Australia's response to the threat of global terrorism is a test of resolve

The decision to join the Coalition of the Willing was the right decision. Never again will the Iraqi people have to live with the brutality of Saddam Hussein's tyranny.

We now need to work with the various religious and ethnic groups to ensure they do not choose the preferred path of the terrorists - the path of violence. The international coalition in Iraq wants the same outcome as the Iraqi people: the earliest possible handover of responsibility for Iraq to its own people. Violence can only thwart that process.

The international community's decisions on how to grapple with the issue of transition will be crucially important for the broader war against terrorism. The broadest possible support will create the best possible chance for steady, peaceful progress. Unity on Iraq will send a clear and strong message to the terrorists - who feed on our divisions and signs of weakness.

Just as we had to make a stand against fascism in the 1930s and 40s we must take a stand against the Islamo-fascists of the 21st century. Terrorists will not be defeated by acquiescence and retreat - victory can only come by taking them on directly.

Two and a half years after 9/11 it is possible to describe some progress against terrorism. Across 100 countries about 3,400 terrorist operatives have been either killed or detained. Entire al-Qaeda cells have been disrupted. Almost US$200 million in terrorist assets have been frozen or seized. In our own region, well over 200 Jema'ah Islamiyah suspects have been detained with key figures like Hambali and Al-Ghozi no longer at large.

But there is ample evidence of increasing coordination among terrorist groups. JI, for instance, is cooperating with Islamic extremist groups in the southern Philippines, to the point of sharing training facilities and operational expertise. Terror cells are planning for the medium and long term.

It is crucial that we challenge the ideas by which terrorists seek to justify their actions. Otherwise we vacate the important intellectual battleground in the war against terrorism - allowing terrorists to exploit the politics of despair.

This is not to accept the simplistic idea that terrorism has so called "root causes" that are easily identified and resolved. The idea that terrorism is driven by poverty and lack of opportunity is not supported by the facts. A number of the leaders of al-Qaeda and JI come from relatively affluent and privileged backgrounds. The "root causes" thesis also misunderstands the purposes of groups aligned with al-Qaeda.These are not people seeking remedy or compromise - only annihilation or subjugation to their views.

We must always draw clear distinctions between terrorism that seeks to exploit Muslim populations on the one hand and Islam itself on the other - on 9/11 it wasn't only planes that were hijacked but the Islamic faith as well.

Australia has taken steps to promote understanding between Muslim and non-Muslim societies. The Australia-Indonesia Institute (AII) is promoting understanding through its Inter-Faith Program, which encourages contact between our countries' Islamic and Christian organisations. In 2003 the Council for Australian-Arab relations was formed to promote economic, political, cultural and social links between Australian and Arab communities.

Since September 11 and Bali, about $3 billion has been committed to protecting Australia against the new terrorist threat. Recently the Prime Minister announced that Australia's intelligence, security and law enforcement agencies would receive an additional $400 million to strengthen our campaign against global terrorism.

No country can combat terrorism on its own - it is only through cooperation that we will get the fullest possible picture of the current and emerging nature of terrorism - and how best to fight it. Cooperation between Muslim and non-Muslim countries has been vital in the progress so far.