East Timor and the Defence Budget Issue

It is depressing to see the way the East Timor issue is being exploited to justify increased Australian defence expenditure. Twenty years ago, our leading strategic analysts used to bark about the Soviet naval base in Cam Ranh Bay. At least the Soviet Pacific Fleet had warships, missiles and submarines. But East Timor's militias??

East Timor is a humanitarian crisis. It is a peacekeeping operation that might turn into a peacemaking one against a dangerous but ragtag militia equipped with small arms and home made shotguns. There is no threat to the security of Australia or its territory. There is no hostile army poised to invade Australian territory, not even Christmas Island. The Indonesian government and people are understandably angry with Australia. But the Indonesian armed forces are not at war with Australia and they do not have anywhere near the capability to seriously challenge Australia's navy and airforce. Indonesia's financial problems have resulted in a thirty percent cut in the defence budget. That means Indonesia has been unable to proceed with the purchase of new fighter aircraft and the modernization of it ramshackle navy.

Besides, the Indonesian armed forces are preoccupied with internal law and order issues, not Australia.

To use Indonesia and East Timor as the raison d'etre for upping our defence budget to make Australia into some sort of superpotent military power does not make a lot of sense. We are already way ahead of Indonesia in military technology and, meanwhile all the other ASEAN states have rushed to share Australia's burden in East Timor.

The region is not brimming with danger and uncertainty as some government advisers would have us believe. Apart from East Timor, the strategic outlook for the region is not at all unfavourable. The response to East Timor indeed shows a willingness by Australia's neighbours to give substance to the rhetoric of regional security co-operation. If Australia had to sort out East Timor on its own we would be in trouble. But nearly every country in the Asia-Pacific region, including the ASEAN four and the US, has contributed tangible support for Australia's efforts in East Timor. This should be reassuring, yet strangely, we are being told our northern approaches are suddenly more vulnerable and that we need to spend more on potent new weapons systems and populate our empty north.

The hypothesis that that there is a dangerous arc of instability in a region that once shielded Australia from predatory states further north does not hold water. It is designed to stampede Australia into a sense of insecurity.

The region is on the way back from its recent economic troubles. There is unprecedented support for democratic values, the rule of law and the principle that human rights transcend national boundaries.

China has become a good friend for Australia. Indeed, in Asian terms, Australia and China are on the threshold of a strategic partnership.

The so-called flashpoints in the region have stopped flashing. In the South China Sea, China and the Philippines are considering joint naval patrols.

Across the Taiwan Straits, China is helping Taiwan with earthquake relief. The mainland is still Taiwan's most important destination for foreign investment and one of its most important trading partners. Next month, Chinese officials will visit Taipei to discuss the way ahead.

In the Korean peninsula, a more nuanced US diplomatic effort has reassured Pyongyang on the benefits of freezing its ballistic missile tests.

In North East Asia, the suggestion of an intensely competitive great power game between China, Japan and the US is exaggerated. More work has to be done on the TMD issue and there will always be ups and downs in the Sino-US and Sino-Japanese relationships. But China and the US continue to co-operate in stabilizing the Korean peninsula and easing tension and misunderstanding in the Taiwan Straits. The Japanese defence budget remains at one per cent of GDP, the same level it was twenty years ago, and, in the meantime, Japan has set East Asia as its priority area - not for an arms build-up - but for official development aid.

Relations between India and Pakistan are tense, as usual, but conflict in Kashmir is hardly likely to threaten Australian territory.

Furthermore, the Australian Defence Department's figures for regional defence expenditure trends do not support the argument that Australian defence expenditure is at dangerously low levels. According to the Defence Intelligence Organisation's authoritative publication Defence Economic Trends in the Asia-Pacific Region 1999, Australia's per capita defence expenditure is higher than that for Canada, South Korea, New Zealand, Thailand, Indonesia, Malaysia and the Philippines. As a percentage of government spending, Australia spends more on defence than Canada, Indonesia, Japan, New Zealand, the Netherlands, Sweden, Germany, France and the United Kingdom.

Moreover, according to DIO, in terms of GDP, Australia spent more on defence in 1998 than many countries that are closer to the vague defined threat from the north than we are. Australian defence expenditure of 1.9 % of GDP compares favourably with that for Malaysia 1.6%, Thailand 1.6%, the Philippines 1.5%, China 1.1%, Canada 1.1 %, Japan 1% and Indonesia 1%. It is less than the 3.1 % spent by Britain but it is more than that for Germany (1.2%) and the Netherlands (1.8%) and is not far behind Sweden (2.1%) and France (2.3%).

It is not as high as that of the US or Singapore or Taiwan or South Korea. But the US is a rich superpower that likes the biggest and best of everything. Singapore, Taiwan and South Korea are confronted by unique geopolitical circumstances that require them to spend more than the average. Australia, however, is in one of the safest locations on the perimeter of the region.

According to DIO, in constant 1995 US$ terms, Australia spent $7.0 billion last year compared to $5.0 billion for Singapore, $2.0 billion for Indonesia, $1.6 billion for Malaysia, $1.3 billion for the Philippines, and $2.6 billion for Thailand. By way of further comparison, China spent $9.7 billion, Sweden $5.0 billion and the UK $33.2 bill.

If the problem is a shortage of troops to deal with peacekeeping in East Timor, Australia should consider rotations comprised of volunteers from other regional countries and in any case, stop taking the lead in challenging Indonesian face.

We should think carefully before we throw money at the Defence Department in a fear-driven, knee-jerk reaction to East Timor. What we should spend more on is competent intelligence collection and analysis. We need a dedicated long term, independent strategic assessments capability that takes account not just of the order of battle of countries like Indonesia or China - the tanks, planes and ships - but also the cultural, historical, geographic, political, economic and other non-military factors that are shaping the strategic outlook for our region.

As an interim solution to our problems with East Timor and Indonesia, we could open northern Australia to all those East Timorese who would like to be free of Indonesian rule. This would plug Australia's northern emptiness, as the Leader of the Opposition, Mr Kim Beazley advocates, and by letting Indonesia re-take East Timor, we would rebuild our relationship with Jakarta and avoid the prospect of a festering guerrilla war.