Oct 30, 2012

Australia - Australia and the Asian Century

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Oz likely to remain an observer

Everything’s good and getting better in Australia as it takes part in the “Asian Century,” rising ever higher in the global league for incomes, environment, education, etc etc etc. That at any rate is the picture painted by a just-released government vision for where the nation will be by 2025.

The White Paper, titled “Australia in the Asian Century” presents a wonderful picture of Australia’s future under 25 headings but few specific plans of how to get there other than learn more Mandarin or Indonesian. It waxes lyrical about how Australia’s place in “the region” will help it rise to ever higher levels as Asia over takes other regions in economic output. But at no point does it stop to define this “region” or what common denominators exist for it which allow comparison with Europe and North America.

The sub-text suggests that “the region” is mostly just east Asia. The need to learn Asian languages includes mention of several, but all are east Asian except Hindi. No mention of Bengali, Tamil, Turkish, Farsi or Arabic.

There is also an implication that Australia has the advantage of being geographically close to Asia when in reality it is only relatively close to Southeast Asia and the southeast coast of India. Delhi is closer to London than is Sydney.

The report also fondly imagines that its terms of trade will continue to be high thanks partly to this Asian proximity. Given that, despite a recent fall, terms of trade remain close to record historical levels this statement is surely a hostage to fortune. Indeed, while dwelling on Australian current high standards it makes no suggestions as to how the nation is to improve a productivity record which has been abysmal for the past several years.

Impressive gains in GDP have been achieved mainly via the mineral driven terms of trade and by immigration. Nonetheless the glorious vision sees GDP per head rising from 13th in the world today to place in the Top Ten by 2025 and also become one of the Top Ten global innovators.

To ensure all this happens, the prime minister is acquiring an assistant minister to implement the plan, though quite how a wish list becomes a plan is not clear. Indeed one Australian commentator, Alan Kohler in Business Spectator, described the White Paper as “a mile wide and an inch deep”. It also seems to reflect Australian illusions about Asia, assuming both that Australia is accepted by Asians as part of Asia, and that one can make generalizations about Asia’s future simply by extrapolating from recent East Asian experience.

Philip Bowring

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