Can you please briefly discuss the state of geopolitics and international relations in the region?

The geopolitical situation in East Asia is a state of some challenge. The reasons are as follows. Firstly, it is a region characterized fundamentally by many unresolved territorial disputes, whether itís between Russia and Japan, North Korea and South Korea, China and Japan, China and Taiwan, some resolved matters in Southeast Asia such as between Thailand and Cambodia, and others. Then you have the big two: India and China and India and Pakistan. So unlike in Europe, the challenge to existing security is the non-resolution of longstanding border disputes. Secondly, a number of states in the region also possess nuclear weapons. This compounds the complexity. North Korea, China, India, and Pakistan are all nuclear states. The third reason is that since WWII, the underpinning security foundation of Asia Pacific is the strategic role of the United States and its alliances, Korea, Japan, Australia, New Zealand, the Philippines, and Thailand. But with the rise of China, we have a new dynamic in maritime East Asia. The growth of Chinese naval capabilities affects issues concerning Taiwan, China is developing a greater strategic footprint in East Asia due to its expanded military capabilities, and China has been rubbing up against the United States more and more. Additionally, Chinaís long-term territorial dispute with Japan has recently become a major diplomatic dispute over the South China Sea. The challenge for the United States is to deal with these dynamics while respecting Chinese-Americans and ensuring peace.

What is the first step towards overcoming conflicts in the region, especially when many of them are grounded in historical tensions?

Letís consider the Senkaku/Diaoyu island dispute between Japan and China. There are many ways to respond to that. First is to do nothing and allow the conflict to drift. The problem with that is the conflict may escalate. The second approach is to apply external military diplomatic and political pressure either against Japan or against China to force a resolution short of military conflict. The problem with that is it is likely to create a harder reaction from either side than the reverse. Third is to persuade both sides to step back through private diplomacy to find a temporary means to put the island dispute into a different process for the long-term future. On a broader level, because the competing nationalism between Asia Pacific states is strong, it is wise to begin developing a pan-regional institution to curb the edge of some of the nationalism. As I have promoted in 2008, there should be an establishment of the Asia Pacific Community. The community would address political, economic, and security concerns with the objective being to build new confidence and security across East Asia. This is similar to how the Europeans did it step by step in the 1950s, finally forming the European Union. This turned countries that had been enemies historically into close partners, namely France and Germany. Similarly, the Asia Pacific Community would allow Asia Pacific countries to reduce perceptions of differences, construct public goods, enjoy the benefits of collective cooperation, and avoid seeing wars as a natural means of statecraft.

What is the first step towards achieving the Asia Pacific Community you described?

The first step has already been taken by ASEAN, which made up 10 of 18 countries in East Asia. The community was first formed in the 1960s. In the beginning, the thought of communist Vietnam, Cambodia, and Laos working closely with the military dictatorship in Indonesia, Singapore, and Malaysia appeared to be impossible due to the sharp differences in political ideology. However, ASEAN was able to change that over time. The second thing that has been done is the creation of the East Asian Summit or EAS in 2005, which included the 10 ASEAN countries, China, Japan, Korea, Australia, New Zealand, India, and in 2010 the United States and Russia. The purpose is to create an open table so that we can discuss for the first time any political, economic, security, and environmental conditions. My proposal is to build an Asia Pacific Community out of this existing structure.

What is currently the biggest challenge in creating this Asia Pacific Community?

Political will. But I believe that the formation of the Asia Pacific Community could be a new global public good conducted conjointly between Americans and Chinese in addition to local countries in the region. Australia has done most of the diplomacy underpinning this in 2010-2013 while I was Prime Minister but now it has to be taken up by regional countries as well.

With this new community, what do you foresee as the change in the role of the United States in the region?

The United States made its strategic position in the region clear in 2011 that it will stay militarily engaged in the region in the long-term future, particularly through its naval assets, reinvigoration of its bilateral security alliance, and addition of a new economic offensive through partnerships to promote free trade in the region. America is already forth leaning with questions regarding a regional community with one remaining challenge in turning existing thin institutions such as the East Asian Summit into a thick one with multiple levels of collaboration.

Can you give a concrete example of what the Asia Pacific Community would entail?

A practical example Australia has put forward in 2011 is that all military in the region should establish a region-wide protocol for combatting the next series of natural disasters. This would serve to both promote collaboration and practical disaster prevention in the region.

What is a common misconception the West has on understanding the situation in Asia Pacific?

I think the problem with national perceptions is that they are all inaccurate. Our experience and culture shape our perceptions of the world. But more specifically, one problem is with China. Chinaís perception is that American strategy is about containment and American perception is that the rise of China is automatically a threat to the United Statesí continued strategic presence in the region. These are deep misperceptions that both need to deal with.

What do you think will help increase the global competitiveness of the Asia Pacific region?

One of the pieces of policy Iíve been working on is the comprehensive TPP, or Transpacific Partnership. It is a free trade agreement that would allow a much more level playing field between the economies of East Asia and therefore greater imperatives towards competitiveness rather than subsidization of individual national economies. A free trade area means you go out there and compete based on who got the best products and services rather than who got the most efficient official or unofficial protection structures.