U.S. Marines to Be Stationed in Australia Under Obama-Gillard Defense Pact

President Barack Obama said the U.S. is sending a “clear message” of its intent to lead in the Asia-Pacific region with an agreement he and Australian Prime Minister Julia Gillard announced to deploy American Marines on Australian bases next year.

Moving to counter China’s regional influence, the defense accord will anchor an American presence in the western Pacific that can help safeguard sea lanes that carry more than $5 trillion of commerce, about $1.2 trillion of it U.S. trade.

“The United States is stepping up its commitment to the entire Asia Pacific,” Obama said at a news conference yesterday with Gillard in the Australian capital of Canberra. “This is a region of huge strategic importance to us.”

Gillard said “building on our alliance through this new initiative is about stability.”

Obama arrived in Canberra yesterday on his first visit to Australia as president, part of a nine-day trip that highlights the shift of U.S. economic and military focus to the Asia- Pacific region as it winds down the wars in Iraq and Afghanistan.

He will address Australia’s Parliament later today before heading to Darwin to speak to U.S. and Australian troops at an air force base. Obama then flies to Bali, Indonesia, to attend a summit of east Asian nations.

Photographer: Mark Graham/Bloomberg

U.S. President Barack Obama shakes hands with Julia Gillard, Australia's prime minister, during a bilateral meeting in Canberra. Close

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Photographer: Mark Graham/Bloomberg

U.S. President Barack Obama shakes hands with Julia Gillard, Australia's prime minister, during a bilateral meeting in Canberra.

The U.S.-Australia agreement was announced as Secretary of State Hillary Clinton pledged in Manila to give the Philippines more military support as the Southeast Asian country presses China to back off claims in disputed waters rich in oil and gas.

Energy Resources

Chinese studies cited by the U.S. Energy Information Agency in 2008 said the South China Sea could hold 213 billion barrels of oil. While the sea borders several countries, China claims “indisputable sovereignty” over most of it.

The Marines will be stationed in Darwin and northern Australia under the agreement. The troops will be deployed on a six-month rotation, starting with 250 personnel and eventually expanding to as many as 2,500, Gillard said. The two nations also agreed to more cooperation between the Royal Australian Air Force and the U.S. Air Force, resulting in more U.S. aircraft passing through northern Australia.

Obama said the increased American presence is not meant to isolate China.

“The notion that we fear China is mistaken,” he said. “The notion that we are looking to exclude China is mistaken.”

Engagement With China

Gillard said both nations are “deeply engaged” with China and want to see the world’s second-largest economy “rise into the global rules-based order.”

China’s foreign ministry said the agreements needed to be studied to assess their benefit for the region.

“To strengthen and enlarge a military alliance -- whether or not this is a kind of appropriate move, whether or not it is in accordance with a region’s or the international community’s common interest -- we feel that’s worth discussing and verifying,” Chinese Foreign Ministry spokesman Liu Weimin told reporters.

Ben Rhodes, Obama’s deputy national security adviser for strategic communications, told reporters that the moves are being made “in response to demand from within the region.”

Rhodes said the South China Sea would be part of a discussion on maritime security at the East Asia Summit in Bali,

Indonesian Foreign Minister Marty Natalegawa said he hoped the agreement wouldn’t “provoke a reaction and counter-reaction precisely to create that vicious cycle of tensions and mistrust.”

“That’s why it’s very important when a decision of this type is taken there is transparency of what the scenarios being envisaged are, and that there is no misunderstanding as a result,” he said.

East Asian Summit

Indonesia will call on the 18-member East Asia Summit to agree to a set of principles that include “renunciation of the use of force,” Natalegawa said.

Clinton said the Obama administration takes no position on the claims of various countries in the area and that any resolution must be peaceful.

While the U.S. move to beef up military relations with Australia has been planned for years, it’s significant that the message was delivered by Obama, said Robert Dujarric, director of the Institute of Contemporary Asian Studies at Temple University’s Tokyo campus.

“What’s important is that it’s being highlighted by the president,” he said. “Doing this with Gillard is a way to tell everyone in Asia ‘look, the U.S. is in town and the U.S. will back you up if you need to be backed up.’”

U.S. Influence

Australian Defense Minister Stephen Smith said in an interview yesterday that there is “no proposal to have United States bases” in Australia. Smith said the rise of China has led some to think “the U.S. is magically disappearing.”

“Well it’s not,” he said. “The U.S. has made it crystal clear that it will continue its presence in the Asia Pacific.”

Obama will be the first U.S. president to visit Darwin, which was attacked by the Japanese during World War II and symbolizes the historic U.S.-Australian alliance.

Australia, which served alongside the U.S. in the Korean, Vietnam, Iraq and Afghanistan wars, is a buyer of American military equipment, approving an initial purchase of 14 Lockheed Martin Corp. (LMT) F-35 Joint Strike Fighter aircraft at an estimated cost of A$3.2 billion.

China’s demand for natural resources, led by iron ore and coal, has made it Australia’s largest trading partner and fueled a record mining boom, much of it concentrated in the north of the country.

“It’s possible for Australia to have an alliance relationship with the U.S. and a comprehensive bilateral relationship with China,” said Smith, a federal lawmaker representing voters in Perth, where he has been the member since 1993. “This is not a zero sum game.”

To contact the reporters on this story: Julianna Goldman in Canberra at jgoldman6@bloomberg.net; Jacob Greber in Canberra at jgreber@bloomberg.net

To contact the editors responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net; Mark Silva at msilva34@bloomberg.net

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