It is a great pleasure to stand here in the city that in so many ways symbolises this great country in the eyes of the world and the ties between our two countries.
A great city which has experienced great tragedy.
A great city with the strength, determination and courage to recover from that tragedy.
New York means a lot to Australians - as so many of the Australian diaspora have made their careers here making a great contribution to America, and as a result of that a great contribution to Australia.
In recent years, Australian actors have performed in New York as well has having played famous New Yorkers on the stage and the silver screen.
Hugh Jackman in The Boy from Oz.
Russell Crowe as Jim Braddock in Cinderella Man.
Naomi Watts held in King Kong's paw above the Empire State Building.
There are also some historical ties between New York State, the Revolutionary War and Australian geographical landmarks.
As we know, in the critical events of 1775/1776, the Revolutionary War was a near run thing here in New York as General Washington retreated across the Hudson with the remnants of the Continental Army.
Later in 1777 as the tide of the war turned, at the battle of Saratoga, in upstate New York one Polish-born General named Thaddeus Kosciusko played a crucial role in helping inflict a significant defeat on the British.
Early Polish explorers in Australia named Australia's highest mountain after the self-same Kosciusko - a hero of the Revolutionary War and of course a hero of his native Poland.
I'd like to thank the American Australian Association for hosting my first address on this visit abroad - a visit during which I will be addressing a range of economic and strategic priorities in the United States, Europe and China.
Since its establishment in New York 60 years ago by Sir Keith Murdoch (and I acknowledge the continued support of the AAA by the Murdoch family since then), I understand that the Association has hosted every Australian Prime Minister.
I also understand that its first dinner was in honour of the great Australian Foreign Minister, Dr H.V. Evatt when he was President of the UN General Assembly. A photo of that dinner is on the program booklet for tonight.
That night, “Doc” Evatt, mindful of the high concentration of Wall Street representatives in his audience remarked: “I wonder whether I can be heard above the rustle of securities”. I think I might face the same difficulty tonight!
I am very pleased to follow in “Doc” Evatt's footsteps because, like him, I believe that strong American global leadership and a strong and effective United Nations are critical for global stability.
In fact I met the United Nations Secretary-General this afternoon and I told him that Australia was determined to re-invigorate its engagement with the UN.
I also confirmed with the Secretary-General that Australia will in 2012 be seeking a seat on the UN Security Council for the term 2013-2014.
I am very pleased to have the chance to speak tonight to Australians and friends of Australia.
I want to talk tonight about the critical importance to Australia of a continued close relationship with the United States.
I also want to talk tonight about the priorities of the new Australian Government, particularly how we and our economic partners approach the core challenge of economic management in a difficult global economic environment.
The new Australian Government
The new Australian Labor Government is committed to responsible economic management and is unashamedly pro-market, pro-business and pro-globalisation.
That is our policy orientation because we believe it is in the best interests of the working families who trusted us with the responsibility of government.
We strongly support open trade, open investment and an open economy.
The last Labor Government of the 1980s and the first half of the 90s, under the leadership of Bob Hawke and Paul Keating, opened the Australian economy to the world - deregulating financial services, aviation, telecommunications and other markets, and removing tariff protection.
The Government that I lead stands proudly in that tradition.
We are a reformist, outward-focused and future-oriented government.
The Government's mission is to build a modern Australia capable of meeting the challenges of the 21st century.
For the economy, that means building a globally competitive Australia capable of carving out a future in a highly competitive world.
The Government was elected with a strong commitment to a long-term economic reform agenda, with the overall objective of lifting our productivity growth.
We are implementing a comprehensive program of reforms to our education system, ranging from early childhood services through schools and training, right through to universities and research programs.
The aim of our program is to lift productivity.
Developing our broadband infrastructure is also one of the keys to lifting our productivity. It is a transformational technology. It can help overcome what one of our greatest historians described as the tyranny of distance - both domestically in Australia and in our links with the world.
With the right broadband infrastructure businesses can deliver better services faster to more customers. It can open up new markets and reduce the barriers to establishing a new business. It means that people in New York and Perth can do business in real time - and with sufficient bandwidth.
Broadband is not the only part of our infrastructure we plan to invest in. We need world-class infrastructure across the board to ensure we can make the most of economic opportunities - encouraging nationally consistent public-private partnership regulatory frameworks.
Another element of our productivity agenda is removing the duplication that exists between Australia's national government and the governments of individual states.
Since coming to office in early December, the Government has revived the Council of Australian Governments. We have turned this once fractious body into a mechanism through which Federal and State government leaders can meet and work together on common challenges.
Just before I left Australia, the Commonwealth reached an historic agreement with the States to restructure our $70 billion financial support for them by broadbanding 90 separate grants down to five - each with performance based grants based on measurable outcomes.
A second key element to our economic strategy is lifting the workforce participation rate by increasing incentive.
To do this we will embark on long-term tax and welfare reform to encourage more people into the workforce.
We have already legislated significant tax cuts for this year's budget.
Our long-term plan (subject to economic circumstances) is to flatten the tax structure over the next six years.
Our long-term aim is to reduce the number of personal income tax rates from four to three, with a top rate of 40 per cent.
We recognise that reducing taxes provides an incentive for people to enter and remain in the work force.
As the baby boom generation retires, workforce participation will become more important as a driver of long-term economic growth.
The third element of our strategy is population. With a lower birth rate, we need to do more to help people with young children - making workplace laws more family friendly, improving access to childcare and conducting a proper examination of paid maternity leave.
To complement this, we will also maintain a significant skilled migration program that can respond to skills needs in specific areas.
I believe in a big Australia. That's why immigration tailored to the economic circumstances of the day is important. It also keeps a country young.
Innovation is also critical to enhance our global competitiveness in the industries of the future.
The development of Australia's financial services sector shows that world-class industries can emerge given the right policy settings - and it is worth reflecting for a moment on the global comparative advantages Australia's financial services sector exhibits.
First, the Australian financial sector has one of the soundest regulatory frameworks in the world.
Second, Australia lies in the same time zone as the East Asian hemisphere. Australia has strong institutional (and, increasingly, linguistic) linkages to financial markets across our region given the increasing number of Australian professionals capable of operating in the principal languages of Asia.
Third, the market capitalisation of the Australian Stock Exchange at more than one trillion US dollars is about three times bigger than Singapore and around half that of the Hang Seng.
Fourth, our funds management industry is the fourth-largest in the world with $1.3 trillion under management courtesy of the superannuation policy reforms of the 1990s by the previous Labor Government.
Fifth, the new Australian Government, consistent with its pre-election commitment, has decided to halve the withholding tax on distributions to non-resident investors in Australian managed funds to 15 per cent, making it much more competitive with comparable tax regimes elsewhere.
Finally, just today, following a meeting with the Chairman of the US Securities and Exchanges Commission, we announced our intention to produce an agreement by year's end for mutual recognition between Australian and US securities regulatory regimes to enhance capital flows between the two economies - a global first for both the SEC and its Australian equivalent ASIC.
The future will also see great opportunities emerging in the clean and green energy sector.
As we move to meet the challenge of climate change, innovations that reduce energy consumption and reduce greenhouse gas emissions will be crucial.
Technology like post-combustion capture and storage will be an essential part of the response to climate change.
We can only make the transition to a low carbon economy by developing technological responses to problems.
Other high-tech sectors will be crucial too. In bio-technology and the life sciences we are fostering innovation. Australia has a strong record in the medical sciences and our pharmaceutical exports have been growing strongly in recent years - averaging 20 per cent per year. We have a very strong foundation for the bio-technology sector to grow strongly.
These new economy sectors require a highly-skilled workforce. Supported by new investment by the new Government, Australia's education system is delivering that. It has also evolved into a crucial export sector for the economy.
Last year over 450,000 international students were studying in Australia. Education is our largest services export. It was worth more than 11 billion dollars last year.
My vision for Australia is a modern economy with the best educated, best trained, best skilled workforce in the world.
We will still exploit our comparative advantages in exporting energy, resources and raw materials.
But we also need new industries that can develop on the foundation of a strong skills base, the right infrastructure and the right policy environment.
Our agenda is substantial. Its implementation will require us to call forth all of the energies and talents of the nation.
There's some pretty good Australian talent living and working in this city and I was suggesting to the President that he might cancel a few of your visas so we can get you back in the trenches at home. There's work to be done!
In mid-April the Government is convening a 2020 Summit in Canberra. The objective is to call forth the nation's talents, energies and ideas to address Australia's critical long-term challenges - from the economy, through the creative arts, to Indigenous policy.
Through a non-government committee we are inviting 1000 of our young brightest and best. If you are here in New York please lodge your submission to the Summit.
With such challenges ahead, we cannot afford to waste the talent or potential of any Australian. We are committed to an Australia in which nobody is left behind, nobody is taken for granted. That holds true with special force for our treatment of Indigenous Australians.
On 13 February I presented an apology in parliament to those Indigenous Australians who had been taken from their families in the past. On behalf of the Government and the parliament I said “sorry”.
I thought it was an important step to take - a step towards healing the hurt and a step towards a better future for Indigenous Australians. The apology was part of a new beginning because old approaches were not working and we needed a first step towards closing the gap between Indigenous and non-Indigenous Australians.
An important part of this new beginning is a commitment to closing the health, life-expectancy and education gap between Indigenous and non-Indigenous Australians.
In a modern and prosperous Australia, there should be no reason for these gaps to exist.
My vision for Australia's future is for a prosperous nation, and a nation where that prosperity extends to all Australians - and that, for example, is why I have stated that the Government's first White Paper will be on homelessness.
Our vision is to build a strong, prosperous Australia in which there is still a fair go for all.
Australia and the World
I have spoken about our agenda for the future - our economic and our social agenda.
We also have an active international agenda.
Our engagement with the world is about building on our relationships with partners and international institutions around the world.
It means building on our alliance with the United States.
And it means developing a creative middle power diplomacy to work with our close partners in our region and around the world on challenges like climate change, economic development and countering terrorism.
We believe that this is the rational thing to do in pursuit of our own core economic and security interests.
We also believe it is the right thing to do because Australia can be more of a force for good in the world.
US global leadership
Australia and the United States are historic allies. Our alliance was forged in the days of the Second World War when we acted together to meet the common danger.
Since the Second World War, the United States has provided the strategic ballast to a stable international order.
In the Asia-Pacific region over the past 30 years, the United States has underwritten regional security and allowed the countries of the region to focus on economic development rather than strategic competition. This stability has been a crucial ingredient in the region's remarkable economic growth.
The United States' global and regional role is as important today as it has ever been.
It remains central and fundamental to global stability.
Australia and the United States
My position on the role of the United States in global affairs is clear.
I see the United States as overwhelmingly a force for good in the world.
I am proud that Australia and the United States are partners.
It is a partnership that has been supported by parties of both sides in Australia and the United States.
It is an enduring alliance - as I said at the White House yesterday, our alliance has been supported by 12 US Presidents, both Republican and Democrat; and 13 Australian Prime Ministers, Labor and Liberal.
It is an alliance shaped by our common achievements in the past.
It is also an alliance defined by our common aspirations for the future.
Our partnership is about more than the formal agreements we have signed. It is about shared values. Perhaps that is why we are such natural partners.
During the Second World War, when General Douglas MacArthur was Supreme Commander of Allied Forces in the Pacific, he was based in my hometown of Brisbane.
He was also a regular visitor to The Lodge, where I now live.
In my study, MacArthur and Prime Minister Curtin planned the allied strategy to defend Australia and restore peace to the Pacific.
The strong political and military links that were forged in the dark days of the Second World War are as important to us today as they were then.
The Australia-US relationship is also about our strong economic future.
We have the Free Trade Agreement that provides a framework for ongoing development of our trade.
The United States is the largest foreign investor in Australia.
The United States is the largest destination for Australian outwards investment.
And Australia is the eighth-largest investor in the United States.
The United States is Australia's third-largest trading partner (and what is remarkable about our trade is the prominence of the services sector - accounting for around 43 per cent of our exports).
It is a good story of a growing services trade, and one I am keen to see develop even more.
Global Financial Markets
Just as the services trade ties us together more and more, it gives us common cause in meeting economic challenges.
I don't need to convince this audience of the gravity of the global economic challenges we now face.
The current financial crisis represents, in part, a repricing of risk following the extraordinary global credit growth of the last several years.
During this difficult time, we have shared in US concerns about the best response to the financial crisis.
It has been one of the main topics for discussion during my meetings in Washington.
Australia's financial conditions are different to those of many other countries.
The Australian economy has so far proven to be resilient, despite markedly higher interest rates and the attenuation of our own market for asset-backed securities.
We are not of course immune from events abroad.
As spreads increase, they push up the cost of finance, and lead to higher interest rates for home mortgages everywhere including for Australian families.
The crisis in financial markets is also leading to downward revisions in growth projections for the global economy.
The US economy is expected to slow markedly this year, which will see global growth slow from the strong rates of growth recorded in recent years.
And slower world growth will inevitably affect Australia.
Nonetheless, the Australian economy is relatively well placed:
* Australia has a central bank with robust and enhanced independence.
* We have a strong regulatory framework for Australia's financial markets.
* The Government is committed to a conservative approach to budget policy.
* The Government has zero net public sector debt.
* We have very low domestic exposure to sub-prime mortgage defaults.
* The balance sheets of our principal corporations and banks are strong.
* Resources demand (from China and India as well as long-term partners like Japan and Korea) is holding up strongly and will into the future.
* And the Government is not complacent about the need to push ahead with further, long-term economic reform.
For these reasons I remain an unapologetic optimist about Australia's long-term economic future.
In the face of the challenge of the financial crisis, governments have to choose to hold firm, keep their nerve, and stay the course on policies that will promote stability for the present and continue to reform the economy for the future.
Openness and full engagement with the global economy has given Australia a 17-year period of sustained economic growth.
Australia's engagement with the global economy certainly presents us with challenges, but it also presents us with the responsibility to respond intelligently to those challenges.
The Government's approach involves several elements including the following:
* We will continue to monitor liquidity needs internationally and, through the Reserve Bank of Australia, participate where appropriate in coordinated central bank action.
* Through the Reserve Bank of Australia, we will also continue to monitor and maintain appropriate support for liquidity requirements domestically.
* We will continue to monitor the Australian financial system in light of the current turbulence to ensure that it remains efficient, flexible and competitive - including maintaining competition and choice in the Australian domestic loans market for the benefit of consumers.
* Our response to the global financial crisis must also involve coordinated action with our economic partners. This is a global crisis requiring an integrated global response.
Australia has been a long-standing advocate and driver behind improvements to global standards for the financial sector through the Financial Stability Forum (FSF); the G20 and the IMF.
Through these and other mechanisms, we will work with other economies to improve international risk management systems. This must include:
* Options for stronger international financial supervision;
* Developing improved global standards that will underpin national regimes for transparency, crisis management and stability;
* Strengthening the co-ordinating mechanisms for providing international surveillance of all countries' financial systems and for identifying systemic risks to the global financial markets; and
* Ensuring that national authorities respond effectively when specific risks are identified.
This will require efforts by us and others to work closely with the key international co-ordinating agencies, the IMF, the Basel Committee and the G20 Group on Global Credit Market Disruptions (which Australia chairs), to identify key risks and vulnerabilities and programs of reform.
These matters formed a core part of my discussions yesterday in Washington, including with the Managing Director of the International Monetary Fund, Dr Dominique Strauss-Kahn.
In my first 24 hours in Washington, I was privileged to meet with the President and the Vice President, the National Security Advisor, the Secretaries of State, Defence and the Treasury, as well as the Chairmen of the Federal Reserve and the SEC.
It was a busy day. But it was a rewarding day establishing good working relationships with all key members of the Administration.
Finally, we will redouble efforts to bring the Doha Round of trade negotiations to a conclusion. The successful conclusion of the Doha Trade Round would give the global economy a much needed psychological boost at a time when there is a heightened risk of protectionism. Particularly at a time when the psychology of protectionism may become acute.
I was pleased that President Bush and I saw eye-to-eye on this point.
US leadership will be crucial to getting a result in the Doha Round - as will the attitude of other states in the critical months ahead.
Ladies and gentlemen, when Sir Keith Murdoch addressed the AAA in 1951 he lamented the lack of contact across the Pacific.
Today he would be reassured.
Through the efforts of AAA and countless companies, individuals and organisations, as well as governments of all persuasions in Australia and the United States over the years, our relationship is strong.
And I am confident it will become stronger.
As Prime Minister I am committed to building a relationship based not just on our shared history - but a relationship built equally on our common future into the 21st century.