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Hawke-Like in Appearance But Not in Reality

Last week the Business Council of Australia called for it and today Prime Minister Julia Gillard reached out and offered it. Today the Gillard Government wrote to the Business Council of Australia and the Australian Council of Trade Unions offering what at first glance has the appearance of an olive branch to the business community from the Labor Government. The Prime Minister has now sought to give business, the unions and community groups the chance to participate in a national forum, to be named the National Economic Reform Panel.

The proposal from the Prime Minister is an attempt to get business onside, or at least to get them in closer proximity to the unions on a more regular basis than is currently the case. At present, aside from issue-specific working groups and committees, the relationship is limited to largely informal communications between the two interest groups.

The idea of the National Economic Reform Panel is said to be in the spirit of the Hawke Government Accords which saw unions make concessions in order to benefit from other policy changes.

The reality is more than likely going to be quite different. The only likely similarity is the make-up of the panel. They may agree from time-to-time in certain areas but overall, little compromise, except perhaps on taxation, is likely to be achieved.

The idea that the Gillard Government, through this panel, can achieve trade-offs similar to the ones that characterised the agreements which Bob Hawke’s government reached is just fanciful. Prime Minister Hawke’s agreements between business and the union movement were much deeper and broader than any Julia Gillard and her government may achieve, both in theory and practice.

An important part of negotiating is that nothing, within reason, be left off the table from the outset. However, it appears that changes in certain areas of law, specifically industrial relations, will not be on the table from the outset. That’s all fixed according to the government.

Of course, the unions are unlikely to budge on industrial relations in any case, unless it results in significant new power for their side of the bargaining table. But law changes that do not impact negatively on wages and conditions for employees must have a place at the meetings of this tripartite group.

It would appear likely that most of the changes that the panel would find itself agreeing to would just tinker around the edges of existing policy. Some existing rules and regulations and government policy would undoubtedly remain untouched as a result of negotiations between the three parties. So then unilateral government action would be required from time-to-time, defeating the purpose of such a panel.

Instead of being more like the accords under Hawke’s Labor Party, it appears, according to the letter that talks between business, the unions and community groups will have a central focus around how to implement the key recommendations of the Australia in the Asian Century White Paper. To this end, the idea of the panel is, in a way, more issue-specific again than about the broader economic challenges in the future which involves much more than just looking to Asia and thinking about how it is we can best compete in our region, the Asia-Pacific.

While the Asian Century White Paper does allude to domestic decisions that need to be made and implemented to compete with Asia in the Asian region, some of these are quite Asia-specific and we cannot spend too much time as a nation focusing on one geographical area. Other areas of the world that we engage with have a diverse range of needs quite independent to that of the Asia-Pacific and Indo-Pacific regions.

The timing of the announcement and what that implies suggests that the broader intent of the negotiating platform flagged by the Prime Minister has come too late, despite the fact that the BCA boss called for the panel as recently as last week.

The announcement of the reform group comes over two years into the second term of the Rudd-Gillard Government. Many of the key reform decisions have already left the parliament having been made into law. Some of these economic changes have had more business input than others, some with quite limited formal and direct negotiation with peak business bodies and company representatives.

Another certainty is that just about any agreed action in the near future faces the likely prospect of not being implemented. The budget is in a poor position and appears as though it will get worse before it gets better. So, in effect, business, the unions and community groups would be working towards having the government acknowledge aspirations in the near future at least, rather than implementing dramatic actions.

A nice symbol that gives the false impression of cooperation and a willingness to negotiate, but the reality underlying today’s decision is something almost completely different.

Perhaps it would have been better if the call to formal and ongoing discussions from the government had not come after five years of aggression towards certain areas of the business community from the same administration.

The likely outcome of discussions however, would probably be much the same.

Thinking and Educating Like Asia to Compete With Asia

Education was seen as a very important element of the Australia in the Asian Century White Paper launched on Sunday by Prime Minister Julia Gillard at the Lowy Institute. Education standards are set to be pegged to a very challenging and likely impossible goal. This target, already outlined prior to the release of the discussion paper aims to have Australia’s education system in the world’s top five by 2025. This aspiration forms the underlying basis for tackling the “Asian Century” with the most intelligence and vigour Australia can possibly muster.

It is the specifics that matter in this, the Asian Century. A goal to improve our education outcomes dramatically, though near impossible to achieve in under 15 years is a worthy goal to strive for over the mid to long-term.

In a time when Asia already is beginning to dominate the world economically, it is important that the curriculum which guides and drives our places of education adequately responds to the realities of our place in the world. Language is an integral part of competing in an Asian dominated world as is a cultural and educational immersion in different countries in the Asia-Pacific region.

A somewhat dramatic rethink of how we “do” education and mould our young people is a necessary ingredient. This rethink must include early childhood education as well as what are recognised as the more traditional levels of education, primary, secondary and tertiary schooling.

First and foremost we must, if we want to compete in Asia, think like many Asian countries do. We must “Asianise” our education system. Young minds are incredibly malleable and our education system must make early progress in shaping the lives of Australian children.

Even in the early years, when children are traditionally learning things such as sharing, they also need to be learning in a more extensive way how to read and write and begin to perform tasks usually part of the early  primary school years. The shift in how we educate the very young should even extend to teaching languages.

When children reach primary school age they should be well and truly prepared for a complete and focused formal education in the traditional subjects to begin.  The ALP Government have announced that the states will be required to implement a policy where at least one Asian language is taught in every school. This is an eminently reasonable request but only if the commonwealth provide substantial support to implement this.

When it comes to secondary school, the language question is more complex. It would beneficial if Asian language lessons were a compulsory part of all schools throughout the whole senior school experience. Failing that, language should be compulsory in the early years of high school, but a readily available option in senior years.

Tertiary education provides a further opportunity to get Australia’s students “Asia ready”. But tertiary education again presents a complex equation. It is more difficult to begin learning a language later in life than it is to take it up at early age. Policy-makers also need to be wary of impacting too much on the personal choices of our young adults and a one-size fits all approach is far from ideal.

Hopefully, over time, with students beginning to learn second languages at an earlier age there will be an increase among those undertaking tertiary studies who continue with language lessons as a matter of course. If people wish to take up a language at this later stage that should also be supported as not everyone knows exactly what trajectory they want their career to be guided along before they hit universities and colleges.

Particularly for courses like international business and international relations, basic introductory or business-related language lessons must form a part of the university and college experience. Ideally, these should be uniform prerequisites but should not automatically be limited to Asian languages. We still need to continue to pursue expertise in European languages regardless of whether our focus is in Asia or not.

Ideally, courses like education should have a similar focus toward Asian language training as degrees with an international focus. All universities should at least offer as part of their education courses, some of the key Asian languages including Mandarin, Indonesian, Japanese, Hindi and Korean. Again, this must not be to the detriment of important and widely used European languages.

Temporarily, because of the shortfall in Asian literacy, there will have to be some assistance for business but this should not be applied carte blanche.

That’s the language factor, but what of the educational and cultural exchange involving our university students?

The government has announced an intention to adopt, or more accurately steal the Coalition’s idea for a “Reverse Colombo Plan”. The new iteration of the Colombo Plan and more recently, Kevin Rudd’s Australia Awards will not just see Asian students coming to Australia for a period of study, but also lead to Australian students being able to travel to Asian institutions to further their opportunities.

This idea has the potential not just to enhance the language skills of budding young professionals, but also to imbibe greater cr0ss-cultural understanding in the young people of our region.

A big challenge we will face in at least attempting to shift towards a wider interest in Asian languages is attracting enough teachers. This model makes the task incredibly difficult not just because of the funds required to finance it, but because of the scale of the recruitment task needed to make Asian language training pervasive.  Importing teachers with language knowledge is an important short to medium-term goal.

We are already lagging behind in our Asian capabilities and readiness. We must at least try to catch up with the realities of our position. We almost certainly will not achieve all of our objectives.

This way of changing education is replete with grand aims that are unlikely to ever be realised fully. The logistical task and financial requirements are immense. However, even if we fell short, which is certain, we would still be better equipped to take advantage of the opportunities and deal with the challenges of living in a booming region of the world.

Not the Asian Century White Paper

Tomorrow the Prime Minister will launch the Australia in the Asian Century White Paper. This document, which will plot a way forward for Australia in what is already considered to be the “Asian Century”. It will act as the government’s version of a SWOT analysis. The paper will examine the real internal strengths of Australia and external factors that lead that do contribute to our strengths as we continue to engage in the region. The paper will also look at our weaknesses in terms of trade in particular, but also security. The paper will look at the opportunities for Australia in the Asian century, with whom we can engage more to our benefit. Finally, the document will also look at the threats in the region.

In a way, the Asian Century White Paper is behind the times. Trade with Asia already makes up about 70% of Australia’s international trade. This makes it appear clear, as do public statements, that the blueprint is more about the rise of China and to a lesser extent India, than it is about looking at the strengths, weaknesses, opportunities and threats that exist in the Asia-Pacific area. As such, the possibilities of greater relations with the “Asian Tigers” and rapidly growing Asian economies will likely not receive much press.

This examination will look mostly at the bilateral activities Australia undertakes currently, could enhance or could begin to participate in and less at the specific domestic policy directions necessary to cope with living in a strong and prosperous Asia.

Undoubtedly, the Asian White Paper will say that China is the country, above all others to focus our energies on. You would be hard-pressed to find many who would say otherwise. We need China and they need us. Our commodities are prized by China and we source cheap goods from the Asian powerhouse, now the second biggest economy in the world after overtaking struggling Japan. To this end, concluding Free Trade Agreement negotiations with China is an absolute must.

Some will have you believe that China also serves as one of the great uncertainties of the Asian Century.  “Reds under the beds” is not a worry that should be occupying the mind’s of our people. China’s continued growth will almost certainly be one of peaceful empire. Their growth is because of the embrace of market economics and China is communist in name and some aspects of internal behaviour only. The military build-up in China is entirely consistent with the growth of the country as a world power and countries like the United States of America have nothing to fear except for loss of economic dominance. 

In terms of Japan, our second largest trading partner, the future of the economic relationship at least is not as certain. The economy of Japan has been battered by high levels of debt, natural disasters and unstable economic leadership. In saying this though, the relationship with the nation of islands should be maintained with caution and buttressed by increasing economic cooperation with other nations in the region. However, it is in our interests to continue to proceed with free trade negotiations with the Japanese.

Trade relations with South Korea continue to be strong with the nation, as of 2011, being our 3rd biggest export market. We have commenced Free Trade Agreement negotiations with Korea, but the discussions have hit the final hurdle. The agreement was supposed to have been concluded by now, but negotiations are ongoing.

Our next biggest market, is also our second biggest opportunity as the growth of Asian economies explodes. That nation is India. This is a nation with economic growth to rival that of China. While India is not in a position to rival China in terms of the size of her economy, India does provide opportunities. This includes, somewhat contentiously, uranium exports which are now being negotiated and also the restoration of Indian confidence in Australia’s safety for the large overseas student and tourism market the nation of the subcontinent can and has provided. Finalising the Australia-India Comprehensive Economic Agreement is also a necessary step in continuing to open up India to Australia and vice versa.

There are other nations of Asia in the list of our top 10 training partners too. In fact, Asian countries make up more than half of those nations. Also in the top 10 is Taiwan, Singapore and Thailand. With both Singapore and Thailand we have established Free Trade Agreements. However, in the case of Taiwan, there is no economic agreement being negotiated, awaiting approval or in force. Perhaps an opportunity lies there, perhaps we are frightened to pursue one for fear of causing China offense or perhaps our priorities are not mutual.

There are also other Asian states that are outside of the 10 biggest Australian trading partners with which we have already or are in the process of negotiating or approving FTA’s. There is an ASEAN-Australia-New Zealand Free Trade Agreement which includes Brunei, Myanmar, Cambodia, Indonesia, Laos, Malaysia, Singapore, the Philippines, Thailand and Vietnam. This includes nations such as Singapore, Thailand, Indonesia and Malaysia with whom we either have individual FTA’s or are in the process of either negotiating or seeking domestic approval for.

In a broad sense, continuing to pursue the recently commenced negotiations over the Trans-Pacific Partnership Agreement is also a must and will only enhance economic relations with both Asia and other parts of the world.

So in terms of economic cooperation in the Asian region and into the Asian century, the task is not really to establish new markets, but rather to consolidate and build upon those already available to Australia. In the case of the services sector in particular the task is returning it to the vitality we know. Particularly in the case of tourism this will be a lot easier when the price of the dollar lowers and economies recover.

In terms of economic engagement with Asia and the focus that it is given, it is a positive but has the potential to be a negative from time to time. Putting too many eggs in the Asian basket might expose us to regional shocks. So far, with the economic activities we undertake in Asia though, we have managed to avoid major damage to our economy when other countries in the Asia-Pacific have not been spared. But the possibility of exposure to risks should still be in the front of the mind’s of our policy-makers.

New Zealand and the other Pacific Island nations must also factor into the Asian equation. They are as much a part of Asia as we are. New Zealand is our greatest ally in the Asia-Pacific region, a long-term friend and economic partner and we will continue to share and grow our economic relationship and broader bilateral relations with her.

In terms of security, the most volatile place in the Asian region, the place that has the potential to most impact on our security, is Indonesia. Enhancing current cooperation with Indonesia on counter-terrorism efforts is a must. However, this must not be at the expense of combating homegrown terrorism on Australian soil.

It is certain that we will be seen to be deeply connected with the USA . We can, will and should make clear that our actions in the region will be peaceful and aimed at trade and our ongoing security, rather than offensive actions and manoeuvres that constitute a threat.

In terms of China, as stated earlier, it has been quite easy for some to classify the economic growth and consequential militarisation of China as a threat. This eventuality though, as stated before, appears hard to fathom. On the other hand, disputes involving China and her nearer neighbours, currently festering, do have the potential to develop into problems for those nations. By and large, these are conflicts Australia can remain independent of.

With regard to people movements, Indonesia as well as Sri Lanka and Malaysia will remain central to our efforts in cutting down on irregular people movement. We would be foolish to ever imagine that we as a country or even the wider Asian region could solve the complex issue that is asylum seeker movements.

Later on in the Asian century it is also reasonable to keep in mind the potentially significant movement of people in our region brought about by climate change. The scale of this is hard to calculate, but the prospect must be factored into equations. Australia as a rich and prosperous country would be expected to take up the majority of the resettlement burden in such circumstances.

Overwhelmingly the opportunities for Australia in the Asian Century are good. The positives far outweigh the negatives. We must however be careful of too much dependence on the region and too much nation specific interaction within the Asia-Pacific.

We must think, for the century ahead, well beyond commodities and to sources of renewable energy. An ongoing and healthy services sector is also a must as resources begin to diminish.

There is the possibility of regional instability, but much of that should not have consequences for Australia. The major threat will continue to be terrorism with hatred fomented and potential non-state actors trained in Indonesian camps in particular.

We will be seen as one of America’s deputies in the Asia-Pacific, along with South Korea and Japan as well as New Zealand to some extent. In reality though, this should not colour the way we interact in our geographical region nor the way in which our peaceful advances are received.

People movement will continue to be something Australia experiences for as long as there is security and economic concerns in nations around the world. Later in the century this will probably be exacerbated by climate change, particularly in the low-lying areas of the Asia-Pacific.

Australia must not be happy with the status quo. Moving towards greater engagement and cooperation not just in Asia, but the world, is the answer to making the most of the opportunities and the threats that we and the region already experience and may encounter in the future.

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