with the 14 points, the 14 demands that the Chinese Embassy gave a Australian journalist, that, I mean, that's just so ludicrous. It only underlines how disconnected this bullying approach is from the reality of Australian public life and politics. The only thing we can do is stand our ground, continue to stand up for our values and our interests. We should, however, be careful about the language we use and when we use it. You know, gratuitous belligerence is never helpful. And we've got to be careful, I think, always to recognize that there is a height, you've got to be artful and nuanced very often in diplomacy and international relations. So you have to be careful about what you're saying. But that does not mean that every offence that is taken or any of the offence that is taken is justified. Now, just to defend Scott Morrison and Maurice Payne on that score, it is widely said that Morrison and Payne's demand that there should be an independent inquiry into COVID, in the origins of COVID, was misguided or artless or, you know, ill-prepared, whatever. These are literally, these criticisms are footnotes to footnotes. They are not trivial, I mean, that's reasonable, but the real point about that episode was the overreaction from Beijing. I mean, if you think about it, if Morrison and Payne's call for an independent inquiry had been met with either no response, it wouldn't have, it would have sunk without trace. It would not have been reported anywhere, you know, maybe, you know, where it was first added on the Insiders program. If Beijing had said, well, we've noted that request and we certainly expect the World Health Organization to conduct an inquiry and we'll cooperate with it, it would have, you know, maybe got onto page three. What made it a story and an issue was the wild overreaction. And the sanctions, the trade sanctions, which is the best way to describe them, which followed, which of course were building on ones that had previously been imposed, have only served to strengthen resolve in Australia, to make public opinion in Australia more adverse to China than it was before. And of course, because our economy has continued to progress, notwithstanding the pandemic, has only served to remind Australian businesses they shouldn't have all their eggs in the China basket. So at some point, this utterly counterproductive foreign policy is going to have to be addressed. But given the nature of the Chinese government and the authoritarian system on which President Xi presides, that's likely to take a very long time. So our assumption should be to, excuse the cricketing metaphor, we just have to play a straight bat, stay at the wicket, not back down. It's the worst possible thing we can do. Be measured and careful in our language and look forward to a time when rationality or common sense may prevail. There have been episodes like this before. I mean, indeed, those of you that remember the speech I gave at the University of New South Wales in August, not long before I was deposed, was one which was, had no, there was literally nothing about it in substantive terms that was at odds with anything I'd said or done, but it was a very warm speech about Chinese and Australian collaboration and cooperation. And that was part of an easing of the tensions. Now, obviously my role in that came to an end because I was no longer PM. But ultimately, we've got to make sure that we don't do anything gratuitously, that's the key word, to inhibit the opportunities for an elegant dismount or an exit ramp by Beijing. Because they're the ones that have, they've gone out onto the limb of this antagonism further than anyone else. Finally, one point about boundaries of trust. All of us in our relationships trust some people more than others. You know, there are things you would tell your wife or your husband that you wouldn't tell anyone else. There are things you'd tell your wife and your children and your husband that you wouldn't tell anyone else and so forth. We have to recognise that in our relations with China, and I think we just have to be very open and clear-eyed about this, there are some areas where we do not, will not collaborate. There are some areas where they will not allow Chinese-controlled companies to invest. Okay, some areas of technology which we won't want to have in our telecoms network, for example. And every country makes those decisions, as I was saying earlier, every country does. But the range for cooperation, climate change, I know Peter has written about this, the opportunity for cooperation in climate change and, you know, whether it's pumped hydro or solar or wind or whatever, those are massive opportunities there as there are in many others. So that the area, the scale of the opportunities for continued cooperation and engagement vastly exceeds the areas where we would put a boundary of trust and say, no, we'll just deal with the people we are closer to. So I think in that sense, perhaps the best thing we should all be doing here, whether we can influence the point of view in Beijing as another, is to focus on the positive, the glass half full, rather than the, you know, frankly, much less than the glass, half of the glass that is empty. So thank you very much, and Peter, congratulations on your book. It's an outstanding contribution. Now, Peter, right. Thank you. Thank you, sir. Thanks. Thank you. Terrific. Thank you very much, Malcolm, and we're pleased to have a relation of trust with you. So thank you for launching Peter's book. We'll hear more from Mr Turnbull in a minute, but first of all, let me just invite Peter Hatcher to respond. Peter is the political and international editor of the Sydney Morning Herald and the Age. He's had a very distinguished career as a foreign correspondent, a political reporter, a columnist, and the author of many well-reviewed books. The media has changed a lot since Peter first joined the Institute as a non-resident fellow, but the importance of Peter's columns hasn't changed. They still drop with an almighty clang and thud. There is a lot of chatter and background noise in the current media environment, but a Hatcher column can still penetrate it, and of course, that applies even more so for a Hatcher book. So, Peter, let me call on you to make a few remarks, and then I'll get Alex Oliver up to chair a discussion. Peter. Thank you. Thanks for that very flattering introduction, Michael. I'd prefer that my columns hit with a thud than a clang. I'd rather be a thudder than a clanger, but we all have the occasional professional clangers. Thank you, everybody, for coming, Malcolm. And thank you so much for launching the book with that generous endorsement. I think publishing companies first wish is that a book launch creates news. I think, Malcolm, you might have created news the moment you said I'm going to defend Scott Morrison, full of surprises. Your point, Malcolm, about the Beijing's instrumental use of confected anger or what the cyanologist Jeremy Barmay describes as performative anger is, of course, a very good one and absolutely correct. I do discuss that in the book, but I also do a mea culpa because at some points I was responsible for falling unwittingly into the same trap and describing, I was embarrassed to discover, in a column of mine and a headline reflecting in a column about how China will be angry or something to that effect. So I fell into the trap, too. It's a very easy one to fall into. The realm of ideology, ideas, propaganda, and language is what Xi Jinping calls the primary battleground, the primary battlefield. That's his word, battlefield, not mine. And so if that's where our great rival perceives the basic battleground, we have to be aware of that and treat it pretty seriously as well. I want to pay tribute. You might expect this from me, but I want to pay tribute to the brilliance of Xi Jinping, the dictator of modern China. The brilliance, I think there's no other word for it of his strategy to take territories in the South China Sea that were claimed by his neighbors, to take those territories in the face of a ruling against him from the International Court in the Hague, to take them decisively, to build military bases on them, and to do it without firing a shot was nothing short of brilliant. And they are today heavily armed and equipped Chinese military garrisons, military bases, in the South China Sea. Barack Obama's then Asia Policy Advisor, Danny Russell, told me after the fact he said, the only way we could have stopped Xi Jinping from doing that would have been military intervention. And of course, because what Beijing was using primarily or initially were fishing boats, it would have looked like the US using its navy against civilians, which would have been a shocking act and a propaganda victory for China. So it was absolutely brilliant. And the key point of the brilliance is this. The vanguard of that strategy was an apparent civilian economic activity. It was fishing. First went the fishing boats. Some of them were real fishing boats. Some of them were Chinese militia, pretending to be fishermen. They were followed by state fisheries administration boats. They were followed by coast guard boats. And finally, the Chinese navy, each in an increasing intensity of intimidatory power. So the economic activity at the forefront, the fishing, was the Trojan horse for the assertion of coercive state power that came behind. When Mahatma Gandhi launched his campaign or was going to launch his campaign to get the British Empire out of India, he said this, the British did not take India. We gave it to them. By which he meant that the first wave of the British takeover of what became its colony of India came in the form of traders and investors. It wasn't the British army. The traders and investors in the form of the East India Company. Again, it was the economic activity, legitimate civilian-based economic activity was the forerunner of coercive state power to follow. Countries don't generally expect that a trader and investor, apparently in the private sector, represents ultimately the assertion of another country's power and coercive power over you. It was Sun Tzu, of course, who said to win without fighting is the ultimate strategy. Australia was equally gulled into accepting the Trojan horse of Chinese commercial activity, thinking it was no more than that. But of course, we've discovered, to our surprise, shock and cost, that it was actually the forerunner of coercive state power. Malcolm Turnbull, as Prime Minister and the government you led, should get the credit for being the first Australian government to recognise that, to stand up, to defend Australia's sovereignty, and the Huawei decision was that decision. What appeared to be a commercial actor simply investing in Australian infrastructure was in fact a Trojan horse for the assertion of Chinese state power to potentially switch off Australia's central nervous system, which we're going to be relying on for at least a generation. If you doubt the primary priority that Beijing puts on investment and commercial activity as its essential mascot forerunner of its imperial outreach, then all you have to do is look at that list of 14 demands. Malcolm mentioned the list of demands that the Chinese Embassy presented to an Australian journalist with the view of getting it published last year. What's the number one demand on the list of Chinese... Chinese government's 14 demands against Australia? Number one is that Australia accept China's foreign investment, not try to ban or limit Chinese foreign investment into Australia. That's number one. It's about the investment. Number two is that Australia revoked the Huawei ban that Malcolm's government put in place. So it's all about the use of investment and economic activity as the primary mover, the friendly forerunner of coercive state power. Australia's finally woken up. The Economist magazine a couple of weeks ago described Australia as unlucky, playing on the lucky country label that Australia's lived with since 1964. The Economist magazine said Australia was unlucky because it was subject to heavy trade sanctions from Beijing. And, well, we are subject to heavy trade sanctions from Beijing, but I wouldn't suggest that we're unlucky at all. I would suggest that luck is still with us. First, we woke up. Some countries have not, and some countries have been subdued before they woke up. Second, Australia was very fortunate that it has and had a principled opposition so that when the Turnbull government made its proposals on legislation against foreign interference and espionage, Labor supported those bills wholeheartedly. When the Turnbull government banned Huawei, Labor supported that. On every substantive decision that the coalition government has made to defend Australia's interest, Labor has been strongly principled and stood with it in defence of the national interest. And I'd point out that Penny Wong, when she conducted the Canberra launch of my book a couple of weeks ago, she launched a stinging attack on the Morrison government's rhetoric on China, but she did not attack any of its substantive policy decisions. Labor remains supportive and committed in the national interest. Australia is also lucky because we have some very high-priced rocks that the Chinese government, the Chinese steel industry, is very happy to buy from us at outrageously high prices of $230 a tonne and more. That's not going to last. It's a temporary way that Australia can overcome the effects of the trade sanctions that China is imposing at the same time. But it means that at the macro level, the Australian economy is feeling no pain from the Chinese trade sanctions. Some of the individual companies and industries, it's a different story, but at the macro level, Australia is essentially having a pain-free experience at the hands of China's sanctions. Two more reasons we're lucky. We're lucky we got Biden as president and not Trump. Biden is taking a much more unified position with US allies than Trump was capable of. And finally, we're lucky because China's overreach and aggression has alerted the whole world to its true character and its intent. From here on, Australia is going to have difficulty doing what it needs to do because for a democracy, to do the things that Australia's going to have to do now for a long time are inherently difficult. We're going to have to be sober, vigilant and competent. And democratic systems aren't given really to those priorities. We're going to have to be prepared to do it for a long time because, to quote Xi Jinping, Xi Jinping talking to his own party has said that the, to consolidate the victory of socialism with Chinese characteristics, which is his catchphrase, will take quote dozens of generations, dozens of generations, not talking about years, talking about dozens, we are talking about centuries. So we're going to have to be steadfast and focused in a way that in Australia's experience we've never had to, never had to be. We're going to have to be sober on protecting one of our core interests here, which is the Chinese Australian community. There are 1.3 million Chinese Australians. They're a key asset in our country, a key part of our community. And they are also the first target of the Chinese Communist Party's United Front work department, as it tries to turn them against the Australian national interest in favour of Beijing's. That community not only needs protection, it also needs our full embrace and warmth into the Australian community and the Australian family for however long this takes. And we're going to have to be sober so that we don't get carried away and some nut jobs turn up politically and start in trying to engage racism as a political tool. We're going to have to remain really sober and make sure that we do not allow that to overtake any of our reactions or any of our politics. We're going to have to be vigilant and competent as well. We're going to have to protect our democracy and it's only when our democracy has been properly, and Michael's giving me a time signal here so I'm going to wrap up, don't worry. It's only when we've properly defended our democratic institutions that we'll be able then to confidently go forward and engage with China once we have protected our democratic institutions with some no-regrets moves. For example, we need a federal ICAC. We need federal political donations laws reformed. We need all new MPs and senators to be subject to a security check which high-level public servants have to get and there's no reason politicians shouldn't. And Michael, I'm going to test your patience just for another one minute because I'm going to finish by reading to you some of my few sentences from the acknowledgements that I've written in the book. Speaking and writing honestly about the China of Xi Jinping is not risk-free. I want to thank each member of my family for their support and fortitude in this cause. My greatest debt in all my work is to my chief collaborator, my secret weapon, my wife, Mindana. And I also want to thank... There are some members of the working news media here today. I don't count myself as working media. But I want to pay tribute to the frontline news reporters in Australia's media and worldwide who do the daily work of informing all of us about the realities of our nation and our world. Without their work, our freedoms will inevitably be drowned by deceit, ignorance and public relations. The journalists and writers who bear the greatest risks are the ones closest to Xi Jinping's grasp. China is the world's worst jailer of journalists according to the Committee to Protect Journalists 2020 report. At the time of writing, and today still, two Australian writers are in detention in China's system of political justice. The blogger Yang Hengjun was detained in 2019 and broadcaster Cheng Lei in 2020. I acknowledge their suffering, a reminder of George Orwell's insight in a time of deceit telling the truth is a revolutionary act. Thank you. Thank you, Peter. Very nicely put. And I'm glad you took the extra minute, in particular, to thank Mindana, because all the authors in the room know how much of a burden one's partner takes on, and this is an achievement for both of you. So congratulations. The only reason I wanted to keep moving was that I know the audience always loves the Q&A. We have an opportunity now, so I might ask Mr Turnbull and Peter Harcher and Alex to join me on stage. Malcolm, why don't you sit in the middle? Alex will be here, and Peter on the other end. Let me just introduce briefly Alex Oliver. Alex is one of my longstanding colleagues, a highly respected researcher on issues of diplomacy and public opinion. As research director, she coordinates all of our research output, and she's a great colleague and friend of mine. So Alex Oliver, over to you. Thank you, Michael. And thank you, Peter, for giving this opportunity to talk about the most important relationship of a generation, I think, and thank you, Malcolm, for joining us. I'm going to ask the first question, if you don't mind, before I hand it over to you, the audience, because I'm intrigued when I read the book and I've read most of it in the three days since I've received my very precious copy. In the introduction, Peter, you talk about elite capture, and you say that Australia has become drunk on the Egyptian blue lotus. It's a new flower, I don't know anything about, from the Odysseus legend. And yet you say that Australia has done nothing to change its posture, which closely resembles a cow-tow and it remains willfully ignorant. And that surprised me, because much of the debate in the past few years, and particularly since the foreign influence and interference legislation, which Mr Turnbull's government pushed through now three, four years ago, nearly, has been about, you know, Australia might have been stupefied by imbibing this lotus, but that it's gone from there to being the head of the pack, the canary in the coal mine, the tip of the spear, you know, the various metaphors that you use. So what were you referring to when you talked about that Australia remaining in a cow-towel? Is that directed at corporate Australia? Who are you directing that comment to? Partly, yes. It is. Should I take 30 seconds to explain the lotus reference? Sure. So in the legend, Odysseus, after the Trojan Wars, on his way home, his ships get blown onto the land of the lotus eaters, and he sends a party ashore to look for water and food, and they don't come back. And days go by, and they still don't come back. So eventually, Odysseus follows his men, finds them in a stupa, very happily addicted to the lotus flower, and he has to drag them away from the addictive power of the lotus to remind them of who they are, what their mission is, and to get them back on the boat. And they cry and weep. They don't want to be dragged away from their sweet addiction, and he has to lash them to the benches on his boat to prevent them from trying to escape back into the land of the lotus eaters, and then they go on their way. Of course, after the lotus eaters, their next encounter is the Cyclops, but that's a different story. So yes, Australian politicians, again, credit to Malcolm and leaders before Malcolm, knew some of the threats and some of the actions that were going on in the Australian system, some of them, many of them, not obvious to the naked eye, and yet tolerated them. There was, in fact, Peter Dutton set himself in an interview for the book, where he said, as the minister, in charge of both ASIO and Australian Federal Police, he said those two agencies were taking, quote, a passive, unquote, position on Chinese interference and espionage in Australia until he replaced the heads of those two agencies and gave them a new tasking, a new briefing. So there you have the minister responsible for the agency saying they had been passive, but it was the reason that the Australian government, opposition, and society at large was passive was because of the money. There was such a huge economic benefit to Australia. So yes, you're absolutely right, Alex. Since then, you know, first the Turnbull government, but followed up by the Morrison government, has acted to defend Australia's interests, even where that was to bring down sanctions on Australia in response. Public opinion, I mean, China's apologists in Australia, one by one have fallen silent. The people who, especially the big prominent voices that were most likely and most frequently defending the Chinese government interests in Australia, and it's no secret to anybody that Paul Keating was foremost among them, Bob Carr was probably second, have fallen silent in their justifications. So a lot has changed, but Alex, yes, I was thinking about the industries that even though some of them have now learned a painful lesson about trade diversification, privately many of many business executives and managers still say the moment we get a chance we'll be back into China, having learned not very much. Can I just add something to that? Please. I don't think Peter Dutton's characterization of the heads of ASIO and the AFP, which was obviously Duncan Lewis and Andrew Colvin, I don't think that's fair. Particularly, I mean, it's obviously very much, espionage is very much, ASIO's, you know, Bailey work, particularly, but Lewis was actually very forward, you know, he was never alarmist, but he certainly was very upfront and I think appropriately aware of the espionage and foreign influence operations and alerted us to quite a bit of it. So I just, you know, I think, I just, I don't agree with that. To be honest, they only came into home affairs after home affairs were set up. So I, you know, I'm in a much better position to speak about both those agencies on that issue, frankly, than Peter was. I just wanted to, I wanted to defend those to very imminent Australian public servants. We'll have to let you take that up with Peter. Sure. The National Security Establishment is certainly alert to the issues now. I'm going to throw it open to the floor. We've got many people I know who want to ask questions. So when the microphone comes to you, please identify yourself, but of course we know many of you and please keep your comment to a question so we can get through as many as we can in 15 minutes. Paul, Kelly. My question is to Malcolm and I'm happy if Peter wants to make a contribution to it. So there are two questions, Malcolm. The first is when your government was taking these path-breaking decisions about China, the foreign interference laws, and then the Huawei decision, to what extent did you anticipate the reaction from China? So looking back, would you say that you expected retaliation of this extent or are you surprised at the extent of retaliation that Australia received from China? So that's the first question. The second question is, given that we anticipate that this is going to be a long drawn-out process with China, is it correct to say that the Australian public and the Australian business community has got to accept that there will be a greater price to pay for Australians, that there will be a greater degree of punishment imposed on this country as a result of these tensions and as a result of China's actions? And if that's the case, should the Australian government be better preparing the Australian public for that situation? Well, the first question was, was I surprised by the reaction? I was surprised by the ferocity of the reaction to the foreign interference and foreign influence legislation. I mean, it was so over the top, even to the point of accusing me of being a racist. Mind you, there were some people in the Labor Party who echoed that, Christina Keneally at the time, during the Benelong Baye election. I mean, this was a very fraught time because you had the Dastyari scandal, you had the Benelong Baye election, you know, big Australian Chinese community in that electorate and you had that legislation. So there, as is often the case in politics, a lot of things happening at the same time which tend to defeat on each other. But the, you know, as I said at the time and as I said to Xi Jinping directly, the proposition that anyone who's grandchild and or at least two of them call him year year being anti-Chinese or racist is just ludicrous, utterly ludicrous. And I think that was an example of the sort of, I don't think anyone in Australia thinks I'm a racist, right? You know, that's, I mean, I've been ridiculed for promoting multiculturalism and sometimes for overdoing it or criticised for that. But it was literally as though they decided, you know, they threw everything, the kitchen sink, and then, you know, dug up some of the plumbing below the floor to throw at us. It was just, it was bonkers, I thought, way over the top. So yes, I was surprised by that. Do I think trade is going to be more, yeah, it is. Paul, I think we've got to recognise we're in this for the long haul. But, you know, ultimately, ultimately I think a degree of modus vivendi will settle down because, you know, at the end of the day, I mean, Chinese steel mills are paying more for metallurgical coal now as a result of the ban on Australian metallurgical coal than they otherwise would be. They're not going to be happy about that for too long. There, and, you know, there's very good quality Australian produce, wine, beef, you know, in particular, that they're not getting, which they like. So, you know, it's, it, and has it resulted in Australia being more compliant? No, quite the contrary, you know, it's gone the other way. So, you know, this is the, the fundamental point is, this pressure play to make Australia more compliant has failed. It has been counterproductive. Now, the question is, when will that, that reality be matched by a change in strategy? That's the question we don't have an answer to. Everyone seems to assume, not for a long time. Just remember this, you know, and I just use this as a counterpoint. One of the most counterproductive long-standing foreign policies in the world, I would think, is the American embargo on Cuba. The only, you know, which of course was maintained for entirely domestic political purposes in the United States, as everyone understands, because of the Cuban expatriate population, but has enabled, essentially enabled, that communist regime to stay in power for all that time. So, you know, it's, countries big, great powers in particular are perfectly capable of having self-defeating counterproductive foreign policies for a long time. But, you know, at the end of the day, there are things that they buy from Australia, particularly I know, that they can't buy anywhere else, at least for the time being. Have we got, while you're thinking about the next question, I'm going to ask one of my own. The question which flows from that one of Paul's is that, you know, if you were in government now, Mr Turnbull, is there anything that you would do differently from the way this government is managing China policy to Paul's question about getting the public and business to accept that there will be high prices to pay? Is the price that we're paying now too high? Is it something we could have done differently? Well, I mean, look, the price, truthfully, there are the impact on those sectors that have been subject to the sanctions, to feel if that's the generic term, has been real. But it's not one that, you know, that Australian business is adaptive, you know? The barley producers have sold their barleys everywhere else. Have you noticed that Australian beef is cheaper at the butcher shop lately? Emergency? No. So, you know, the beef producers will, you know, people will adapt. I think it is going to remind all of us not to put all our eggs in one basket, which, you know, everyone says, you know, everyone's grandmother told them to do that and we generally forget it, but it's very wise. So I think overly concentrating on the Chinese market has been a mistake. It's a point I make in my book, you know, that we got, and one of the reasons I had such a focus on India and ASEAN is that we became mesmerised by China to the exclusion of the rest of the region. You know, and that was part of the theme of the Shangri-La speech I gave, you know, some time ago, which was, you know, apparently well-reviewed at the time or thought of as being an important speech, but that was really the message that we've got to... We cannot afford to look at the world as just one of hub and spokes. We've got to look at it as more of a mesh and look at our region and make sure that we are closely engaged with all of the countries in our region and not just focus on, you know, Beijing there and Washington there. But, yeah, I mean, it's... Look, you know, there isn't much alternative. We do not want to be, to China, what Finland was to the Soviet Union. So, you know, that's the bottom line. So we are an independent sovereign nation, not yet a republic, but in other words... In every other respect, utterly sovereign and entitled to... I mean, we don't go around demanding respect, you know, but we do... We are entitled to say to other countries, you should respect our sovereignty as much as you want us to respect yours. And that's it. So there's not much to ask, honestly. And the alternative is, again, Peter's become a complete Hellenophile, but the alternative is that you end up jumping from Homer to Thucydides, you know, in that famous million dialogue that I know I've talked about here many times before, you know, with the great punchline, you know, 2,500 years ago or thereabouts, you know, the strong do as they will, but the weak suffer as they must. Well, that's, you know, as a middle power, we're not in favour of that. We've got to maintain the rule of law and we've got to make sure that we aren't bossed around by anybody. The evidence, we're not suffering too badly. Well, no. No, I think that's... I think that's... I think that's right. I think the... Yeah, look, I... I mean, who am I to give Xi Jinping foreign policy advice? Well, I have offered some over the years, but they had no influence at all. But... But the... But he... But really, they've overplayed their hand, I think. So... Now, I've got one, two, three questions here. I might start with you, gentlemen, here on the end. My name's Dean Palme from the Good Food Institute. So, Peter, you talked about the importance of the rhetorical, intellectual battlefield to the CCP. And it seems like one area that Australia is kind of losing that due to our own focus is on climate change. And just to focus that to one area, looking at the Pacific and from a defense perspective, we're really worried about Chinese interests in bases, fishing operations in the Pacific. And our domestic policy on climate change is really causing us damage there and our ability to influence those governments. So I was wondering how important you think that is more generally, because that influences economics as well. And what we need to do in that space in the near future. Well, I'm happy to have a word, but I think the real expert on that is sitting next to me. But broadly, you know, in a relationship that is now where all the focus is on our differences between Canberra and Beijing, we have to get to a point where we can also talk about areas of cooperation. Climate change is the primary one and the most obvious one. But there are others, and transnational crime is another example. We have to be able to find areas of cooperation with Beijing, not only in the interest of those issues themselves, but also to re-establish a dialogue and a modus vivendi with a country which is going to be in our region forever, as we are. We have to figure out a way to have a cooperative relationship as well as being able to stand our ground on red line issues. So climate change, Australia's policy has to be more active, of course, and not only in the Beijing account, but also, as you say, we've got to be able to keep our interests and engagement and friendship in the South Pacific, where the Chinese Communist Party is and will be making inroads, and we have to be particularly vigilant there. But the expert on the subject is Malcolm Turnbull. Well, thank you. Well, that's very kind. That's very flattering. These are honeyed words. But, so you've used all of them up for a long time. For the month, I think. Look. Well, that's because you're a former Prime Minister. You're a former Prime Minister, that's right. Look, yeah, there's a lot of potential for further collaboration between Australia and China on climate. You know, one of the great partnerships, really, one of the greatest transnational, international partnerships on climate, of course, is between the technology developed by Martin Green and his team at the University of New South Wales, photovoltaic cells, the technology, the PERC technology, more particularly, which was industrialized by his students, principally or initially, Sherjong Ren, in China. And, of course, that's why we have solar panels that are A, so as efficient as they are, and B, as cheap as they are, because of the massive economies of scale. So that's a great, that's a great China-Australia story. If you want to talk about a China-Australia partnership that has literally changed the world and may well save the world, it's that story of solar energy, solar power. So, that's one thing. In the Pacific, look, our position on climate is a big negative in the Pacific. I mean, I've been, obviously, I've been to Pacific Island forums. I've, you know, used to know most of the leaders in the Pacific, it's a bad look. I mean, we are more out of step on climate with the rest of the world, and in particular, our closest friends and allies, than we've ever been on any big international issue. You know, it's embarrassing. And, you know, you all know the political background of this and the lunacy that we have to, you know, we've endured from, you know, right-wing media, right-wing politics, you know, coal sector, et cetera. But, that is a big negative in the Pacific. Having said that, you can be creative. So, at one point, there was, Huawei was a bit of a history to this, but Huawei were going to build a fiber-optic cable to link the Solomons, you know, to the internet. And we, you know, I pre-empted that, basically with the coral cable, which some of you be familiar with, which we've paid for with aid money, which is perfectly legitimate. And we built a, you know, fiber-optic cable that runs from Australia to the Solomons and PNG, and, you know, we're doing other things supportive of that and the Solomons. I mean, so, the reality is, we've just got to get in, and where we see developments that are not that we think could be adverse to our interests or adverse to maintaining the sovereignty of the South Pacific, then we should be prepared to step up and that will involve writing a check. I'm afraid I'm going to have to leave it there because we've run out of time. We'd like to finish on time. Sorry for those of you who wanted to ask questions. But you could just do a couple more. It's only quarter to two. Any other information from the boss here? Yeah. Okay, I'll take one from Hamish then. You've written and spoken a fair bit about the role of Maurice Payne... Sorry. You've written and spoken a fair bit about the role of Maurice Payne and maybe you'll address this in the book. I haven't got a copy of it yet. I'm interested to know from both of you who, and this might be multiple people, who is driving Australia's policy towards China currently? Prime Minister, is it bureaucrats? Could you offer a perspective on this? Well, I'd defer to Malcolm on it, except to make the prefatory comment that Australia has no China strategy. Australia has no China plan. The federal government has driven, you know, in a reactive, reflexive sort of mode where it takes ad hoc actions as the agenda and the urgency of the day seems to suggest. It's given the scale of the problem and the interest at stake, it's pretty poor. I think it's a pretty poor effort and it should be a priority. But exactly who and how that sort of ad hoc dog's breakfast of a policy approach is created, that I give you, Malcolm Turner? Yeah, that's not true. Certainly my government had a very considered China strategy. It was, you know, the subject of discussion, not at every NSC meeting, but probably every other NSC meeting at least. And it basically is one of seeking to constructively engage, to, you know, defend our national interests and our values, defend the maintenance of the rule of law in the region. And yeah, I mean, it's like it's an effort to navigate, you know, to pursue our agenda, recognising that we are dealing with a counterparty that is often, you know, pretty aggressive, you know, difficult, belligerent, what have you to pick your adjective to deal with. And the policy has absolutely been to try to turn down the volume where we can and not get into a shouting match. Now, there's a very good example, if I may say so, and Peter acknowledges this in the book. The decision about Huawei was taken, was actually formally taken, some weeks before it was announced. And we planned a very, very careful announcement strategy. Now, as it happened, the announcement ended up being in the week I was, you know, overthrown as Prime Minister, so that was entirely a coincidence. And, you know, we gave the Americans a heads up. We gave the Chinese and Beijing a head up. We gave Huawei a heads up. ZTE a heads up. We gave everyone that had an interest, a heads up, well in advance, so there were no, you know, because surprises are the things that cause people to react unpredictably sometimes. So it was absolutely no surprises. It was agreed that the Prime Minister and the Foreign Minister would not say anything about it at the time of the announcement. Obviously, we knew we'd be called upon to say something in the future, but the announcement was literally to be a press release from the Home Affairs Minister and the Communications Minister. Now, because Dutton had resigned, that turned out, the Home Affairs Minister turned out to be SCOMO in an acting capacity. But all the press releases, all of it was written, you know, ten days before. So it was all carefully orchestrated. And what was the reason for that? It was the reason because we wanted to make the right substantive decision. We obviously had to communicate it, but we didn't want to raise any hackles, angst, whatever. We wanted to give Beijing the opportunity to use another cricketing metaphor to let that ball, you know, go through to the keeper. You know, we wanted to give them the opportunity to not overreact. And so that's the... I mean, I don't go through... I don't, you know, publish my discussions with the Prime Minister but my esteemed successor, but I can assure you that the government's position, at least officially, is the same approach. Now, there have been some outbreaks of colourful rhetoric from some individuals in the government. They are not helpful, right? So ask yourself, who is this benefit? And if you start talking in a belligerent way about foreign policy, particularly with China, in order to gratify elements of the media or your political constituency here, then you may well be falling into the same mistake that the Global Times, no doubt, falls into in China, where some of its colourful rhetoric, which clearly is counterproductive from a policy point of view, is designed to gratify public opinion back in China. So, you know, we have to be really smart about it and we have to recognise that, you know, China will seek to bully us and pressure us in a way that it wouldn't the United States. I mean, you think about it. There's a complete freeze on ministerial contacts, right? We've been in the freezer for, I don't know, maybe over a year now. The Americans, both Trump and Biden, have said the most hair-raising things about China. Do you reckon any American secretary of state, any American official that wants to pick up the phone and talk to his or her counterpart in Beijing won't have someone at the other end of the line? Of course. It's totally different. It gets back to that point about the million dialogue. That's the problem. Strong doers, they will, and the weak suffer as they must. It's like I remember one representative of a great power saying to a New Zealand representative, New Zealand minister many years ago at a conference, he said, he said, you are just a little country. We don't care what you think. Now, I won't say who those people were. You see, I'm uncharacteristically discreet today, but that's the thing. That's the thing that we've got to fight again. So, we've got to be smart and, you know, so that stand our ground, advance our interests, seek to engage wherever we can and avoid, you know, gratuitous, colourful, you know, comments that may play well in the Daily Telegraph or on, you know, 2GB or something, but are not going to advance our cause, you know, internationally. Alex may make a very brief point in my own defence. I think, Malcolm, what you've described as a set of principles and an anecdote rather than a strategy, I'm yet to see any evidence from this government of a cogent China strategy, and the principles that you've outlaid, I'm sure this government is still standing by, but the fact that you were able to point to the careful announcement of the Huawei ban in stark contrast, for example, to the way that Morrison and Payne blurted out their request for an inquiry into COVID indicates an inconsistency behind which lies, therefore, no strategy. Well, I think you could say there is a strategy, but its execution is imperfect from time to time. Execution, not strategy, exactly. Well, you have been the master of discretion, Mr Turnbull, today. I'm normally the sole of indiscretion. You're more fun when you like it. We've given an absolute treat, so thank you to the Prime Minister who got us off the lotus habit, and to Peter Hart, who warns us that relapse isn't an option. You've given us some real gems. China and Australia are saving the world together. We saw the PV, I like that one. That's true. And Beijing being Trumpy, there's plenty of good expressions and words through there. Thank you very much to both of you. Congratulations, Peter, on an excellent book. Congratulations.