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Breakfast hosted by the National Association of Forest Industries as part of the Liberal Party's Federal Council Meeting, High Court of Australia, Canberra, 3 July 1999: transcript of address [Regional Forest Agreements; impact of globalisation on regional communities; balance between caring for the environment and protecting jobs in regional Australia; Japan/US official visit; Australia as a world financial centre; business taxation reform; Goods and Services legislation; Asian economic downturn]

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3 July 1999








Subjects : Regional Forest Agreements; impact of globalisation on regional communities; balance between caring for the environment and protecting jobs in regional Australia; Japan/US official visit; Australia as a world financial centre; business taxation reform; Goods and Services legislation; Asian economic downturn


Well, thank you very much, Thorry; to Richard Court, the Premier of Western Australia, Kate Carnell, the Chief Minister of the Australian Capital Territory, my many Ministerial and Parliamentary colleagues. And can I also particularly welcome the presence here of my old friend, Sir Robert Cotton, who was the President of the Liberal Party in the New South Wales Division when I joined the Party in the late 1950s. He’s a former senior Federal Minister and, of course, Ambassador to the United States and a member of the Board of the Reserve Bank and a man who has made an enormous contribution to this country.

Thank you very much, Thorry, for your very kind words of welcome. I noted with great interest your endorsement of the Minister. I mean, I now expect when I go to a breakfast and Peter Reith is present some of the leadership of the trade union movement with thank me for him. And if somebody from the National Taxpayers is present, somebody will thank me for Peter Costello well. But, anyway, it’s a mark, I think, of the attempts that Ministers have made to get close to industries that are important to the future of this country that you should say that. And can I start my remarks as well as thanking you most warmly for sponsoring this breakfast.

To repeat, in very unambiguous terms, our strong commitment to your industry that we do believe you can have a sensible balance between caring for the environment and protecting jobs in regional Australia. This idea that somebody’s got to lose and somebody’s got to win is wrong. You can get a win-win outcome. We remain very committed to the Regional Forest Agreement legislation. It will be reintroduced into the Senate - well, it’s in there, it will be listed for debate immediately we go back and we will continue to press very strongly for its passage, and we believe that will occur. And other issues that you’ve raised with me this morning, Mr President, I’ll be very, very happy to pursue.

Yesterday, when I was doing an interview with Neil Mitchell on 3AW in Melbourne, apropos of something that is being debated at the present time I made the observation that over the last couple of years there was probably no political/economic issue that was more heavily debated or more important and relevant to political debate in this country than the impact of globalisation on regional communities. The reality is that we are part of a global economy. We can’t avoid that. We can’t get off it. The die was cast several decades ago and the processes are irreversible. And anybody who runs around Australia saying that somehow or other we can turn the clock back and somehow or other we can avoid the implications of globalisation is deluding themselves and also the people they talk to. But the impact of that globalisation has to be managed. And your industry is a very important part of that because it does provide hope and relief to many people in regional communities. And it’s not much good standing on a truck or a soap box in regional Australia and talking about the glories of globalisation unless you can translate that into jobs and you can translate that into hope and inspiration for the people who live in those communities. So, we’re very conscious of the importance of your industry to that and for the jobs that you provide.

On Monday, ladies and gentlemen, I’ll be going on an official visit to our two, I guess, most important economic partners still and that is Japan and the United States. And during those visits, over a period of two weeks, I’ll have the opportunity of talking naturally to the Japanese Prime Minister, Mr Obuchi and President Clinton, as well as senior people in the American Administration and the Japanese Government. And it is, that visit, very much about moving on to the next step of entrenching Australia’s strong economic position in a world which has grown in its respect for the capacity of this country to successfully manage its domestic economic affairs and to strongly project itself as a significant middle economic power, punching well above its weight not only in the region but also around the world. And one of the things that we must as a country do increasingly is to concentrate on our areas of strength internationally. And one of the areas that I want to concentrate on when I’m away is building the attraction of this country as a world financial centre.

One of the things that’s come through very clearly over the last few years to me is that some of the things for which we were just about to be criticised by the rest of the world and even by some in Australia for being rather too stodgy and too conservativ e are now seen as some of the great strengths that this country has. Because what the Asian economic downturn demonstrated was that countries that had well regulated and transparent banking systems, countries that had sophisticated, well developed corporate laws, countries that had a very stable political system, countries that had a very free and open and tolerant society, they are increasingly the countries that have done well and survived. And those that haven’t have been a lot less successful.

And when you look at Australia now one of the things that make it particularly attractive to the rest of the world, of course it has an unenviable lifestyle and it doesn’t matter virtually where you live, you can pick any one of a number of locations in Australia and it really does have an unenviable lifestyle, but it has a strong, stable political system. It, of course, has a very strong economy but it has a very well developed banking system and it’s prudentially supervised, it’s well regulated and people depend on it and they believe in it. And we don’t have what was witnessed in other parts of the world - we don’t have the banking system being used as a de facto arm of government to look after, in some cases, unfortunately the friends of that government. We have a financial system that is strong and stable and at arms length. We have a strong regulatory and corporate code. And, of course, importantly, as far as the world of commerce and business is concerned, we speak the English language. And I don’t say that in a trite fashion, but it is very important. So when you put all of those things together, this is a very attractive place in which to do business. But that’s not enough. You have to go a bit further. You have to make certain that we have a competitive economy and particularly we have a competitive financial system and we have a competitive taxation system.

And last week we really put the last of those building blocks into place as far as the generality of our taxation system is concerned through the passage of the Goods and Services Tax legislation. And we now go on to the next item of business and that is the item of business taxation reform. And if we do that properly that will be another reason why Australia should be a world financial centre. It’ll be another reason why there can’t be a city in Australia that doesn’t rival and in time surpass Tokyo as being a world financial centre because the time placement of Australia is ideal for it to grow in importance as a world financial centre. And if we make certain that our tax system is competitive, if we make it tax-wise a neutral choice between investing in the United States and investing in this country so that other factors come into play for example, then we have a real prospect of achieving that goal and achieving that dream. And this is the right time to be taking the decisions that will promote our prospects as a world financial centre because we are, to use that jargon, seen by many as the flavour of the month as far as economic performance is concerned. We’ve done better than anybody expected. I guess better than most in this room expected. It certainly surpassed my more optimistic expectations.

And there is a realisation that because we stared down that Asian economic downturn that we have a prospect of really ratcheting up our economic performance just that much more than we ever thought was possible. But we don’t have unlimited time to do that and we won’t be forgiven if we drop the ball on important further reforms and that is why the GST Legislation was so important. Sure it wasn’t everything everybody wanted but it was the great bulk of what everybody wanted and it still represents the greatest single economic reform in a particular area that this country has seen since the end of World War II. And it will have a lasting impact. It will make us more competitive. And if we can make certain in our taxation reforms in the business area we can give ourselves a more competitive tax system internationally. If we can remove some of the imperfections in the capital gains tax area, particularly in relation to impact on venture capital, then we’ll be striking very important further blows towards enhancing this country’s reputation.

There’s only one other thing that I want to say and that is something very directly related to the interface of the Liberal Party with the business community of Australia. There are many people here representing business organisations and representing indi vidual companies. I’m very glad that so many of you have come to this Federal Council. This is the first Federal Council Meeting that has been held in Canberra since we were returned to government in 1996. And it’s very, very nice to be back in the beautiful winter of Canberra for a Federal Council Meeting. I reflect on all those cold, wintry meetings we had when we were in Opposition and they seemed to stretch endlessly into almost political infinity at various times and we’ve now, of course, happily put those years behind us. And we value the links we have with the business community. We’re not owned by the business community. We’re not owned by any section of Australian society. And one of the proudest things I could say on the 2 nd of March 1996 when we claimed victory is that we didn’t represent one section of the Australian community, we sought to represent the entire Australian community. But having said that, we value very much the private enterprise business ethic. It’s very important. We believe in business. We believe in a pro-active investment climate. We believe in the profit motive, it’s honourable. We believe that business is the foundation of jobs growth and employment. And we believe in following policies that attract rather than discourage business investment.

We don’t have the naïve belief of many of our political opponents that wealth will somehow always be there. That you’ll always, somehow or other, be able to find it to fund the various things we want to do in a humane society. So we do regard it as very, very important to have your understanding. We agree most of the time, not all of the time, but on every occasion, on every issue, we’re very happy to listen to what you have to say. We enjoy very much your support and understanding. I thank you most particularly, Thorry, for your association’s sponsorship of this morning’s breakfast. It’s a delight to be with you all and I hope you enjoy the rest of the Council. Thank you.




jy  1999-07-06  11:16