While the past two decades has seen the decline of some regional organisations, such as the Asia Pacific Economic Cooperation (APEC) forum, others have been reinvigorated. The Association of Southeast Asian Nations (ASEAN) is one example of the latter, as it moves from a primarily political association to an increasingly economic one. At the same time we have seen the spectacular growth of China and the spread of its economic power regionally and globally. It is forming new regional alliances, including the forthcoming China plus ASEAN Free Trade Area (CAFTA). ithin this context Australia has a new leader, Kevin Rudd, who appears to favour engagement with Asia much more than the Liberal government he replaced. This paper examines Australia 's relations with ASEAN and some of the directions the new government is taking with respect to this organisation.