MATTERS OF PUBLIC INTEREST;Asian Century White Paper – 21 Nov 2012

I rise today in this matters of public interest discussion to speak on the government’s Asian century white paper. We live in an age of great change for the world. Like those looking forward at the beginning of last century, the changes that this century will bring will be profound. And again, like those looking forward at the beginning of last century, we will not know what those changes will be and how they will affect our lives. But there are things that we do know.

In the past 20 years, China and India have almost tripled their share of the global economy. They have increased their absolute economic size almost six times over. This is an extraordinary economic feat. By the end of this decade, Asia is set to overtake the economic output of Europe and North America combined. By 2025, Asia, the world’s most populous region, will account for almost half the world’s output, with the average gross domestic product per person in Asia set to double. Within only a few years, Asia will be not only the world’s largest producer of goods and services but also the largest consumer of them, and it will be home to the majority of the world’s middle class.

With a rising Asian middle class, the demand for services from Australia will increase, and we must take action now to ensure that we have the skills and capacity to provide those services. We cannot delay in developing the skills we need or we will simply be left behind. When the Prime Minister launched the white paper, she said:

Australia has unprecedented opportunities in this Asian century of growth and change.

We’ve already seen the first down-payment in our economy through the demand for our raw materials. It is prudent to get ready for what Asia will demand from us next, what Asians will next want to buy from our nation.

As Asia changes, as it becomes home to the world’s biggest middle class, then it will want to buy the things that Australia has to sell. Whether it’s high quality food, top end tourism, international education, elaborately transformed manufactures, and the list goes on.

In the future, our prosperity lies with a deep and committed engagement with Asia. It is what we need to keep our economy strong—currently the 12th largest in the world according to the International Monetary Fund. To do this, we will need a genuine understanding of those who we will do business with: the peoples, the cultures, the languages, and their approaches to business. We must be diplomatically and commercially engaged across Asia.

The Asian century white paper is the Australian government’s plan to make sure Australia is a winner in the Asian century. As a nation, we face a choice: to drift into our future or to actively shape it. We cannot just rely on luck—our future will be determined by the choices we make.

The Asian century white paper outlines how Australia needs to act in five key policy areas. Australia’s prosperity will come from building on our strengths, reinforcing the foundations of our society and our productive, open and resilient economy at home. That means ongoing reform and investment across the five pillars of productivity—skills and education; innovation; infrastructure; tax reform; and regulatory reform.

As a nation Australia must do even more to build the capabilities that will help Australia succeed. Our greatest responsibility is to invest in our people through education and skills to drive Australia’s productivity performance and ensure that all Australians can participate in and contribute to the Asian century.

Australia’s commercial engagement in the region will be most successful if highly innovative, competitive Australian firms and institutions develop collaborative relationships with others in the region. Australian firms need new business models and new mindsets to operate and connect with Asian markets. The Australian government will work to make the region more open and integrated, encouraging trade, investment and partnerships.

Australia’s future is irrevocably tied to the ongoing prosperity and sustainable security of our diverse region. We have much to offer through cooperation with other nations to support sustainable security in the region. The Australian government will work to build trust and cooperation bilaterally and through existing regional mechanisms. The Australian government will continue to support a greater role for Asian countries in a rules based regional and global order.

Australia needs to strengthen its deep and broad relationships across the region at every level. These links are social and cultural as much as they are political and economic. Improving people-to-people links can unlock large economic and social gains. While the Australian government plays a leading role in strengthening and building relationships with partners in the region through intensive diplomacy across Asia, others across a broad spectrum, including business, unions, community groups and educational and cultural institutions, also play an important role.

The white paper sets out a number of ambitious targets for our country for the years up til 2025 to ensure Australia can fulfil its ambitions and compete effectively within Asia. These include, by 2025, Australia’s GDP per person will be in the world’s top 10, up from 12th, requiring a lift in our productivity. This will mean Australia’s average real national income will be about $73,000 per person compared with about $62,000 in 2012.

By 2025, our school system will be in the top five in the world, and 10 of our universities in the world’s top 100. Globally we will be ranked in the top five countries for ease of doing business, and our innovation system will be in the world’s top 10.

Studies of Asia will be a core part of the Australian school curriculum. All students will have continuous access to a priority Asian language: Mandarin, Hindi, Indonesian and Japanese. I know how important this is personally because my son—whose birthday it is today—studied Japanese at university as one of his majors and is now living and working in Japan because of his ability to speak fluent Japanese.

As an aside, I was pleased to see in a Tasmanian newspaper today, an article about grade 3 and 4 students at the Corpus Christi school in Bellerive who have started learning Indonesian. This program is now underway in four Catholic schools in Tasmania, including via an online course to St Joseph’s Primary school in Queenstown on the west coast. That is another example of how the use of the internet can be used to deliver training to remote areas. The opportunities to deliver training in this matter will only increase with the rollout of the NBN.

The Asian century white paper provides a target for our leaders to become more Asia literate, with one-third of board members of Australia’s top 200 publicly listed companies and Commonwealth bodies having deep experience in and knowledge of Asia. Our economy will be deeply integrated with Asia with our trade links consisting of at least one-third of GDP—up from one-quarter today. Our diplomatic network will have a larger footprint across Asia, supporting stronger, deeper and broader links with Asian nations.

The white paper will set the strategic direction for our policy and funding measures for the whole budget. We are already investing substantial funding across the key action areas outlined in the white paper, including skills, education and infrastructure funding. The National Broadband Network will boost our ability to use our teaching resources effectively, and we will build on new and emerging technology so every child in every school has the opportunity to learn an Asian language.

These objectives will build on the work the Gillard government has already done to increase the understanding and study of Asian languages and culture, including the $62 million National Asian Languages and Studies in Schools Program, and Mandarin is one of the first two languages to be rolled out under the new national curriculum. To help achieve this, every school will engage with at least one school in Asia to support the teaching of a priority Asian language, including through increased use of the NBN.

For Australia to succeed in the Asian century, we need to equip all young Australians with a better understanding of the culture, history and languages of our Asian nations. Greater engagement with Asia will bring greater prosperity for Australia. I am particularly glad to see that the Premier of my home state of Tasmania, Lara Giddings, has already been proactive in trying to engage investors from Asia to invest in Tasmania and find new markets for Tasmanian products and to make the most of the natural advantages that Tasmania has.

Tasmania has enormous opportunities in the upcoming Asian century. Tasmania has world-leading products that the rising Asian middle class want. We have top-quality wines, cheeses, handcrafted timber products, fresh fruits and vegetables, artisan meats and honey, amongst others. We have natural resources that, through appropriate foreign capital investment, we can utilise to benefit all Tasmanians. There is enormous capacity for expansion of our education sector.

Already Tasmania has thousands of students from overseas gaining a tertiary education from the University of Tasmania and our TAFEs. Our proximity to Antarctica makes us a natural place from which to launch scientific exploration of the Southern Ocean, and I am sure that as Asian nations seek to increase their scientific understanding of the world, Hobart will be a perfect base to start their explorations from, working in partnership with Australian research organisations.

The Asian century provides us with unique opportunities. Only by putting in the groundwork now, to invest in education, to gain greater awareness of our Asian neighbours, will we have the opportunity to capitalise on the great economic and social benefits that the coming century will bring.