This 'little nation' packs a mighty wallop on the world stage

Australia’s practical, outcomes-oriented approach has achieved great things for our foreign policy in what has been a challenging and successful year. But the Government's approach is not mere pragmatism. Rather, it is fundamentally underpinned by our attributes and values as a nation.

It is a demonstration of our willingness to meet our global responsibilities to promote security and prosperity. We are a steadfast ally, a friend to freedom, and we honour the diversity and breadth of our international relationships. Australia is not just a "middle power", as my predecessor Gareth Evans was wont to say. We are a strong commonwealth with about the 12th largest economy in the world. We are one of the most successful, peaceful and well-governed democracies in history. Rather than a middling nation, we are a considerable power, the sixth largest in total land mass.

That notion of a "little Australia" had been the prevailing paradigm throughout the previous government and remains strong among its remnants. Kim Beazley articulated Labor's position as its federal leader in 1998. He told the national Chamber of Commerce and Industry of the need for innovation "to compensate for what we lack in competitive clout by being a small nation". A "small nation".

Where does Simon Crean stand on this fundamental question? Certainly his foreign affairs spokesman Kevin Rudd says Australia is "a small nation". Yet even on our weakest measure, population, our 20 million ranks us at about the top 25 per cent of the world's nations. And social cohesiveness, strong institutions, and confidence in what we stand for as a nation count for much more.

The tendency to regard Australia as a second-class state infects baby boomer members of the commentariat, although thankfully most Australians, especially the young, remain uninfected.

At its most extreme, the "little Australia" phenomenon leads to weird kinds of self-disgust. But Australia's foreign and trade policy is more surely based on a grasp of our traditional roots in Western civilisation, our distinctiveness as a people and considerations of the interplay of national interests and our global responsibilities.

National identity develops organically. It should always inform foreign policy and not, as some of our critics assume, be informed by it. Our sense of shared identity should derive from justified pride and confidence about our achievements as a nation and a people, and a ramified understanding of a complex past.

We can take pride in our achievements in grasping the economic opportunities of globalisation by being open, innovative and competitive. We are proud of the valiant, highly professional contributions that our soldiers, sailors, airmen and women have made to the war against terror and the war in Iraq. We are proud of the role that the military, police, aid workers and diplomats have played in restoring normalcy and security to Solomon Islands in three short months.

Tolerance and perseverance are fundamental to our spirit. And we are a stable, liberal democracy, with sound national institutions and an indefatigable commitment to the political and economic freedom that underpins that society.

Not only do we refuse to apologise for our values and beliefs, we will help those in our region and beyond who aspire to the freedoms we enjoy. This has occurred, for example, through our continuing nation-building efforts in East Timor, our work to help Iraqis rebuild their country, free of tyranny and oppression, and through our engagement in dialogue on, and advocacy of, human rights.

In Iraq, together with our coalition partners, we have removed a regime that represented a threat to international non-proliferation norms, to the security of its neighbours and to the lives of its people.

We didn't do it because we thought what followed the regime's downfall might be easy. Nation-building rarely is. But who among us would be prepared to proclaim that they wish the removal of Saddam Hussein's regime had not occurred?

Australia remains an outward-looking country, conscious of the responsibilities that go with our role in the international community, to contribute to global security, prosperity and development. In a time of uncertainty, that commitment will continue through our efforts to build effective co-operation with our neighbours to counter terrorism.

We will continue our work to prevent the proliferation of weapons of mass destruction. We remain committed to helping neighbouring countries strengthen their governance and enhance their institutions.

Australia has a well-deserved reputation for being a steadfast friend to many - both nations and oppressed minorities - particularly in uncertain and dangerous times. It's an extension of our distinctive understanding of what mateship can mean.

And we certainly do not allow terrorists and extremists to dictate who our friends and allies should be. We also recognise that, like friendship itself, our relationships across the globe are not mutually exclusive. Ultimately it is not those people who profess to be ashamed of their country to whom we answer in the conduct of our foreign policy. It is the Australian people. We understand that very well, and it is what drives us to deliver substantial foreign policy outcomes.