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Ladies and gentlemen,
Thank you for the opportunity to address the Australian Chamber of Commerce in Shanghai.
And thank you on behalf of the Australian Government for the important contribution you make to stronger trading ties between our two nations.
As Minister for Resources and Energy and Minister for Tourism, my job gives me one of the best viewing platforms to see that relationship in action.
More importantly, it gives me and the Australian Government a great opportunity to foster co-operation and trade.
Resources, past and future
Anyone would be forgiven for thinking Australia's economic relationship with China was relatively new.
But in the State of Victoria, home to my constituency, Chinese miners have an important place in our heritage.
The Chinese miners in the Bendigo goldfields of the 19th Century were true pioneers for a multi-billion dollar resources industry.
150 years later, Australia has a great opportunity to support economic development in the Asia Pacific region.
It is my expectation that by 2030, Australia will be:
- The premier energy supplier in the Asia Pacific region
- A world leader in renewable resources development
- And the world's preferred uranium supplier
Current estimates put Australia's uranium reserves as the world's largest and our exports have passed the $1 billion a year mark.
Australian miners are keen to supply uranium to China and BHP Billiton is currently arranging shipments.
More broadly, the growth in global energy demand is insatiable, and Australia is positioning itself to meet that demand.
We have a strong foundation to build on:
- China is already Australia's largest market for minerals, accounting for more than a quarter of our exported minerals resources
- China is Australia's principal export market for iron ore
- We are the world's largest exporter of coal
- Most of China's imported LNG comes from Australia
- And we have a global reputation as a reliable, long-term supplier of energy and resources.
That reputation is the cornerstone of the most exciting development in the trading relationship between Australia and China:
The Gorgon project off the coast of Western Australia is worth a staggering $43 billion, and I'm confident it will not be the last.
One of the contracts that underpins that mega project is ExxonMobil's agreement with PetroChina to supply more than 2 million tonnes of LNG over the next twenty years.
The Australian Government is keen to see Chinese companies enter into more long-term contracts - including LNG from coal seam gas.
Clean Energy
LNG not only bolsters the energy security of our trading partners, it provides a cleaner-burning alternative to coal - and that's important in the transition to a lower-emissions economy.
This week in Shanghai, Australia is playing an active role alongside China in the Asia Pacific Partnership for Clean Development and Climate.
For example, Australia and China are partners in 38 projects worth over $64 million.
By working together on the challenges of energy security and climate change, our efforts will be greater than the sum of the parts.
Australia and China are also engaged in the Joint Coordination Group on Clean Coal Technology, to strengthen our expertise in carbon capture and storage.
Demand for coal has been growing faster than any other energy source, so any credible response to the challenge of climate change needs to accommodate fossil fuels.
Australia prides itself on being a leader in the development of carbon capture and storage:
- We have the most comprehensive CCS regulatory framework in the world
- We have released the world's first CO2 storage acreage for competitive exploration bids
- We are supporting ground-breaking CCS projects in Australia with billions of dollars in funding; and
- We have funded the Global CCS Institute to accelerate the uptake of the technology.
We know it works. The challenge now is to make it work at an industrial scale.
And to make that happen, we look to you - the business community - to help drive investment in China and Australia.
Trade and tourism
Of course, the trading relationship between Australia and China extends beyond resources and energy.
In fact, China is Australia's second largest two-way trading partner for goods and services, a relationship worth more than $70 billion in 2008.
Australians buy more goods from China than any other nation.
Tourism presents as outstanding opportunity for business growth between Australia and China.
Chinese visitors already contribute around $2.5 billion a year to Australia's economy.
The number of visitors to Australia from China is forecast to increase to 379,000 for 2009.
Within ten years, we expect that figure to be more than 900,000 - an average annual rise of 10 per cent.
2009 marks the 10th anniversary of Australia's involvement in the Approved Destination Scheme, and both governments are committed to working together to promote tourism as a driver of economic growth.
The Shanghai World Expo is another great opportunity to strengthen trade and investment.
Up to seven million people are expected to visit the Australian pavilion - a dynamic showcase for a contemporary Australia.
And I know many of you are keen to be part of the biggest world expo ever.
Investment
Australia is an open, transparent and welcoming place, a country built on foreign investment.
That's why the Australian Government is improving the environment for inward investment.
Currently, some screening requirements on foreign investors impose unnecessary compliance costs.
To reduce these disincentives, the Australian Government will replace the four lowest thresholds for private business investment with the highest of these - a single threshold of 15 per cent in a business worth $219 million.
This means private foreign investment below $219 million can proceed without review.
This reform will streamline Australia's foreign investment regime, cut red tape and compliance costs, and improve Australia's competitiveness as a place to invest.
Conclusion
Ladies and gentlemen, the interdependence between China and Australia is good for business, good for growth and good for strengthening our broader relationship.
I applaud the contribution you make to our prosperity, and I invite you to seize the opportunities for future growth.
Thank you