Michael McCormack (Riverina, National Party, Parliamentary Secretary to the Minister for Finance) Share this | Hansard source

And there should be an outbreak of goodwill on so many aspects of how we govern the nation. It is a shame that the Australian Labor Party does not get on board more often with government policy, because we could take this nation forward in so many ways—including so many ways involving jobs, and the emphasis has certainly been on jobs this week. The Asian Infrastructure Investment Bank Bill 2015 is all about jobs, and I do find myself in agreement with the member for Sydney when she talks about having a vision for the future—not just for the days and weeks and months ahead and not even for the years ahead but, as she said in relation to Chinese politics, for decades ahead. The Asian Infrastructure Investment Bank will do just that. The governance and transparency aspects of the AIIB were very important to make sure that everything was the way it ought to be before Australia got on board. Certainly there were certain aspects that we needed to guarantee ourselves on. We were always going to be a part of the AIIB but you have to make sure there is clarity, that there is transparency, and that governance is absolutely crystal clear before you sign up. There was a process, and we followed that due process—and that is a good thing.

The Asian Infrastructure Investment Bank Bill will enable Australia to become a founding member of the AIIB, which is expected to become operational later this year. The bank will boost economic growth; it will create jobs and promote trade in our region by financing much-needed infrastructure investment. That last sentence talked about jobs and how important they are. It mentioned trade. The China-Australia preferential trade agreement is so important—not just to our two countries but to the entire Pacific region.

This bank will create opportunities for our region and Australia by investing in areas such as transport, energy and water infrastructure, ports, logistics, environmental protection and information and communications technology, as well as agriculture. Mr Deputy Speaker, you know just how important agriculture is to my electorate of the Riverina. ChAFTA is going to open up trade opportunities for the Riverina that we could only dream of not that long ago.

Australia's prosperity and economic growth is tied closely to Asia—the member for Sydney acknowledged that—and a stronger Asian region underpins a stronger Australian economy. It is a win-win for everyone. That is why the Australian government is investing in this bank, having followed due process before signing on: because we are committed to reaching out to all corners of the globe to stimulate economic activity and growth right here at home.

The bill, once enacted, will provide an appropriation for the payment of Australia's financial investment in the Asian Infrastructure Investment Bank. Australia's initial shareholding will be about US$3.7 billion. This includes US$738 million in paid-in capital over five years and US$2.9 billion in callable capital, which is a contingent liability against the Commonwealth. Australia will be the sixth-largest shareholder. Australia's contribution will have zero direct impact on the underlying cash balance, fiscal balance and net debt, as we are purchasing a shareholding in the bank. That is important.

The bill will also authorise the Treasurer to issue promissory notes to the bank to discharge Australia's financial obligations. Again, that is very important. Additionally, this bill will enable regulations to be made to extend necessary privileges and immunities to the bank and its staff, and experts and consultants performing services for the bank.

The bank will initially have US$100 billion of total authorised capital and is expected to start operating by the end of 2015. This US$100 billion will be used to help address the Asia-Pacific region's acute infrastructure needs, which are estimated to reach US$8 trillion this decade. That is a significant sum. Australia will benefit from improved infrastructure throughout the Asian region, which should provide greater opportunities for Australian businesses through increased demand for our services and our exports, amongst which are our agricultural products—for example, Australia's exports will be able to reach new markets and expand existing markets through investment in new ports, roads and railways in member countries.

Additionally, Australian businesses will be able to sell services, including finance, engineering, building and construction and consultancy, to these new markets. Talking of new markets, I congratulate the New South Wales Premier Mike Baird on what he is doing to open up new markets. The New South Wales and federal coalition governments are doing everything we can to make sure that we open up new markets and keep them. Australian companies can also directly benefit by tendering to deliver these projects through the bank's open procurement model.

Another positive feature of the bank is that it will provide this infrastructure by bringing together private sector investment and co-financing projects with other development banks and private sector financiers. As the sixth-largest shareholder of the bank, Australia will be able to influence the bank's decisions and strategic direction. Australia will continue to work with China and other members to establish a bank that is effective, accountable and transparent. We will be asking the bank to complement the work of the World Bank and the Asian Development Bank.

I went to the Asian Development Bank's 48th board of governors meeting in Baku, Azerbaijan from 2 to 5 May this year.

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