Asialink shines a light on the links that are shaping our future – 18 July, 2014

Home / Views / Asialink shines a light on the links that are shaping our future – 18 July, 2014

It is a truism today that Australia must integrate its economy with Asia – and particularly China. That’s where the growth is; that’s where opportunities lie.

But I am indebted to Asialink – a body that has been in the forefront of this process for decades – for the latest update on progress, delivered by the Australian Ambassador to China, Frances Adamson. Ms Adamson delivered two presentations, one in Melbourne and one Sydney, each fine tuned to the differing State perspectives.

They paint a pretty encouraging picture. Full texts are on the Asialink website (asialink.unimelb.edu.au) but some highlights included:

• Our bilateral trade with China has now reached a staggering $150 billion a year ($100b of that in exports) – but almost every nation on the planet is now seeking to engage with China so we should not take this for granted. Happily our Governments are not: Days before Ms Adamson’s address, Treasurer Joe Hockey and Trade Minister Andrew Robb met with the chair of China’s Development and Reform Commission, Xu Shaoshi, in the inaugural Strategic Economic Dialogue, a program designed precisely to keep this bilateral relationship growing.

• China is already Victoria’s largest export market for goods. More growth to come.

• Despite the complexities involved, both Australia and China are still committed to reaching a free trade agreement by year’s end.

• These big initiatives are underpinned by a host of more specific education, trade and cultural ties, including an Australia-China agreement on a new Colombo Plan-style education initiative.

• Chinese investment in Australia is growing, totaling more than $109 billion over the past eight years. The $3.9 billion recently pumped into Victorian power and gas distributors SP Ausnet and Jemena may be the biggest single outbound investment ever made by China. A worry? No. Cumulative Chinese investment still accounts for only about 3.3% of the total Foreign Direct Investment here — a fraction of that held by traditional investors UK, USA and Japan. Perspective is everything. Australia and Australian businesses need capital.

Change in China.

Like other observers Ms Adamson was impressed by the sweep of reforms proposed at China’s Third Plenum last year. These cover financial deregulation, reforming the fiscal systems of local and central governments, increased market discipline for State Owned Enterprises, better land rights for farmers and changes to the household registration system.

This is a reform agenda stretching out to 2020 and the Ambassador believes there is genuine commitment. If even half of these reforms are completed China will look a very different place.

And China’s progress is our opportunity.

There is a lot of heat and noise generated by events in Canberra, but it takes a speech by someone like Ambassador Adamson to remind us that the things that will really shape our lives in the coming decades are being addressed in conferences, discussions and trade deals a long way from our parliamentary pantomimes. It is well worth reading.