E&OE...........
Thank you very much for those very warm words of welcome and introduction. I would like to especially thank the Deutsche Bank, the Council in Foreign Relations and the German Confederation of Industry for providing me with this opportunity tonight to share some thoughts with you, not only about the bilateral relationship between Australia and Germany, but also in the context of our relations with Europe and the broader world community.
Deutsche Bank of course has had a very long association with my country. Back in the days before we floated our dollar and deregulated our financial system, we from time to time would borrow for balance of payment reasons and Deutsche Bank was a valued advisor and a valued source of assistance, and I'm very reflective of the association that I developed as the Treasurer or read Finance Minister in the German context in a former Coalition Government and I had many dealings with your bank.
But tonight ladies and gentlemen, I want to assert one or two things. The first thing I wish to assert is that the bilateral relationship between our two countries, although it is very strong and the Chancellor and I at our meeting over lunch today agreed that there are essentially no particular problems in the bilateral relationship. It is one that I believe can be made much stronger. And one of the things I have endeavoured to do in my short time in Germany on this occasion is to put forward to my German hosts the view that Australia sees Germany in her own right as a very important and growing interlocutor for Australia in Europe. We seek not to relate to Germany just in the context of Europe, important though that is, but also to draw upon the essential strength of a bilateral relationship that very importantly is underpinned by very close people to people links.
Of all of the non-English speaking countries that have been demographic tributaries to the modern Australia, Germany ranks number three after Italy and Greece, and some 750,000 Australians owe their heritage to Germany. Our identity as an essentially European derived nation, but located in the Asian Pacific region, means of course that we share the culture and the inheritance of western civilisation to which Germany over the centuries has made a massive contribution. Though the importance of the bilateral relationship in its own right and quite separately with the links we have with Europe collectively is something that I have sought to stress in the time that I have been in Germany.
I also want to assert that Australia does occupy in the world a quite unique intersection of history, geography and culture. Australia alone is a country of simultaneously of western European origin with very strong and enduring common values and links with north America, but located in the Asian Pacific region. To underline that point, let me say that 15% of Australians speak a language other than English at home. The largest city in Australia, Sydney, where I was born and have lived most of my life, the foreign language most frequently spoken - that is the language other than English most frequently spoken - are various dialects of Chinese. Melbourne can rightly claim to be the third largest Greek city in the world.
We are therefore in a very real sense a nation that blends those elements of being a projection of western civilisation in the Asian Pacific region and of course our most important defence alliance - it has been for more than 50 years - is our association with the United States of America through the ANZUS Treaty. And we in fact decided as a Government for the first time to invoke the ANZUS Treaty on the 12th of September last year after the terrorist attack on New York and Washington.
I stress that position of Australia to underline not only in a broad strategic sense, but also in a pragmatic economic sense, our value to a nation such as Germany. The fact that we have been enriched particularly in recent years by so many people from the Asian Pacific region does give us a capacity to interact and relate with that region which we believe is of continuing relevance and value to your nation and indeed to many other nations in Europe.
I speak to you today as the Prime Minister of a country that has enjoyed considerable economic strength and development and growth over the last 10 years. Like all countries, we have had our share of luck. People call Australia the lucky country. That's true. We are lucky. We're a country that has not, as far as our own domestic scene is concerned, been touched by war, although we have played our part in the conflicts of the 20th century and continue to play our part alongside the forces of your nation in the war against terrorism in Afghanistan.
We are lucky, but like all successful nations, we have sought to make our own luck. And the story of Australia economically over the past 20 years has been very much the story of a country that has sought to make its own luck and has sought through a process of sustained economic reform and change, to build a stronger economic infrastructure. And there are some encouraging signs that that project has been successful. We did enjoy in the year 2001 the fastest economic growth of any developed country and current projections are in the order of a continuation of that growth at around 3.5 to 4%.
When my Government came to office we had an accumulated Federal Government debt of about 96 billion Australian dollars, and by the completion of this financial year we will have paid off about 61 of that 96 billion and we will have a Federal Government debt to GDP ratio of 4.6% against an OECD average of somewhere in the order of 35 to 40%.
I mention that we have really been embarked upon a 20 year reform process. I can well remember the beginning of 1980 I was Federal Treasurer in the former Coalition Government. And I was invited to give a speech to a gathering of the financial community in Sydney. And I was asked to identify the four or five major economic reform challenges that lay in front of Australia over the year decade to follow. I identified the need for taxation reform, the need for industrial relations reform, the need for tariff reform, the need for financial deregulation and the need to ensure that we achieve Budget surpluses and maintain them. I'm very happy to say that over the last 20 years those reforms have been realised, and I'm also very happy to say that a contribution to realising those reforms has been made by both sides of Australian politics.
Australian politics can be quite partisan. It can be quite willing to be quite colourful. But it is very important that the representation of a nation abroad is a faithful representation of the contributions that all have made to the development of the strength of the modern Australian economy. Two of the five things that I identified were achieved by the former Government, I'm happy to say with our assistance from Opposition. That is the deregulation of the financial system and significant reforms in the area of tariff reductions and industry protection. Reform of the financial system was in fact commenced from the time that we were in Government some 20 years, but really given full force of effect by the former Government. And the same applies with the process of tariff reforms. And over that 20 year period we have succeeded in implementing those reforms.
Since my Government has been in office, and that is from March of 1996, we have undertaken major reforms of our labour market. If I were asked to nominate the most significant economic reform that Australia has had in the last 20 years, I would argue that reform of the labour market would have to be at the top or equal top. We had a very rigid, inflexible industrial relations system six years ago. Although I don't regard the process of freeing it and making it more flexible as having been completed, we have come a very considerable distance, and that has made a very big contribution to the productivity growth of the Australian economy over the last five to ten years. And our productivity growth has been impressive by comparison with other nations.
We have also completed major restructuring of our taxation system through the introduction of a broadly based Goods and Services Tax. It is now just over two years since that was introduced and despite the predictions of doom and despondency and despair and the end of civilisation as we know it, which were the warnings of those who opposed those changes, I'm very happy to report that that has been successfully introduced. It carries with it a company tax rate of 30% which is a reduction of 36% and also the elimination of a wide range of state taxes which impacted heavily on the business community, particularly the small business community.
I have also of course indicated to you in the earlier part of my remarks the progress that the Government has made towards taking the Government Budget out of deficit and placing it in surplus. So the economic story is very much a story of a 20 year process of reform. Economic reform is always difficult. I don't pretend for a moment that Australia is the only country that has achieved economic reform. Different countries have had different experiences with it. My own experience tells me that economic reform is, even of a radical kind, is achievable with two essential preconditions I addressed. And I speak as a practising politician as well as an economic reformer. And those preconditions are firstly the aggregate national benefit has to be identified. In my country's terms, you can't sell a reform unless you believe and you can persuade the public that it is good for Australia. And the second precondition is that the elements of the reform not only must be good for the country in question, but the elements of the reform must have a fair and even impact on all the citizens of the country. And if in the process of introducing a reform, you are asking one section of the community to carry a disproportionate share of the burden of that reform, then that reform is not going to be realised.
I've spoken thus far of some of the changes that we made in Australia and some of the changes that have enabled us to strengthen our economy. We drew great satisfaction as a nation from the fact that the Asian economic downturn did not engulf Australia in 1997 and 1998. And we were pleased that because of the economic reforms that have been undertaken, we were able to shift many of our exports which otherwise would have been lost to us because of disappearing markets in parts of the Asian region, with those exports to both Europe and to North America. And it was a timely reminder to all Australians that we are very much an economic citizen of the world and not a country that should only see her economic and trade future in our immediate region.
And that of course brings me to an issue that you would expect me to unapologetically canvass and that is the importance of European union of Germany, of the United States indeed of all developed countries in addressing the challenge of trade reform in the context of the next world trade organisation negotiation, the so-called Doha round.
I think it is fair to say that the cause of trade reform does appear to be lacking enthusiastic supporters and enthusiastic participants. As a very close and good friend of the United States, Australia was very disappointed with the passage of the American farm bill. We of course remain in a continuous state of disappointment about the operation of the common agricultural policy. We assert that criticism and that sense of disappointment not so much in any plaintive sense in our own interest - although they are very strong, and I'll come to those in a moment - but more in the broader context of the contribution that trade reform of a thorough going nature could make to the cause of assisting the developing countries of the world. Impressively the G8 countries have offered greater assistance to the very poor countries of Africa which proposes to link economic assistance to governance improvements, and I talked to your Chancellor about it today, and it does represent an impressive and generous contribution of the developed countries of the world to Africa. But might I gently remind you that by a factor of three or four the removal of trade barriers would do far more to assist the developing countries than all of the foreign aid that is now provided to them by the developed world, so the cause of trade reform is not something that an Australian Prime Minister takes up only in the interests of his own country. But in the broader context of the contribution that it can make through the developing nations of the world, but of course there is a legitimate Australian argument and a legitimate Australian interest the subsidy value of support to agriculture from the European Union is thirty-five percent of total production, it's 21 percent of total United States production from United States tax payers, the comparable figure in Australia is four percent. We do have efficient farmers, they do feel legitimately aggrieved to current trading arrangements and it will remain a very active part of Australian trade advocacy around the world to bring about in the context of the World Trade Organisation round that reform, I acknowledge over a period of time of existing arrangements. I do believe that if we don't make a start as developed countries down the track of reform in this current round, particularly in the developing world, emerge a sense of greater frustration and great despair. It is as much in that context as in the context of a legitimate Australian national interest that I would argue the cause that reform.
No audience in a democratic nation that needs to be reminded today of the enormous importance of the fight against terrorism and Australia and Germany are joined together in that cause. I've just come from a very brief but moving ceremony at the Airlift Memorial and I reminded myself that somebody of my age that was one of the very first international events that I followed as a young child. The symbolism of that partnership then between former enemy countries in the pursuit of freedom was certainly not lost on me and it has it's contemporary resonance in what is now occurring in the partnership between Australia and the United States, and many other European nations and Australia in Afghanistan. That struggle will not be easily won and none of us know how long it will continue. But Australia as I know is Germany is a very strong and committed partner with the United States in that cause.
Ladies and gentlemen the final thing that I want to say to you is to return to the theme of my opening remarks. And that is that I see my visit here to Germany as not part of a European visit although it is literally part of a European visit. You don't come all that distance from Australia just to visit one country at a time. It makes a great deal of sense in so many ways to do a number on each visit. But the stand alone bi-lateral relationship between our two countries is very important and it can be made much stronger. It's built on a lot of things that we have in common and a lot of things we complement each other on. German tourists are growing in their contribution to the exchequers of the Australian Tourist industry. The growth in the backpacker industry in Australia which brings so many young Europeans from Germany, from Britain, from Ireland and from so many other nations is making a very important and vibrant contribution to the modern Australia. But was said at the very beginning of this gathering we do have a lot of values in common and those values of course are first and foremost our commitment to liberal democratic systems of government. Our respect for the rule of law. And in a broad sense our commitment to open and freer markets and what I might loosely describe as competitive and I hope ethical and compassionate capitalism. Because the keys to national wealth remain in my view a vibrant competitive capitalist system. And without a commitment to such a system based on ethical principles and practice the kind of societies that I believe both of our nations aspire to are not going to be achieved.
Can I thank you for giving me this special opportunity of sharing some thoughts with you. The sponsors of this gathering tonight bring together the great economic and financial experience and strength of the German nation but also its contribution to world affairs. I admire what Germany has achieved in recent decades. I salute her contribution to Europe but also in her own right separately from her association with Europe her contribution to the cause of freedom around the world.
Thank you.
QUESTION:
Somebody has to make the start-off. Prime Minister, to identify myself until '99 I used to be in Brussels as German permanent representative to the EU and in '96 - 7 your Foreign Minister Downer came with great enthusiasm to Brussels and we negotiated a framework agreement political strategic declaration on the cooperation between Australia and the European Union. Now I don't blame you that you didn't mention this historic declaration which we worked out today. Nevertheless may I kindly ask you to comment if this declaration still of value for Australia/European relations not only in the economic field, but also on strategic matters.
PRIME MINISTER:
You ask me whether this framework agreement is still in place that is my understanding, very much so. It is very much so. And it's like so many of those international agreements it appears to say very nice things about everything but does symbolise an attitude of mind. And there are so many things on which Australia and the European Union agree. But it is important to have a framework agreement of that kind. We have some disagreements but the agreements far out way, but it is certainly still in place and the Minister you mention Alexander Downer is still in place too. And he is doing an excellent job and he did bring great enthusiasm to that I remember it very well. And we had some vigorous discussions about the human rights part of it. But it all worked out well and everybody is very happy with it.
QUESTION:
My name is Nicholas Langer from the ANB Australian, New Zealand, German Business Association in Hamburg. Prime Minister you mentioned the many similarities and connections between our two countries. Let me say we have one more thing in common also - that is a refugee problem and I would be interested if you could give me an update on the refugee problem in Australia and the situation in Nauru and Papua New Guinea and Woomera. Thank you.
PRIME MINISTER:
Yes I would be very happy to. Australia has for a long time had a non-discriminatory immigration policy. We will take somewhere in the order of 105 - 110 - 115,000 migrants in the next year. Extrapolating into the German context that is about 450,000 given the population difference. And in addition to that we have a off-shore humanitarian refugee programme of 12,000 a year. Now that is the legal immigration . In addition of course we have the problem of illegal asylum seeking. Australia is different from most nations in that we are an island continent and therefore the challenges are different than they are for nations such as Germany. We take the view that any country has the right to decide who will become its citizens and who will live there. We have taken a firm line in relation to illegal immigration and the measures that we took last year have resulted in no further illegal arrivals for a period of six or seven months and we have over that period of time in cooperation with the United Nations and the International Organisation of Migration processed people. Some in Nauru, some in Papua New Guinea. Previous arrivals have been held in detention in Australia. It is fair to say that the great majority of those who have been judged not to be legally entitled to refugee status, the return of those people is not easy. We have commitments under the 1951 Convention against any refrailment of people who are fleeing oppressive regimes and we will continue as a signatory to that Convention to fully respect our obligations in relation to that. We are hopeful of encouraging the return of quite a number of refugees, asylum seekers rather, from Afghanistan. We are providing financial assistance to enable their resettlement.
We don't like the policy of mandatory detention but we have made the judgment, and in fact it has been over a ten year period a bipartisan policy in Australia. Mandatory detention was in fact introduced by the former Labor government some ten years ago with our support in Opposition. And we don't like it but we take the view that there really no alternative that in the words of the NSW Labor Premier, if you don't have a policy of mandatory detention then the illegal arrivals will simply melt into the community. I should of course emphasise that my country has taken people from 140 different nations. I mentioned in my introductory remarks that 15% of Australians speak a language other than English at home. Ours is a non-discriminatory policy. We did have a White Australia policy up until the 1960s which generally meant that people other than of European origin weren't accepted as migrants. That all changed forty years ago and I stress of course that we have the situation where so many people living in Sydney now especially are of Chinese background. But the contributions to our community are not just from China but from all the other nations of Asia as well.
We think it is the right policy. It's attracted attention. We don't seek to
upon other nations what other countries do is a matter for them. We think it is right for Australia and we are not in any way reluctant to defend it anywhere.
QUESTION:
I am a student of political science here at the University of Berlin. My question goes a bit in the same direction. Today underlined the values which Australia shares with Europe and the United States and the western values fill the very basis of the Geneva Convention for the Protection of Refugees and other human rights bodies. So my question is : how can the Australian government assume policy which locks innocent people and children up in detention camps when the only crime they have committed was to ask Australia for protection. How do these values go together with the deployment of Australian Special Forces against leaky fishing vessels carrying desperate people. Where are the western values when Australia denies potential asylum seekers the right to seek protection from persecution by exorcising parts of the Australian territory from the migration zone? Thank you.
PRIME MINISTER:
Well I would say to that, I've heard that criticism before. It's been voiced by some of the Government's critics in Australia. There is nothing we are doing that is in conflict with our obligations under international conventions. We in fact in the action we've taken to deter illegal immigration to Australia, the action we have taken has been humanitarian and consistent with our obligations and the men and women of the Australian Naval Forces in particular that have been involved in those actions have often put their own lives at risk in order to save the lives of many of the people who have sought to come to Australia.
It is not an easy issue and it's fairly simplistic to mouth an emotional criticism of what we are doing. I do ask those who criticise it, and I think the questioner is fairly critical of what my Government is doing, I do ask them to bear in mind that every time an illegal arrival comes to any country which has a humanitarian off-shore refugee programme, then a place that might otherwise have been available to somebody who might be judged by international organisations as being more deserving of that place is lost. We have a programme where we say we will take several, some 12,000 refugees a year. If those places are filled willy-nilly in an ad hoc fashion by people who come illegally then our capacity through that off-shore refugee programme to provide assistance to people who are judged by international organisations as having a more meritorious claim is diminished. And any one who has visited refugee camps around the world including refugee camps in various parts of south-east Asia will realise that people living in those are living in particularly desperate circumstances. And if you are talking about what is humanitarian and what is ethical and what is moral I would have thought that when is comes to refugees, maintaining an international protocol and regime which allows organisations such as the High Commission for Refugees and the International Organisation and Migration to decide who has the superior claims to refugee status amongst those countries that are willing to offer humanitarian places, that those organisations are better able to make the judgement. People smuggling and illegal immigration challenges the whole basis of that. And that is one of the many reasons why Australia has taken the stance that she has.
QUESTION:
The Director of STEP-IN, Student Travel Education Programs International. When Australia and Germany signed the working holiday agreement and we are one of the facilitators in Germany to assist and advise young people to go to Australia. Australian Tourist Commission says that last year about 3,000 visas were applied from young Germans. This year it is probably 6,000. New year it will be 10,000. Unfortunately, young Australians are not coming to Germany at this stage in those numbers. Of course we like to encourage them as it is a mutual agreement on mutual ideas, on mutual visa numbers. Do you see that there will be a cap in the near future for young Germans to earn a working holiday visa to Australia, a ceiling.
PRIME MINISTER:
No. I wouldn't have thought so. I think over time there will be a reciprocity but I can't see why there would be any reason why there would be any cap placed on that. I think these working visa arrangements are excellent and I recently had a meeting with the Prime Minister of Thailand, visited Australia and we've agreed to commence a dialogue about possibly introducing such an arrangement with the young people of Thailand and Australia. We are very keen to encourage those arrangements with as many countries as possible because the experiences you learn in a nation other than your own where you may either work or be educated is an experience that you keep with you for the rest of your life. And I have to say that as I go around the world whenever you come across people who work for a lengthy period of time in Australia or been educated in Australian universities it is something they remember and remember with very great affection. So I would hope that over time the number coming from Australia to Germany will rise but I certainly am not aware of any reason why we would seek to place a limit. And in fact we would encourage as many young Germans as possible to take advantage of the scheme.
[ends]