Aussie PM Cites Institutional Similarities as Strong Incentives for Growth of Bilateral Trade, Investment.
Despite having to be organised at very short notice under the able leadership of Exco member Datuk Wira Syed Jabbar, the 8th Malaysia Australia Joint Business Council held at the Shangri-la Hotel in Kuala Lumpur on November 30, 2006, attracted more than 390 delegates and was an outstanding success.
Keynote speaker at the conference luncheon was Australian Prime Minister, the Hon John Howard, MP, who impressed his audience with his fluency as a speaker -- unaided by notes -- and his warmth. (Following his speech, the PM mingled and chatted freely with members and guests attending the luncheon.)
The following are edited extracts from Mr Howard’s speech:
The Prime Minister of Malaysia and I had a bilateral meeting this morning which extended for a little over an hour ... I remarked to him that the bilateral relationship must be in very good shape because we had spent far more time during our meeting talking about the problems of other countries than we had talking about the problems of our two countries ... he agreed. I think that exchange is a metaphor for the normality restored at senior levels of government...
It has always been a close association. Everybody in this room will know of the extraordinary contribution educational links have made to the bilateral relationship. Taking into account population proportion, there are more graduates per head of Australian universities in Malaysia than in any country in the world. And that is a wonderful legacy of a visionary decision taken decades ago by the then Australian Government to offer educational opportunities.
It has matured ...over the years into a deeply embedded two-way understanding which shares the culture, the hopes and the aspirations of the peoples of the two societies. Our societies have a great deal in common, but we also have significant differences and they are differences that are valuable in today’s perplexing and challenging world.
...In the case of Malaysia and Australia, the things we have in common and the things we don’t are great advantages in living in the world that faces us in the first quarter of the 21st Century. This region, in common with the rest of the world faces the challenge of terrorism and the fact that the two countries bring two of the world’s great faiths to their understanding of each other is, in my judgment, a huge advantage. I mentioned to the Prime Minister that interfaith dialogue between people of the Christian and Muslim tradition should be an important part of the relationship between our two countries, as it is between Australia and Indonesia.
Businessmen and women in this room will all be familiar with some of the institutional familiarity of doing business in each other’s country. The common language of English, the concept of the rule of law, similar rules of corporate governance.
That makes doing business easy compared with doing business in countries where corporate governance systems are very different, or in some cases, almost non-existent. And I know from my discussions with businessmen in Australia how much they appreciate doing business in countries that have a roughly comparable approach to corporate governance.
We are at present negotiating towards a Free Trade Agreement. I don’t pretend that [negotiations will] be finished tomorrow, but we are making good progress. We need an appropriate amount of give and take on both sides, especially in relation to services. Australia sees very strongly the value of a FTA that covers the whole field. FTA’s that have too many carve outs are a contradiction in terms.
We live in a very globalised and very different world ...the value of foreign direct investment in all countries is important. The days when countries could afford to pick and choose foreign investment are gone. Foreign investment will go where it is welcome. Foreign investment will go without hesitation to where it will get a decent return. And any nation hoping to grow and further develop, whether it be Australia, be it Malaysia, cannot afford to pick and choose too much.
Malaysia has enjoyed very strong economic growth over the last few years. It was one of those countries, in my view, unfairly hurt by the economic downturn of 1997 and 1998. It didn’t deserve...to suffer as much as it did. Fortunately, Australia, particularly because of a flexible, floating exchange rate, was able to weather the storm. But in a few short years, Malaysia has staged a significant economic recovery from the negative impact of that event in 1997 and 1998. And as far as our own bilateral trade is concerned, the flows are growing very strongly and something in the order of nine or 10 per cent increase during the last year.
I would say to our Malaysian friends here today that you are dealing with [an Australia] whose economic growth remains very strong. We are now in the 16th year of our longest economic expansion in the last 100 years. There were periods during the 1950s and 1960s when Australia’s economic growth was as fast as it has been over the last few years. But in those days, our economy was a far more inward looking, highly protected beast than it is today. We then had very high tariffs, we had a fixed exchange rate, we had rigid foreign exchange control regulations. We had a highly centralised wage fixation system and we had an arthritic and antiquated taxation system.
Fast forward to today, all of those things have changed. We have a floating exchange rate, we no longer have foreign exchange controls, we’ve carried out major restructuring of our taxation system in 2000, and in two stages we have undertaken a major overhaul of our industrial relations system.
I mention these things ... to project a picture of an economy which is flexible, strong and extremely willing and able to form partnerships with other economies and the companies of other economies in this highly competitive, globalised world.
We live in a region which is fast becoming the beneficiary of probably the most historic shift of resources and human wealth since the industrial revolution. By about the year 2015, the centre of gravity of the world’s middle class will have shifted from Europe and North America to Asia. ... inescapably, Australia and Malaysia are in that part of the world.
Now that carries with it enormous opportunities but it also carries with it a number of risks and a number of warnings...those who open their economies, those that reduce trade barriers, those that see globalisation in an entirely positive light, are economies which are going to be the most successful.... [a] return to protectionism or discrimination in trading activities is not the way to go, [is] doomed to fail and doomed to be disappointed.
...the experience of the world over the last 20 years has been that taking advantage of globalisation, opening up economies and removing trade barriers have done more to lift literally hundreds of millions of people out of poverty than all the individual aid endowments — worthy though they are — of individual countries...if the developed world reduced significantly its trade barriers in the area of agriculture, that would do more to reduce poverty in the least developed countries of the world than a doubling of direct overseas development assistance.
...that is why in the view of Australia, and I know also in the view of Malaysia, achieving success in the current Doha Round of trade negotiations is so fundamentally important. Australia and Malaysia are both members of the Cairns Group of countries, which for 20 years or more have been pushing for a far better world understanding in relation to trade, particularly trade affecting agriculture.
I argue for a success in the Doha Round, and in human terms even more importantly, for what it would mean for the least developed countries of the world. In the next six months ... we have a limited window of opportunity [for]all of the trading groups around our globe [to] put their shoulder to the wheel to try and bring about a successful conclusion of the Doha Round.
I’ve always believed in the fundamental strength of the relationship between our two countries. The strength at a people-to-people level, at a business level, at an educational level, has always been there and I am delighted that at a political level our two countries, although we don’t agree on everything ...are working together in close harmony and close collaboration.
The MABC Events Sub-committee was kept busy throughout 2006 with a heavy program of networking nights which are proving increasingly popular with local members and visiting Australians.