Beijing, People's Republic of China
[ACKNOWLEDGEMENTS OMITTED]
Today let me pay tribute to the work of the Australian Chamber of Commerce in Beijing - AustCham.
With your wide membership, AustCham plays a critical role in cultivating strong business links between Australia and China.
This is one of the world's most important markets for Australian companies.
Your steps to consolidate the chambers into AustCham Greater China - bringing together the Beijing, Shanghai, Southern China and the new West China chapters - will help you serve your members even better.
I also want to take this opportunity to highlight the work of the Australia China Business Council, established in 1973 and now celebrating your 40th anniversary.
The leadership of the ACBC and the Chinese Investment Promotion Agency, with the support of AustCham, is why this morning's 3rd Australia China Economic and Trade
Co-operation Forum achieved its goal of being one of the leading large-scale bilateral business conversations.
I'm confident this will not only be true of this year's Forum but of those beyond.
The practical, commercial reality of the complementary strengths of the Australian and Chinese economies gives a firm basis to our national ties.
However, our relationship is broader than ever - and we are building diverse people-to-people links.
We have a positive political and diplomatic engagement built on mutual interest and mutual respect.
I am committed to a relationship which goes well beyond the economy.
But the extraordinary growth and success of trade and investment which you have all built is the platform on which Australian leaders stand when we meet Chinese leaders today.
Thank you for all your work.
I have come here this week leading the most senior Australian political delegation ever to visit this country.
These first days of the new leadership here are defining days for the country's coming decade.
So we have come to China with a very clear goal.
To ensure a clear focus on the Australia-China relationship early in the life of China's new leadership.
On Sunday I met President Xi Jinping.
We discussed some of the key issues for the long-term.
How to strengthen the overall strategic direction of the relationship.
How to grow and diversify our trade and investment ties including through a free trade agreement.
How to develop other core elements of our relationship, like our education and people-to-people links.
How to expand co-operation in the region and the world, including in the G20 and the United Nations.
This was a moment to establish the face-to-face contact which is so important to relationships in China - and a moment to set the direction for the new leadership's view of Australia, now and in coming years.
On Monday, I welcomed a very important announcement for financial integration.
The Australian and Chinese currencies will now be directly traded on the Chinese mainland for the first time.
Ours will be only the third major currency directly traded in China's mainland foreign exchange market.
This will make an important contribution to the internationalisation of the Chinese currency, a key policy objective of the Chinese Government.
Australia's banks, superannuation funds and financial houses will now be even better placed to help in the growth of China's service economy.
So part of our task this week is building relationships.
Part is taking advantage of the impetus which a high-level visit creates to deliver some specific practical results.
We have also been building the relationship's long-term future.
The bold step to establish diplomatic relations between Australia and China was taken forty years ago.
Our success has surely exceeded the most ambitious imaginings of anyone present in those dramatic days.
We must actively shape the Australia-China relationship - we can never simply rely on old structures or past success.
Predicting the future is always a risk - but the greater risk is failing to plan for it.
The continuing growth and change in the Australia-China relationship demands new measures to keep it strong.
Leaders on both sides must be confident we have the right structures to guide the decisions we need to make in coming years.
Right now, I don't believe we do.
There is a wealth of senior dialogue and discussion; last year alone, nine Australian ministers visited China.
But the modern relationship has outgrown the mechanisms we have relied on in previous years.
We should address this now in order to shape our relationship's future.
Later today, I'll conclude my visit with a meeting with Premier Li Keqiang.
The Premier and I have previously discussed the idea of a new strategic partnership between our nations - and a lasting new framework for engagement between our leaders.
The long-standing elements of our relationship continue to grow and new elements in our relationship continue to emerge.
Our bilateral contacts are rapidly growing, in scale and complexity.
Even while we manage change between us, our external environment evolves dramatically and this will only continue.
As the Premier has said, our relationship is already “comprehensive, constructive and co-operative”.
It is now ready to take a very “concrete” form.
Naturally, new architecture will not do the work for us or make hard problems in our relationship easy.
What it will do is elevate our existing habits of dialogue and co-operation - and contribute to the trust and co-operation which we need whenever we confront difficult issues together.
New architecture can also provide the forum for leadership and decision-making: giving our leaders the necessary regular opportunity to set new objectives, make new decisions and direct new work.
We should set an ambitious goal: a level and structure of dialogue which Australia shares with only a handful of countries and one which China also shares with only very few nations.
I have no doubt it is an ambition which is justified by the times - and I am delighted that my Chinese counterparts share this view.
I am looking forward to the formal announcement of our plans with Premier Li this afternoon.
Given all this: given the opportunity created by our strong relationship built over decades - and the opportunity we are seeking to create through new structures for dialogue - I want to cast forward now, to outline what I think we can achieve in the relationship in the coming decade.
This is what I see ahead.
First, we must have a far more broadly-based economic relationship with rich people-to-people links.
Indeed the growing breadth in the economic relationship should drive diversity in all the connections between our nations.
We know a rapidly urbanising nation like China finds a welcome friend in a nation like Australia rich in coal and iron ore.
Yet urbanisation isn't just an economic or technological change, it's a vast social transformation: a nation building cities is also a nation living in cities.
So in the decade ahead, I want China to find in Australia a welcome friend rich in the skills and knowledge which underpin civic life: from regulatory and legal standards for urban planning and construction, to health and welfare services, to complex infrastructure like water management and sanitation.
Chinese firms are seeing huge new opportunities in Australia's own strong, growing, diverse economy.
In the past five financial years, the Australian Government has approved $81 billion in proposed Chinese investment in Australian business and real estate.
More than 380 business proposals were approved - all but seven with no conditions at all - and in that time, no Chinese investment has been rejected.
There is clear potential for expanded Chinese investment in Australia and I am confident this will continue to grow.
The plans both nations have to diversify our economies also mean that their complementary nature will not only remain, it will extend into new industries and sectors.
Evolving patterns of consumption and production in both Australia and China show that in the decade to come each of our nations will remain a natural market for many of the things the other is best at making and selling.
Take China's growing demand for the highest food standards and reliable trading relationships. This is one driver of the dramatic increase in Australia's beef trade here.
A similar trend is seen in the barley trade: the majority of Australia's malting barley is traded to China, to a beer market which has grown 30 per cent in volume in five years.
The diversifying relationship between our two economies and the growing connection between our two peoples go hand in hand.
When western Sydneysiders celebrated the Wanderers winning the Premier's plate in A-league football the weekend before last, they were also celebrating the club's qualification for the Asian Football Confederation's Champions League in 2014.
There is every chance the campaign will bring them to China and bring Chinese fans to Parramatta too it's distinctly possible the fans will share some of that Aussie beef and Chinese beer when they do.
This is a key point to understand.
Both nations want our trade and investment links to diversify.
Both nations want our people-to-people links to grow.
Building a more broadly based economic connection and more diverse people-to-people links are in essence one and the same task.
In many respects, the new economic connections and the new social connections are the same transactions understood in different ways.
So the economic relationship will continue to grow and change.
Second, our relationship as a whole can be far stronger and more comprehensive, delivering greater regional and global benefits, in the decade ahead.
Defence co-operation, which is already far broader and more effective than I think is generally understood, will grow.
Only one other country in the world has an annual senior level dialogue with China and ours has been in place for sixteen years.
It's almost three years ago now that our Navies joined in live fire exercises, the first such combined exercises between the PLA-Navy and a Western Navy.
We share interests in aid and development in the Pacific, growing naval co-operation and skills and experience in disaster relief and recovery.
These will be a major asset to the region.
In the coming decade, our co-operation will continue to grow - over time we would like to see this extend to tri-lateral exercises, including with the United States.
Our work together in clean energy will also expand.
Our co-operation in designing emissions trading is already invaluable.
Our trade in gas is of huge long-term significance - this is a clean energy trade which is literally fuelling growth.
Over the coming decade, our co-operation on carbon market design will support national emissions trading schemes in Asia - and progress towards regional carbon trading.
Our links in education, science and training should become a true joint venture in human capital in the coming decade.
The flourishing partnerships between our post-school educational institutions will spread to our school sectors.
All Australian students will have access to at least one priority Asian language including Mandarin.
As part of Australia's National Plan for School Improvement, all our schools will engage with at least one school in Asia, taking advantage of our National Broadband Network.
Australian and Chinese schools will be closer than ever before.
These are all big opportunities for our relationship which we can deliver through steady progress every day.
Ours will remain a relationship characterised by a firm mutual understanding of our distinctive history and traditions, culture and society, political and economic ideas.
Australia's alliance with the United States will continue to contribute to regional stability.
Australia will continue to welcome space for China's growing global role - just as we know China will continue to recognise Australia's enormous stake in strategic stability in Asia.
Our different national conditions will inevitably lead to differences from time to time, including over human rights.
As partners, we engage each other with deep respect.
We will acknowledge our differences and manage them constructively.
We have done this for years.
Four decades of progress lie behind us: they have created a new opportunity for our two nations.
This is what we can achieve in the decade ahead:
Richer links in education and training.
Deeper co-operation on issues like climate change.
A broadly-based economic relationship with growing people-to-people links.
A stronger Australian diplomatic footprint in China.
Closer work together on regional and global challenges.
New structures of political dialogue delivering new levels of confidence.
That's the vision - and we will get it done.
With the same pragmatic outlook - and through the same steady progress - which has worked to develop our relationship since 1972.
I have no doubt that in these years we will seize this opportunity - and build a partnership of real benefit to our own peoples, to the region and the world.