It is my pleasure and honor to present my thought today on the occasion of the 6th IISS Asia Security Conference, or Shangri-la Dialogue. I would like to extend my gratitude to Dr. John Chipman, Director of IISS, and his staff, who gave me this opportunity, and thank also the Government of Singapore, which has been hosting this Conference from the outset. The fact that this dialogue has been held regularly and that high-level participants in Asia-Pacific have been exchanging their views on security issues has significance in enhancing regional security through confidence building. Though the situation of this region is different from that of Europe where a multi-layered framework for stabilizing security environment exists, there are movements and initiatives towards improving the security situation in this region through efforts of the countries concerned. I would now like to touch upon the major development of Japan's defense policy. From January this year, the Japan Defense Agency became the Ministry of Defense. In addition, the International Peace Cooperation Activities was upgraded to a primary mission of the Self-Defense Forces in the course of the transition. As for myself, I am participating in this conference for the first time as the first full-fledged Minister of Defense of Japan. Such transition demonstrates, both at home and toward outside, the determination to strengthen the Ministry's policy-making capability in order to cope with issues for peace and stability of the international society and to meet the expectations of the international community. I would like to stress here that we continue to firmly adhere to the basic defense policies of Japan such as exclusively defense-oriented policy and three non-nuclear principles. Nuclear challenges, which is the topic of this session, is one of the serious security problems we face now. I personally follow the issue attentively, since I grew up in Nagasaki, the only place together with Hiroshima in the world where an atomic bomb led to a disastrous end. Japan, as the only country suffered from atom-bombing, has been making strenuous efforts towards a peaceful and safe world free from nuclear weapons. Japan attaches vital importance to Nuclear Non-Proliferation Treaty (NPT) as an essential basis of realizing international nuclear disarmament and non-proliferation regime, since the treaty is the most universal vehicle with 189 parties in the area of disarmament and non-proliferation. We should maintain frameworks for non proliferation of Weapons of Mass Destruction including NPT, and should proceed toward nuclear disarmament through a practical and incremental approach. At the same time, there still exist, in reality, considerable military powers including nuclear weapons and many destabilizing factors in the international community. Based on this understanding, the basic policy of Japan on nuclear issue is, as stated in the National Defense Program Guidelines, to continue to adhere firmly to the three non-nuclear principles, that is, the policy of not possessing, not producing and not permitting the introduction of nuclear weapons into Japan, and at the same time, to respond properly to nuclear threats by establishing a necessary defense force posture, including the introduction of Ballistic Missile Defense Systems, in addition to relying on the nuclear deterrence of the United States. Furthermore, nuclear threats have become more complex today; the international society is increasingly aware of the danger of the transfer and proliferation of Weapons of Mass Destructions and Ballistic Missiles, especially when they are handed over to non-state actors such as international terrorism organizations. With the progress of globalization through rapid development of communication and transportation, as well as growing interdependence among states, a threat to a certain state may easily be spread to other part of the world. Security issue is no longer confined to a concern of a certain area and cannot be conceptualized only in the context of state-to-state conflict. Thus, we have to cooperate and take responsible measures to prevent the spread of such a threat. Despite serious economic difficulties, North Korea allocates its resources primarily for military and maintains and enhances combat readiness and military capabilities including WMDs, Ballistic Missiles and Special Operations Forces. Such development constitutes serious destabilizing element not only for Japan but also for the region as a whole. In addition, North Korea launched seven ballistic missiles last July and announced a nuclear test last October. This series of activities obviously constitutes a threat to peace and security of the international community. Such perception is shared in the international community, and the United Nations Security Council adopted unanimously the Resolution 1718 which condemns the acts and provides measures need to be taken by North Korea and the international community shortly after the announcement of the nuclear test by North Korea. On North Korea, there are not only nuclear issues, but also issues of ballistic missiles as means of delivery of WMDs, as well as human rights issues including abduction of Japanese nationals. Japan is seeking to resolve all these remaining issues comprehensively through the various measures including the Six-Party Talks. Japan does not participate in energy assistance program to North Korea until we observe the development of bilateral relations including resolution of abduction issues. Taking into account the possibilities of proliferation of nuclear and missile technologies as well as universality of human rights issues, those are not the bilateral issues for Japan and North Korea or within the region, but also issues of common interest for the international community as a whole. We therefore have to urge North Korea in unison to respect and obey the rules of international community. Lastly, I would like to touch upon some measures taken by the Ministry of Defense and the Self Defense Forces as our effort to respond to those developments. As I mentioned earlier, today, security of a nation is closely interrelated to those of others. In addressing the nuclear issues, it is necessary for the international community to engage in broader cooperation. An example of this cooperation is the Proliferation Security Initiative (PSI). It is necessary for countries to work together with concerted efforts, proactively and positively, to ensure non-proliferation of WMDs by PSI activities which involve broad security issues such as defense, diplomacy, law enforcement and export control issues. Japan has supported and participated in the initiative from the outset, May 2003, and will continue to contribute actively to strengthen the framework. Furthermore, the Ministry of Defense and the Self-Defense Forces have been maintaining multi functional, flexible and effective defense capabilities to cope with diverse and complex threats today. As a part of that, efforts are made to establish effective responsive capability to WMD attack, which could discourage those who contemplates imposing threat by WMD. For example, Japan has started instituting the Ballistic Missile Defense (BMD) System together with our ally, the United States. The threat of Ballistic Missiles becomes even more serious when they are combined with WMDs. While Japan had started joint research of BMD in the 90s with the United States, public awareness was increased after North Korea launched a missile over Japan in 1998. Taking into account of proliferation of WMD and Ballistic Missiles thereafter and the technical viabilities of the BMD system being confirmed, Japan decided to introduce BMD in 2003. The basic concept of the system is to operate a multi-tier interception by a combination of the Aegis BMD system at the upper-tier and the Patriot system at the lower-tier. The system makes use of the existing SDF capabilities. First PAC-3 was deployed this March as the first component of BMD capabilities, and the first Aegis destroyer equipped with SM-3 missiles will be deployed this December. Meanwhile Japan has started joint cooperative development of advanced SM-3 missile with the United States. It is a pressing necessity to sustain unit operational capability as well as to create a posture to minimize damage in the event of WMD attack. Japan is working with the United States to enhance capability in this regard. Through such multi-layered efforts, we hope that measures to counter the nuclear threats will become more effective and an attempt to threaten the international community will become more likely to fail. Let us work together and continue our efforts for the brighter future by taking one small step further, if not one giant leap. Ladies and gentlemen, I would like to begin by thanking Dr. John Chipman, Director General of IISS, and the government of the Republic of Singapore for providing us with this invaluable forum of discussion. Today, I would like to address you on the challenges and opportunities raised by the North Korean nuclear issue; one of the most pressing security matters for the international community, and especially for Northeast Asia. The end of the Cold War and the subsequent trend of globalization have increased exchange across national borders and have intensified mutual dependence between them. These changes necessitate a peaceful and cooperative order in Northeast Asia. The North Korean nuclear issue is an aberration of the flow of the times, representing a serious challenge to the peace of Northeast Asia and the world. In my address, I would like to discuss how the international community can come together to overcome the challenge of the North Korean nuclear issue. Furthermore, I would like to offer you my thoughts on how we can convert this challenge into an opportunity to establish a new security arrangement in the region. North Korea's nuclear program disrupts the military balance of the Korean peninsula, increases the possibility of a nuclear domino effect in Northeast Asia, and poses a serious challenge to the international community's WMD non-proliferation efforts. UN Security Council Resolution seventeen eighteen, adopted unanimously in the immediate aftermath of last year's North Korean nuclear test, reinforced the notion that the North Korean nuclear issue is a matter of international security; untenable and requiring urgent resolution. In the midst of these developments, the February 13th agreement of this year's six-party talks spelt out the initial actions to implementing two thousand and five's "September 19 joint statement." As you will recall, the September 19 joint statement laid out a blueprint for resolving the North Korean nuclear issue. The February 13th agreement raises the possibility of fundamentally lifting the shadow of tension and danger the North Korean nuclear issue casts on the Korean peninsula. Despite complications and difficulties along the way, the six-party talks are opening a window of opportunity to settle the North Korean nuclear issue and to usher in a new order of peace and security in the region. Agreements reached through the six-party talks process can be distinguished from the nature of previous agreements by virtue of two innovations to the talks: one, 'reaching agreements through the deliberations of a multilateral cooperative body,' and two, the adoption of a 'comprehensive approach' to the talks. If I may elaborate on the first innovation, the six-party talks are composed of all affected parties to the North Korean nuclear issue and operate as a framework for multilateral consultation and international cooperation. The six-party talks process is flexible enough to allow bilateral consultation within a larger multilateral framework, while also providing room for mediation and compromise between the parties to the talks. Moreover, because agreements at the six-party talks are reached under the consensus of all parties, their implementations have a certain binding power. Through its capacity to promote international cooperation, the six-party talks stand as the only consultative body capable of conceiving and realizing a workable and fundamental solution to the North Korean nuclear issue. As to the second innovation, the approach of the six-party talks can be characterized as comprehensive because they encompass a variety of political, economic, and security discussions in dealing with the North Korean nuclear issue. The North Korean nuclear issue is complicated by several factors including North Korea's perception of its own security and the environment for sustaining its regime. The foreign strategies of regional players with a stake in the nuclear issue as well as their policies towards the Korean peninsula are other factors. Because multiple factors are in play, the efficacy of narrow ranging solutions to the North Korean nuclear issue is limited. What is therefore required is a comprehensive approach; an approach that deals with the nuclear issue in conjunction with political, economic, and security-related topics pertaining to the Korean peninsula. Along these lines, the approach of the February 13th agreement qualifies as having been comprehensive because in addition to seeking a new order of peace and security in the region through dealing with the North Korean nuclear issue, it dealt with others as well. These other issues include the normalization of relations between the US and North Korea, and between Japan and North Korea, as well as the settlement of a permanent peace regime on the Korean peninsula. The comprehensive approach of the February 13th agreement is what gives it significant meaning. The effort to denuclearize the Korean peninsula through the six-party talks is in effect an effort to create an opportunity; an opportunity for realizing a future, stable security order in Northeast Asia. However, windows of opportunity leading to futures of hope and promise tend to be fragile. That is why it is so important to stably manage the process of realizing the future goal of a denuclearized Korean peninsula. To that end, I believe there are three important points to remember. First, the six-party talks should be, in no uncertain terms, firm and uncompromising on the principle and objective of solving North Korea's past, present, and future nuclear ambitions and the products thereof. Despite promising to abandon its nuclear programs through the 1994 Geneva "Agreed Framework between the United States of America and the Democratic People's Republic of Korea," North Korea reneged on its promise in subterfuge. This broken promise culminated in last year's underground nuclear test. If we were to approach the North Korean nuclear issue as a stitch repair exercise limited to mere non-proliferation efforts without seeking a fundamental solution, we would be guilty of repeating the errors of history. It follows that the denuclearization of the Korean peninsula through the complete eradication of North Korea's past, present, and future nuclear programs and their byproducts should be the principle and objective under which the six-party talks operate. Concessionary political deal-making or compromise, in any way allowing North Korea to possess nuclear weapons contravening this principle and objective should not be allowed to pass. This view is shared by North Korea's counterparts at the six-party talks. Second, the process of denuclearizing the Korean peninsula will only succeed when all parties to the talks adopt a patient and mutually cooperative posture. Despite the sufficient presence of will and commitment by the interested parties, progress on the February 13th Agreement is proving laborious because of technical difficulties related to the Banco Delta Asia issue. However, the inordinate amount of time and effort spent on solving this snag offers many suggestive points. One prominent point is that there will be many unforeseen difficulties along the road to fully eradicating North Korea's nuclear weapons and programs. Another is that navigating these obstacles will require a great deal of patience, cooperation, and coordination between the parties to the talks. Therefore, the process of denuclearizing the Korean peninsula will move forward stably when all Third, it is critical to ensure that anxieties over security in what is already an uncertain and fluid denuclearization process do not occur. What we should always keep in mind in seeking a solution to the North Korean nuclear issue is the fact that today's peace and security cannot be sacrificed for tomorrow's, which are by no means guaranteed. In other words, we must make sure that peace and stability in the Northeast Asia region are not negatively affected, and that no security crisis is allowed to befall the Korean peninsula in the process of dealing with the North Korean nuclear issue. In adherence to this line of thinking, the Republic of Korea armed forces actively support the Korean government's policy of endeavoring a peaceful resolution of the North Korean nuclear issue, all the while maintaining its deterrence capability and crisis management posture vis-à-vis the North Korean nuclear threat. Put differently, the Korean armed forces retain an autonomous conventional deterrence posture against North Korea, coupled with a nuclear deterrence capability afforded by the US nuclear umbrella. Moreover, the Korean armed forces maintain a crisis management posture in preparation for an unanticipated deterioration of the situation on the peninsula. In this way, it is important to remember that in dealing with the North Korean nuclear issue, deterring today's security threats and mitigating those of tomorrow require the careful management of the North Korean nuclear weapons and programs liquidation process. Under the firm principle that North Korean nuclear weapons and programs cannot be sanctioned, the Korean government is taking an active role in the six-party talks to find a peaceful and diplomatic solution to the North Korean nuclear issue. Coupled with these diplomatic efforts, the Korean government is strategically conducting inter Korean dialogue to run parallel with the six-party talks. These talks are intended to allow the resolution of the North Korean nuclear issue and the advancement of North-South relations to mutually facilitate each other. By taking full consideration of any progress made on the North Korean nuclear issue, the Korean government will manage its relations with North Korea flexibly. However, given a long previous history of existing as a unitary nation, it is, to a certain extent, unavoidable that the Republic of Korea should provide a minimum amount of humanitarian aid to the North in light of its economic depravity and the consequent suffering of its people. For example, North Korea's chronic food shortage is so severe as to stunt the growth and development of its teenagers. As a result, North Korean teenagers are on average 20 centimeters shorter and 10 kilograms lighter than their peers in the South. The fact is, providing humanitarian aid to alleviate the suffering of the North Korean people is an endeavor shared by Korea, the United States, Japan, and other countries in the world. Having said that, I would like to state that Korea's efforts to enhance inter-Korean relations and the humanitarian aid it provides to North Korea remain flexible; flexible under the larger framework of resolving the North Korean nuclear threat and establishing peace on the Korean peninsula. As we have discussed so far, the six-party talks seek a complete solution to an issue that threatens the peace and security of the Korean peninsula, Northeast Asia, and the world. Cooperation between regional players and the joint efforts they make through the six-party talks provide an opportunity to resolve the North Korean nuclear issue and to open a new chapter of reconciliation and collaboration in Northeast Asia. The February 13th agreement opted for a comprehensive approach to resolving the North Korean nuclear issue and to seeking a new, peaceful security order in the region. Moreover, the February 13th agreement also states that directly affected parties would come together to discuss a permanent peace regime on the Korean peninsula through a separate forum. If realized, such a forum would increase the prospects of true peace finally settling on the Korean peninsula after a post-Korean War armistice that is a harbinger for neither peace nor war. This kind of political and diplomatic approach combined with economic aid to North Korea leverages the North to systemize reform and to adopt a more open posture. This is in turn hastens North Korea's transformation as a responsible member of the international community. Such a change for North Korea would represent a significant step forward along the road to establishing peace and order in Northeast Asia, and to advancing the cause of world peace. In this manner, the six-party talks provide a window of opportunity leading to the denuclearization of the Korean peninsula, the establishment of a multilateral security cooperation body in Northeast Asia, and to the settlement of a permanent peace regime between the two Koreas. I hope the parties to the six-party talks and the international community at large will see the denuclearization of the Korean peninsula as a window of opportunity beyond which a future of multilateral security cooperation in Northeast Asia, and a peaceful and cooperative security order in the Asia Pacific region awaits. Thank you very much to Dr John Chipman, His Excellency, Fumio Kyuma, the Minister for Defence for Japan, and His Excellency Kim Jang-Soo, the Minister for Defence for South Korea, Excellencies and ladies and gentlemen. Australia has supported the Shangri-La Dialogue from its outset because we believe that the solutions that we face in security will not ever be addressed without dialogue and understanding which comes particularly from this event. On behalf of Australia, I would like to particularly welcome those additional countries that have chosen to participate this year. We consider that we are at a crossroads internationally in relation to nuclear issues. We worry very deeply about the nuclear enrichment programme in Iran. We worried greatly when we saw the nuclear detonation in North Korea in October last year. However, it is not just the threat and the possibility of regional proliferation, it is also nuclear terrorism, the nuclear relationship between the great powers of the world, and it is also the necessary security implications of the increasing search for and use of nuclear energy as environmental deadlines are bearing down on all of us throughout the world. The International Institute for Strategic Studies' recent publication, 'the Nuclear Black Markets: Pakistan, AQ Khan and the Rise of Proliferation Networks', reminds us of just some of the very real threats that are faced by all of us. Khan's network spread over a number of countries: the Asia-Pacific and the Middle East, spanning three continents, eluding national and international export controls that were designed to prevent illicit trade in nuclear materials. Our fear is a very real one: that others may take up where Khan left off, exploiting vulnerabilities identified by Khan in the global non-proliferation regime. The spread of nuclear weapons, weapons of mass destruction, their precursors and means of delivery is a long-standing security concern for Australia as I am sure it is for all of us here. More states acquiring nuclear weapons obviously increases the chance that those weapons will be used. Australia welcomes the United States' and Russian efforts under the Moscow Treaty to reduce strategic nuclear weapon holdings. The emergence of global insurgency in the form of terrorism has added a new and compelling dimension of chemical, nuclear or biological materials and weapons falling into the hands of non-state actors. Australia supports global non-proliferation and disarmament objectives through practical and cooperative measures. For example, we chair the Australia Group. We have also hosted several proliferation security initiative events. We also recently hosted the Asia-Pacific seminar on combating nuclear terrorism. Effective nuclear non-proliferation regime is essential for Australian uranium export industry, for example. We hold just under 40% of the world's uranium deposits. Also, the continued access to the important nuclear materials in technology is essential. It is so important, amongst other things, for understanding, investigating and treating human diseases. The adherence to international nuclear non-proliferation controls is an essential foundation for trade and cooperation in the peaceful uses of nuclear energy. From our point of view, there are three key nuclear security challenges that face the broader Asia-Pacific region. The first is: preventing further proliferation of nuclear weapons among states. As we know, and have just heard from my Japanese and Republic of Korean counterparts, North Korea detonated a nuclear device last year and is currently subject to United Nation Security Council Resolution 1718, and other measures. We also saw a ballistic missile programme with the attempted Taepodong II launcher in July. Both of these things threaten the peace and security not only of our region but indeed of our world. Iran's nuclear enrichment programme is a major concern. Iran must comply with United Nation Security Council Resolutions 1696, 1737 and 1747; and fully cooperate with the International Atomic Energy Agency. With full transparency and compliance, of course the legitimate pursuit of nuclear energy would not be a concern to us. However, that is far from the case at the moment. The Nuclear Non-Proliferation Treaty is the foundation of nuclear non-proliferation enhanced by the IAEA safeguards and regional treaties, such as the South Pacific Nuclear Free Zone Treaty and the Treaty on South East Asian Nuclear Weapon-Free Zone. Also important are the reinforcing mechanisms, for example the Fissile Material Cut-Off Treaty and the Comprehensive Test Ban Treaty. The second challenge we face in our region, as we see it, is the security of nuclear technology and materials in all states. For example, there are seven nuclear research reactors in our immediate region. All are under International Atomic Energy Agency safeguards. For a variety of reasons, not the least of which is securing energy supplies and dealing with environmental deadlines, countries such as Vietnam and Indonesia are considering the introduction of nuclear power. Amongst all this, there must be a political will to support strong governance procedures that relate to the security of necessary nuclear technology and materials. There must be a collective approach. The global initiative to combat nuclear terrorism and the amended convention of physical protection of nuclear material are just two examples which Australia would commend to all nations. The third challenge is the increased risk of non-state actors accessing WMD materials, equipment and technology. Al Qaeda has expressed an aspiration to acquire and use these materials. In that regard, the Proliferation Security Initiative is essential. After President Bush announced the Proliferation Security Initiatives after the Krakow G8 meeting in 2003, Australia was one of the foundation signatories to it. There are now close to 80 countries that participate or observe the Proliferation Security Initiatives. Australia has participated in 29 of them. It is absolutely essential for all of us to appreciate that it is not about any of us challenging or wanting to change the domestic conventions and laws of countries which choose to be involved in this. It is also not about creating a new bureaucracy or a travelling dinner club or anything that is other than trying to deal with what happens with precursors of WMD once they leave should they leave any of our shores. The IA's study of the AQ Khan network is compelling reading. All of us should consider what would have happened were the BBC China not to have been intercepted. In that regard, Australia strongly recommends participation in the Proliferation Security Initiatives to all nations. In a world facing the challenge of climate change, many nations including our own are looking to either introduce or expand nuclear-generated power. We support the peaceful, legitimate use of nuclear energy within non-proliferation obligations. In that regard, Australia supports enhanced management of the nuclear fuels cycle, as proposed, for example, by the Global Nuclear Energy Partnership launched by the United States in February 2006. A suite of international interlocking treaties, arrangements, undertakings and norms strives to hold the spread of nuclear weapons and technology, and advance the cause of nuclear disarmament, nuclear non-proliferation and other measures. For example, the United Nation Security Council Resolution 1540 commits states to applying effective controls to prohibit terrorists from developing WMD or acquiring their precursors. We obviously strongly support the United Nation Security Council Resolution 1718 in relation to North Korea. In fact, we have amended domestic legislation to ensure that we can fully comply and support the enforcement of that resolution. Similarly, we support the three key United Nation Security Council Resolutions in relation to Iran. We also support multinational approaches and the Proliferation Security Initiative, with of course its statement of interdiction principles and a comprehensive programme of exercises, workshops and outreach. The Global Initiative to combat nuclear terrorism: accounting, control and physical protection of nuclear and radioactive materials, and the suppression of illicit trafficking. We also support cooperation in developing the technology that denies safe havens and sees the prosecution of terrorists. We support the Financial Action Task Force to combat money laundering and terrorist financing. In other words, none of us should ever forget that trying to contain proliferation is not just about interdiction. It is about a comprehensive suite of domestic and international measures which need to be undertaken across military, policing, intelligence, communications, diplomatic and other channels to see that we contain what is a very real threat to all of us and our respective peoples. Nations also need effective export controls, customs, law enforcement and intelligence. We have to stay ahead of the proliferators. We all also need to reach out much more to academia and to industry in relation to identifying those areas where we may be vulnerable, and getting a much better understanding of how the proliferators think and subsequently how they may act. All of us need to accept that proliferation is a political problem. It requires states to act. Much more remains to be done and no one of us in this day and age can afford to take the view that in some way it has nothing to do with us. What each of us can achieve as individual nations alone is absolutely nothing compared to what we can achieve if we work together.
member. 
