Australian Capital City Property Development,Foreign Investment and Investor Attitudes

Recently there has been a substantial change in the role of foreign investment in urban property development in Australia. Now, about 50% of foreign investment each year is directed to urban property sectors, with Asian investors accounting for approaching 50% of this investment. This trend has coincided with the re-emergence of the property development sector from the trough of a recession in the early 1970s to something approaching a boom in the last two to three years. While there are considerable variations in the performance and prospects of the various capital city property markets, Australia is seen in general terms as being a favourable place for foreign investment in urban property development, particularly as a destination for long term equity investment. This paper examines recent trends in capital city property markets in Australia, and in particular the increasing importance of foreign investors. It also discusses the results of a national survey of property developers, investors and intermediaries, and investors, both local and foreign, and reports on their attitudes towards the various capital city property markets, and their investment behaviours. Attitudes towards the Foreign Investment Review Board (FIRB) guidelines and controls are examined, and it is suggested that there is room for further substantial deregulation to encourage direct foreign investment in Australian urban property development.     

Australia and the promise and the perils of humanitarian diplomacy

ABSTRACT

Humanitarian diplomacy has always been a crucial element of humanitarianism, however it is now becoming a more prominent element of states’ foreign policies. It holds many attractions and much promise. It provides states with a way of expressing important qualities of international empathy and solidarity and can also enhance a state’s international reputation and provide valuable means for building relationship of trust and cooperation. This can in turn can be conducive to a state’s broader foreign policy objectives. However, there are also perils to the incorporation of humanitarian diplomacy into a state’s foreign policy. It can generate ambiguity and even conflict within a state’s diplomatic endeavours due to tensions between humanitarian and broader national interests. In exploring these issues it is useful to distinguish between humanitarian diplomacy and humanitarianism as diplomacy. This article explores these issues in relations to Australia’s diplomacy. It argues that Australia has actively engaged in humanitarian diplomacy and humanitarianism as diplomacy. Whilst the two are often complementary, there are areas in which they have been in tension and even at odds. This has implications for Australia’s international reputation but also for its capacity to undertake genuine and effective humanitarian action.     

Timor-Leste’s foreign policy approach to the Timor Sea disputes: pipeline or pipe dream?

Over recent years, Australia and Timor-Leste’s bilateral relationship has been consumed by contested maritime boundary claims in the resource-rich Timor Sea. Intractable disagreements over the right to build a petroleum export pipeline have led Timor-Leste to reinvigorate its pursuit of permanent maritime boundaries as ‘a national priority’. This article examines Timor-Leste’s interests in the Timor Sea and assesses its strategies for achieving its foreign policy goals. It argues that Timor-Leste’s attainment of its stated goals relies on Australia shifting its Timor Sea policy, which has been largely consistent since the 1970s. Timor-Leste’s key strategy is a public diplomacy campaign that positions permanent maritime boundaries as the final stage of its independence struggle, and presents Timor-Leste as owning the disputed Greater Sunrise gas field under international law. While the public diplomacy campaign aims to win enough Australian ‘hearts and minds’ to put pressure on the Australian government, it ultimately fails to negotiate the strategic and historical realities of the interests that define Australia’s realpolitik approach to the Timor Sea.     

The uncertain merger of values and interests in UK foreign policy

How should ethics and values relate to the British national interest? The idea that ethical commitments to distant non‐citizens should occupy a position within British foreign policy was a controversial element of Labour's foreign policy during the early part of their 1997–2010 tenure. Rather than undermining traditional national interest concerns, one of the defining themes within Labour's foreign policy was that values and national interests were becoming increasingly merged in a globalized world. The post‐2010 coalition government has made distinct efforts to differentiate themselves from their predecessors, crafting a more pragmatic and national interest‐based foreign policy approach. Despite this, significant continuities with Labour's ‘ethical dimension’ are evident and many associated policies and practices have survived the transition. Moreover, the suggestion that British values and interests are interrelated and mutually reinforcing has been re‐asserted, with renewed vigour, by coalition policy‐makers. The article traces the ways in which values and interests have become increasingly merged in the language of recent British foreign policy and examines the implications for our understanding of the UK's national interest. It argues that the idea of an almost symbiotic relationship between values and interests is fundamentally unhelpful and makes the case for greater disaggregation of the two. Although a zero–sum game need not exist between core national interests and ethical obligations abroad, the suggestion that they are mutually reinforcing obscures the tensions that frequently arise between these different realms of obligation. Using the examples of failed state stabilization and UK arms trade regulation, the article demonstrates how uncritical acceptance of the values–interests merger risks producing unstable policy formulations.     

The regulation of direct foreign investment in the Australian mining sector

Although Australia has relied on foreign capital and multinational corporations to develop its mining sector, it has been successful in restricting foreign ownership and control to 50 per cent The Australian experience provides a valuable case study because its successive minerals and energy booms in the last two decades occurred before and after restrictions were imposed and the Foreign Investment Review Board established in the mid‐1970s. During the prior minerals boom when there were virtually no restrictions, levels of foreign ownership and control increased from less than 30 to 50 per cent. During the second energy boom, in the late 1970s to early 1980s, a firm policy of 50 per cent Australian participation in all mining projects was successfully implemented. Australia did not become a ‘client state’ of international capitalism, nor did its federal system preclude the regulation of foreign investment The article summarises the results of Australia's regulatory policy and examines the political and policy reasons for its success.     

Australia's relationship with the United States: the case for greater independence

A number of recent events—especially attempts to negotiate a bilateral trade agreement and Australia's participation in the conflicts in Afghanistan and Iraq—have thrown Australia's relationship with the United States into sharp relief. While this relationship has historically enjoyed strong bilateral endorsement, such uncritical support is beginning to unravel. At the very least, the relationship is being subjected to a renewed, more critical scrutiny. This paper argues that a dispassionate analysis of the relationship is appropriate and overdue. Not only are the benefits that accrue to ‘Australia’ from the relationship debateable, even when judged within the limited calculus of the ‘national interest’, but Australia's uncritical support for US foreign policy is also helping to entrench potentially damaging aspects of American foreign policy and— somewhat ironically—undermining the legitimacy of its pre-eminent ‘hege monic’ position.     

Resource nationalism or resource liberalism? Explaining Australia's approach to Chinese investment in its minerals sector

Since 2005, a burgeoning wave of Chinese investments has set off a new ‘minerals boom’ in the Australian iron ore and coal mining sectors. While normally a welcome development, the state-owned and strategic nature of the investors has raised concerns in Australia about how these should be regulated. As a result, in February 2008 the Australian government declared an intention to more closely screen foreign direct investment (FDI) from state-owned sources, which both supporters and detractors alike have claimed is evidence of ‘resource nationalism’ in Australia's approach towards its trade and investment relationships with China. This article challenges this understanding through an examination of the characteristics of Chinese mining FDI, the dilemmas these present to the Australian government, and the relatively restrained nature of its response. Through this, Australia's FDI policy is explained as a defensive move against the potential for strategic behaviour by Chinese investors resulting from their state ownership, rather than any national program to subject minerals trade and investment to political control. On this basis, the article argues that Australian government policy instead evidences a ‘resource liberalism’ approach, which intends to ensure that the governance of Australia's minerals trade and investment with China remain market-based processes.     

Trumping foreign policy: public diplomacy,framing, and public opinion among middle power publics

Even as the world’s sole superpower, the United States requires the cooperation of other states to achieve many of its foreign policy objectives. The President of the United States thus often serves as ‘Diplomat in Chief’ in public diplomacy efforts to appeal directly to publics abroad. Given Donald Trump’s antagonistic approach to foreign relations and widespread lack of popularity, what are the implications for support for US policy among publics abroad – particularly among middle power states allied to the US? While previous research on public opinion relying on observational data has found that confidence in the US President is linked to support for American foreign policy goals, the mechanisms at work remain unclear. Using original data from survey-based experiments conducted in Canada and Australia, this article seeks to clarify the effect of ‘presidential framing’ (presenting a policy goal as endorsed or not endorsed by Trump) on attitudes toward key policy issues in the Canada–US and Australia–US relationships. Results point to a negative ‘Trump framing’ effect in Canadians’ and Australians’ trade policy attitudes, but such an effect is not observed in other policy domains (energy policy in Canada, and refugee policy in Australia).     

Recent Trends in the Internationalisation of the New Zealand Economy

Over the last decade, but particularly since 1984 when the fourth Labour Government came to power, New Zealand has become something of an experimental test bed for the implementation of monetarist ideas of political and economic management. A noticeable outcome of the policy regime recently put in place has been a dramatic ‘opening up’ of the economy as markets are deregulated, protection barriers lowered, and restrictions on movement of capital in and out of the country removed One consequence has been a quantitative and qualitative change in the internationalisation of the economy. This paper traces the nature and extent of this process, and speculates on some policy implications. Four key dimensions of the internationalisation process are surveyed: the expansion of New Zealand capital off-shore, increased levels of foreign investment in New Zealand, the impact of reductions in border protection, and closer economic relations between Australia and New Zealand.     

The art of integration: probing the role of cultural policy in the making of Europe

Mirroring Jacques Delors’ much quoted ‘No one falls in love with a common market,’ there has been an increased emphasis on ‘culture’ as a vital tool in the European Union (EU) integration process. Yet, how these programs for ‘cultural exchange and dialogue’ affect artistic production, and reception, is rarely discussed. Drawing on interviews with actors in Berlin and Istanbul who engage with cultural policy in the European arena (2005–2008), this paper aims to illuminate the tensions that this nascent European cultural policy has engendered, not least with regard to the EU stipulations on national cultural sovereignty. I argue that while EU cultural initiatives indeed produce a kind of ‘Europeanization,’ they do so mainly through thematic and institutional incorporation. However, this type of integration tends to recast power differentials within the EU and beyond, despite proclaimed goals to the contrary, as cultural exchange programs tend to reinforce distinctions between ‘art proper’ and ‘ethnic cultural production.’     

Power in Australian foreign policy

The 2017 Foreign Policy White Paper emphasises the importance of ‘maximising’ Australia’s power and influence. However, the White Paper and much of the commentary on Australian foreign policy do not clearly conceptualise ‘power’ or indicate how it ought to be increased. The Lowy Institute’s recent Asia Power Index implies one possible strategy via its resource-based approach to measuring power. We outline a different approach and argue that power should be conceptualised and evaluated as a specific relationship causing behavioural change, rather than as a general attribute of its wielder. To complement the Lowy Institute’s carefully catalogued database, and facilitate a more focused conversation about maximising power and influence in Australian foreign policy, we offer a typology identifying five pathways through which states can translate their material and non-material resources into outcomes that serve the national interest.     

A good international citizen? Australia at the World Summit on Sustainable Development

Australia has often been identified as a middle power in foreign policy terms. This article assesses the worth of the concept in understanding the role of Australia in global environmental governance. Using a case study of the role played at the World Summit on Sustainable Development, it assesses whether Australia conformed to a classic middle power role, building coalitions as a ‘good international citizen’ or whether its role was more like a veto state, preventing positive change. This is done via a reflection of Australia's Summit priorities and an assessment of its impact over the Summit outcomes. The article shows that Australia was able to offer leadership in certain specific areas, but overall domestic policy preferences, a growing mistrust of multilateralism, and a strong defence of the national interest meant that Australia played the role of a veto state, often in coalition with the United States of America.     

Overcoming legacies of foreign policy (dis)interests in the negotiation of the European Union–Australia free trade agreement*

ABSTRACT

Despite a troubled trade history dominated by disputes over agriculture, the negotiation of a European Union (EU)–Australia free trade agreement (FTA) was initiated in 2015. The initiation of these negotiations was made possible because of the shift in EU trade policy towards the negotiation of what the EU terms ‘new generation free trade agreements’. The EU has concluded FTA negotiations with South Korea, Singapore, Vietnam and Canada, and is negotiating other FTAs— notably with Japan and the USA . The EU faces many commercial challenges to its FTA negotiations that go beyond tariff reduction, including the protection of its geographical indicators, public procurement and investor–state dispute settlement. These issues are likely to be substantial features of any EU FTA with Australia. In addition to these challenges, the promotion of sustainable development interests and human rights through FTA negotiations is an important component of the EU’s approach. The EU’s position on the trade-related aspects of sustainable development and the negotiation of human rights conditionality has presented significant challenges to the EU’s trade agenda, particularly in negotiations with Canada and Singapore. This article draws lessons from the EU’s new generation trade agreement negotiations to date. It compares these negotiations with Australia’s approach to FTA negotiations, and analyses potential stumbling blocks for an EU–Australia FTA in light of past tensions in the relationship. The article argues that shifts in both EU and Australian trade policies and positive developments in the relationship mitigate past obstacles to a negotiated agreement. However, EU– Australia relations still suffer from the tyranny of distance. The resulting deficit in foreign policy salience between the EU and Australia broadens the best alternatives to a negotiated agreement.     

The long shadow of apartheid: a critical assessment of heritage transformation in South Africa 25 years on

ABSTRACT

Based on insights gained from two decades of research on South African heritage and monuments, this paper critically reflects on the status quo of heritage transformation in South Africa 25 years after the end of apartheid. It assesses new directions in national heritage policy and government strategy in relation to recent developments around post-apartheid heritage and the popular demand for a removal of ‘colonial statues’, which gained impetus from the #Rhodes Must Fall campaign. It is argued that the government’s approach to heritage transformation and most notably its treatment of white minority heritage, dominated by the ‘juxtaposition model’, has had limited success. The paper illustrates how heritage and the memory of the past are entangled with socio-political and economic realities in the present, which in turn is overshadowed by the long-term effects of apartheid and impacted by global or transnational considerations, such as foreign investment and tourism.     

Heading west? Georgia's Euro‐Atlantic path

Events in Ukraine in 2014 are likely to transform the presence and role of western institutions such as NATO in the post‐Soviet area. The crisis has starkly revealed the limits of their influence within Russia's ‘zone of privileged interest’, as well as the lack of internal unity within these organizations vis‐à‐vis relations with Moscow and future engagement with the area. This will have long‐term implications for the South Caucasus state of Georgia, whose desire for integration into the Euro‐Atlantic community remains a key priority for its foreign and security policy‐makers. This article examines the main motivators behind Georgia's Euro‐Atlantic path and its foreign policy stance, which has remained unchanged for over a decade despite intense pressure from Russia. It focuses on two aspects of Georgia's desire for integration with European and Euro‐Atlantic structures: its desire for security and the belief that only a western alignment can guarantee its future development, and the notion of Georgia's ‘European’ identity. The notion of ‘returning’ to Europe and the West has become a common theme in Georgian political and popular discourse, reflecting the belief of many in the country that they are ‘European’. This article explores this national strategic narrative and argues that the prevailing belief in a European identity facilitates, rather than supersedes, the central role of national interests in Georgian foreign policy.     

The democracy tradition in US foreign policy and the Obama presidency

This article proposes a three‐level analysis of the democracy tradition in American foreign policy that identifies its ideational, strategic and policy dimensions and situates Barack Obama's presidency to date within it at each level. At the heart of this approach is the understanding that the motivations and practice of the United States' democracy promotion are shaped by its ideas about national identity, political order, national interest and international relations. This is the ideational source of the democracy tradition, which, as US power has grown, has led increasingly to decision‐makers setting strategic goals that include democratization abroad as a facilitator of other US goals. Only slowly has this led to the development of specific policies to that end, though, and democracy promotion as a discrete policy field mostly developed from the 1980s onwards. Democracy promotion went through a ‘boom’ after the end of the Cold War as the United States enjoyed unparalleled power on the international stage. It is clear that Barack Obama and his administration belong firmly in the democracy tradition at the ideational, strategic and policy level, and they have given no cause to expect any major change in his second term as far as democracy promotion is concerned. It is in any case a mistake to think that changes in the democracy tradition come from particular leaders; rather, it is the changing international environment confronting US foreign policy that is more likely, in the longer term, to lead to a shift away from democracy promotion.     

Going to war democratically: lessons for Australia from Canada and the UK

This article addresses the role of democracy in Australia’s foreign policy formation. It argues that public debate and deliberation on foreign policy is a normative good. When there is a lack of debate on a government decision, a democratic deficit occurs. Such a deficit is evident in the way Australia goes to war; however, the examples of Canada and the UK show that reforming parliamentary practice is possible. In the context of the ‘war on terror’, this article compares Australia, Canada, and the UK from 2001 to 2015 with regards to ‘war powers’. Drawing from debates recorded in Hansard, it finds that while Canada and the UK took steps to ‘parliamentarise’ their foreign policy formation, the war-powers prerogative of the Australian government remained absolute. It concludes that increasing the role of parliament may go a long way towards democratising the decision of when Australia goes to war. This has practical as well as normative benefits, since it may prevent governments from entering wars that are unsupported by the public. At minimum, it will compel governments to engage more thoroughly in public debate about their proposed policies, and justify their decisions to the nation.     

Do we need more economics in Australian economic diplomacy?

ABSTRACT

Economic diplomacy—that is, informal and formal processes and links between states and non-state actors on international economic issues—is a current focus of Australian foreign policy. The Department of Foreign Affairs and Trade’s stated economy diplomacy aims are liberalising trade, boosting economic growth, encouraging investment and assisting business. If Australia is to embrace a genuine and effective notion of economic diplomacy there are two problems to be overcome. First, DFAT’s economic diplomacy framework is incomplete and misses the bigger economic picture, particularly the role of Australia’s key economic agencies, Treasury and the Reserve Bank of Australia. Second, DFAT does not consistently apply economic principles to foreign affairs issues including trade, foreign aid and the global investment agenda. Going forward, Australia should abandon the focus on the four narrow pillars and instead focus on developing a clear, coordinated international economic strategy that articulates Australia’s core international economic objectives and priorities.     

Australia and the challenges of order-building in the Indian Ocean region

This article considers the regional order-building challenges that Australia presently confronts in the Indian Ocean region (IOR). The author argues that while regional stability within the IOR constitutes an increasingly important Australian security interest, policy makers will struggle to translate the order-building strategies they have previously pursued in East Asia into an Indian Ocean context. In East Asia, Australia has historically pursued a ‘dual track’ order-building strategy centred on its participation in a US-dominated ‘hub and spokes’ alliance system alongside multilateral regional engagement. The absence of an equivalent alliance system or an established tradition of multilateral security diplomacy conversely precludes an extension of this strategy into the IOR. Growing tensions between the USA and China and between China and India, meanwhile, further complicate IOR security dynamics, while underscoring the urgent need for a more coherent approach to regional order-building. With these challenges in mind, the author concludes by proposing a range of bilateral, minilateral and multilateral initiatives that Australia should pursue to stimulate the emergence of a more cooperative IOR security environment.