Jim Chalmers (Rankin, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Hansard source

It provides the legislative basis for Australia's membership of the Asian Infrastructure Investment Bank. The member opposite suggests that I sit down now, having made that point. Even if I did sit down now, my speech would be of a higher standard than the one I have just had to listen to! As my friend the member for Mallee leaves the chamber, I remind him that, while it is great that the government now supports the AIIB, they did not support it for a long time, when we did. We were first on the cart for this; they were dragged, kicking and screaming, onto the cart. That is great, and welcome to the party—better late than never—but let us dispense immediately with the absurd notion that those opposite have always been supporters of this great initiative. But we have been. It is a credit to the Leader of the Opposition, it is a credit to the shadow minister for foreign affairs, it is a credit to the shadow Treasurer and it is a credit to our frontbench, who have supported this arrangement since day one. We are proud to have done so, proud to vote for it and proud to speak in favour of it today.

Probably the greatest economic phenomenon of our lifetime is the middle-classing of Asia. Members on both sides have mentioned it. We on this side have always recognised the growing importance of Asia to our economy and our culture—all the way back to Whitlam and his engagement with China, to the way Hawke and Keating opened up our economy and more recently, in the Rudd-Gillard period, to the production of that really high-quality strategic document Australia in the Asian Century. In another role in this place, I was proud to have the opportunity to contribute to that document. It was disappointing, though not entirely surprising, that when the new government came into office they removed that white paper from all the government websites. I thought that was—to be fair—a pretty petulant sort of act. If they had taken the time to go through the thing, they would have seen that there was an opportunity for them. If they had wanted to build on it or update it, great, but it was a pretty petulant act to just delete the Australia in the Asian century white paper and pretend that anything that had been produced by the former government was not worthy of their consideration.

If they had read it and if they had kept it, they would have come across some pretty stunning statistics. For example, in two decades, the Asian middle class more than doubled, from 21 per cent of the global population in 1990 to 56 per cent 20 years later. The OECD estimates that the Asian middle class will make up two-thirds of the global middle class by 2030. In just four years, from 2005 to 2008, the number of people below the poverty line fell from 903 million to 754 million. Just one more statistic: in dollar terms, just 15 per cent of the world's GDP fell within 10,000 kilometres of Australian shores. It has doubled today and is expected to double again to 60 per cent by 2030 with the continuing expansion of China and India in particular. So never before has Asia's regional economy been more important for our own domestic economy's future.

It is self-evident that with this growing middle class and growing wealth comes a growing need for infrastructure, both basic infrastructure and advanced infrastructure, throughout our region. The Asian Development Bank, another institution, has estimated that about 1.8 billion people are not connected to basic sanitation services at the moment; 800 million people do not have electricity; and 600 million do not have access to safe water. It is not only these basic facilities; there is also a need for more roads, railways and telecommunications infrastructure to bolster economic growth so that that growth is self-sustaining and self-perpetuating because it has the right infrastructure foundations. That is so that countries in our region—developing countries in particular but all the countries—can have the productivity growth that they need and the economic growth that they need to provide for their citizens. At the same time, there needs to be investment in the policies, regulations, systems and institutions that enable the infrastructure to be rolled out and used effectively.

All up, the Asian Development Bank has estimated that there is a need for investment in the order of $8 trillion before 2020. It is expected that Asia will make up 60 per cent of total global infrastructure investment over the next decade.

Here is a bit of history and a bit of context when it comes to the Asian Infrastructure Investment Bank, which was proposed by Chinese President Xi Jinping and Premier Li Keqiang in 2013 to address some of these funding shortfalls. The idea of the bank is to promote interconnectivity and economic integration in the region and to cooperate with existing multilateral development banks. The bank will focus on the development of infrastructure in Asia, of course, including energy and power, transportation, telecommunications, water supply, sanitation and urban development. After a year of negotiations, representatives of 57 countries gathered in Beijing on 29 June this year to formally sign the articles of agreement of the bank. Now that that is done, the bank is expected to start with a capital base of US$100 billion. That is considerable when you compare it to the Asian Development Bank, which has around $153 billion in capital, and the World Bank, which has about US$223 billion in capital.

Australia, as honourable members will understand, having read the background to this bill, will contribute about $930 million to the AIIB over five years. That makes us the sixth-biggest capital shareholder, so as a consequence of that we get the sixth-biggest block of voting rights. Ahead of us are only China, India, Russia, Germany and South Korea. I think it is something to be proud of that a country of our size can be the sixth-biggest contributor. I think that it speaks volumes about our capacity to participate in the region that we are prepared to kick in something of that magnitude. It is pleasing to see that we get in return a substantial amount of influence over the institution itself.

A lot of thought has gone into the design of the bank. The three principles are that it be lean, clean and green: lean in the sense that it will only have a small, efficient management team and highly skilled staff; clean in that it will be an ethical organisation with zero tolerance for corruption; and green in that it will be built on a foundation of respect for environmental considerations. On its own, the bank does not have the capacity to bridge Asia's infrastructure funding gap, when you think about some of those enormous numbers I mentioned before, but it really is an important part of the story. It will make a crucial contribution to building infrastructure in our region.

There are huge benefits for Australia. If you want to be transactional about it, there are huge benefits for us from greater investment in Asian infrastructure. We get that seat at the table that I mentioned already when it comes to these important infrastructure investment decisions. It makes us more than just a bystander to the economic development of Asia. It is crucially in our national interest to be part of that conversation. We also get to help shape the bank. We get to build even better connections with our regional partners. And, importantly for our private sector, for our companies, they will get the chance to compete for work in industries all across Asia as a consequence. This could mean huge opportunities—big opportunities for industries like mining and construction and for services sectors in Australia.

It is also very good economic diplomacy for Australia in our region. I agree with the member for Mallee in what he said about Australians understanding how important it is that we engage with the region. If you just take a couple of examples, the Lowy poll is the authoritative poll about Australians' attitudes to the world—I congratulate the team at Lowy for the work they do—and in the 2015 poll, released a couple of months ago, 77 per cent of Australians said that China was more of an economic partner than a military threat. That is a very important consideration. And more and more Australians see greater economic engagement with China as being in our country's interest.

That is why I believe in a high-quality China FTA. That is why I want to see the best possible China FTA. I want to see one that maximises Australian jobs and minimises the risks of exploitation. I will not be lectured by the other members about our relationship with China. Labor is the party of engagement with China and engagement with Asia. That is why we want to see a really good China-Australia Free Trade Agreement. We want to make sure that when it comes to creating Australian jobs we are doing all we can to maximise the opportunities for Australians and minimise the exploitation of Australian workers—after all, the whole point of an FTA is to create Australian jobs. Those opposite who chirp away with their usual talking points, which have probably been leaked out of their cabinet or leaked by someone on that side of the House, can bang on all they like, but I think the Australian people appreciate there is at least one side of the House that wants to maximise Australian jobs out of these agreements and minimise exploitation of Australian workers. There is no bigger believer in free trade in this parliament than me, there is no big believer in engagement with China and Asia than me, and I am proud to say that we do want a China FTA and we want a good one. We want one that does not dud Australian workers.

We welcome the government's support for the Asian Infrastructure Investment Bank—better late than never when it comes to this particular issue. That is why Labor has been so keen to support Australia's engagement with the bank since the idea was first floated. That is why for a month Labor called on the government to join the Asian Infrastructure Investment Bank, and the government engaged in their usual internal fights and cabinet bickering about the issue. Extraordinarily, we had leaks out of the National Security Committee of the cabinet about the arguments over the bank. We had the foreign minister oppose it one day and support it the next. We saw all of this play out in the national media in the usual way and in full view of the rest of the world, which must have confused them when it came to understanding our position on this issue. That delay was costly, as my colleague the member for Fraser was right to point out earlier when he was quoting former ambassador Geoff Raby. He talked about the costly nature of that internal confusion and that internal bickering as other countries jumped the queue on us, got to the table before us and were able to have a greater influence on the process. Infighting is not unheard of on that side of the House; it is a characteristic of this government. This cabinet has largely ceased to function as an effective institution in this country, so it is not surprising that the infighting was costly for Australia.

Government members interjecting—

Mr Deputy Speaker, they can laugh all they want. The only item on the cabinet agenda the other day was a line that said, 'When this cabinet leaks, say that it is performing "exceptionally well".' The only item on the cabinet agenda was a talking point to say that cabinet is working well. Do not tell us that cabinet is working well; actually make the cabinet work well.

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