ACBC Chairman’s Column: Win-win as China ups the ante
There is a lot to be gained for Australia as China becomes more vocal about the role it can play funneling investment into the country, writes ACBC Chairman Frank Tudor.
The ACBC’s Australia China Economic and Trade Cooperation Forum has emerged as the type of flagship second track diplomacy initiative that embodies something that I have often written about in this column – the infamous three ‘Ps’, the personal, professional and political links that are so important to the development of our bilateral relationship.
Now attended by two Australian Prime Ministers, four Federal Ministers, the Chinese Vice-President and Vice-Premier and by more than 1000 leading executives over 12 months, attendees have witnessed first-hand the emergence of a sophisticated diplomacy characterized by genuine dialogue spanning a range of sectors and political leaders standing side by side with companies speaking on the great policy challenges facing the future of our relationship.
The Forums have demonstrated that China and Australia share a comprehensive partnership that is moving beyond resources. It is a partnership that transcends simple offtake agreements and one that fuses our competitive advantages to forge win-win outcomes.
Both Prime Minister Gillard and Vice-Premier Li picked up on these themes in their respective keynotes at the most recent Forum in Beijing. Our leaders both spoke of the pressing need to ensure that our economies achieve sustainable growth – a sustainability that delivers certainty, quality GDP numbers and importantly, a greener planet.
Sustainable terms of trade for one thing, would certainly be helped if both governments heeded the Prime Minister’s call for greater work towards the conclusion of an Australia-China Free Trade Agreement. We need to give the FTA more than lip service on the sidelines of major bilateral visits if it is to be taken seriously – as the Prime Minister said, we must do better and we need to do better. The political will seems to exist – we can only hope that in the long hours of negotiations both sides can see the merits of bringing them to an expeditious conclusion.
It has also become apparent that China sees a bigger role in the Australian economy. Vice-Premier Li made pertinent remarks about an emerging role for Chinese companies in areas such as infrastructure, whereby the relationship becomes one less focused on straight forward export earnings, but one where collaboration increases Australia’s international competitiveness and provides China with greater bang for its bucks.
Although Chinese construction and equipment companies have historically focused their overseas presence on developing countries in markets like Africa and South-East Asia, there is no reason why, with the appropriate checks and balances in place, this cannot happen in Australia.
Such a shift would be a welcome contribution to solving the infrastructure bottlenecks which plague our productivity and put pressure on inflation. This contribution would go a long way in spreading the resources investment boom and job creation in rural and regional Australia. The fact of the matter is that many of the developing projects are in areas such as iron ore, coal and gas – all developing on the back of offtake agreements with China, and thus Chinese banks are better placed than most to deliver the risk assessments and inject the capital that these projects sorely need to move forward.
Yet notwithstanding our spectacular terms of trade and the strategic posturing of many, Australia stands at risk of complacency. We cannot afford to ride the terms of trade boom and wine and dine off high commodity prices forever. A new strategic consciousness needs to emerge within the hearts and minds of the Australian people. This consciousness needs to be a fundamental recognition of not only the new geopolitical configuration of our region, but also a new awareness of China.
This consciousness will not emerge when 57 percent of Australians believe that the Australian Government has allowed ‘too much’ Chinese investment into Australia. Recent research commissioned by the Lowy Institute and launched by the Australia China Business Council suggests that this perception has filtered through in market – rightly or wrongly, a whiff of there’s no room at the inn permeates thinking within the upper echelons of Chinese companies.
I suspect that I am preaching to the converted here. Readers of this column know the importance of China to our economy and Australia’s place within the context of a rising China. It is our task to address these public concerns by clearly communicating the benefits of Chinese investment within public discourse. The onus is on us to take the themes of our Forum to our communities and generate the support and the public momentum required to take this relationship to the next level.
ACBC hosts breakfast for Ambassador-Designate Frances Adamson in Perth
ACBC was very pleased to host a special breakfast for the Australian Ambassador-designate to China, Ms Frances Adamson, in Perth in July. A range of companies from a broad cross section of the Western Australian business community attended the event and discussed issues related to Australia’s economic engagement with China with Ms Adamson.
The ACBC congratulates Ms Adamson on her appointment and looks forward to working closely with her over the months and years ahead. ■