Australia will shortly welcome leaders of the world’s major economies to Brisbane for the G20 Summit. The centrepiece of Australia’s agenda as G20 president has been a push to boost collective G20 economic growth by more than 2 per cent above ‘business as usual’ by 2018, which, if achieved, would deliver $2 trillion to global GDP and generate millions of additional jobs. This goal is within reach.
Genuine measures have been put forward by all G20 economies. With over 900 measures on the table, the IMF and OECD estimate that we are now about 90 per cent of the way to meeting our collective ambition. A key theme running through these measures is unleashing the private sector to do what it does best — strengthening growth and generating jobs.
This will improve everyone’s quality of life and is the best source of generating real, sustainable wealth for the world.
As a crucial part of lifting growth, G20 Finance Ministers and Central Bank Governors have agreed a Global Infrastructure Initiative that could help drive quality infrastructure investment right across the G20 and beyond. The Initiative will allow greater knowledge sharing and give us a consolidated database of infrastructure projects to help match potential investors with projects.
And members’ individual national growth strategies include measures to improve the general climate for investment and encourage private-sector participation. This will particularly useful to a country like the UAE which is already Australia’s 13th largest foreign investment partner and is active in looking for additional opportunities. The UAE has been a key player in major infrastructure projects in Australia, ranging from ports in New South Wales and Queensland, to motorways, airlines and hotels.
While recognising that countries’ circumstances will differ, labour and employment ministers have recommended that G20 leaders adopt the goal of reducing the gap in participation rates between men and women in G20 countries by 25 per cent by 2025 as a reference for action. The UAE has achieved significant strides in contributing to the increased participation of women in the workforce, with more than 70 per cent of university graduates being women and numerous women holding senior leadership positions in government and the private sector. Nonetheless, globally there is still much more that can be achieved.
G20 members are also focused on building the resilience of the global economy and ensuring the circumstances that led to the global financial crisis (GFC) are not repeated. Finance ministers and central bank Governors have made substantial progress to strengthen financial institutions and foster global stability. During the September 2014 visit to the UAE by Australia’s G20 Special Representative, Daniel Sloper, it was clear that the UAE Government had implemented a number of reforms to avoid any future impact similar to that of the GFC in 2009. It is encouraging to see the impact of these new regulations filtering through UAE financial and real estate markets.
The IMF has revised its global forecast for 2014 down again, forecasting global growth to average 3.3 per cent in 2014―unchanged from 2013―and to rise to 3.8 per cent in 2015. The IMF April WEO projected that 2014 global growth would be 3.6 per cent and 3.9 per cent in 201], and the WTO’s economists have lowered their forecasts sharply.
It is important to Australia to acknowledge the impact of global growth trends on domestic growth and seek to foster increased trade with our key trading partners. The UAE is Australia’s 13th largest export market, with two-way merchandise trade amounting to $6.2 billion in 2013, a 25 per cent increase year-on-year. A diverse and dynamic global economy can only further benefit this key trading relationship.
The G20 is the right body to steer the global economy back on the path to strong, sustainable and balanced economic growth. With its membership covering over 85 per cent of the world economy its actions reverberate in every corner of the globe. Achieving the G20’s growth target is critical not only for the G20, but also to put the world’s economy firmly back on track after the global financial crisis.
Through the 2 per cent target, we’re striving to create an environment that is conducive to growth, because stronger economic growth is the key to addressing almost every global problem. This means removing impediments to private sector growth, enabling free trade, and lifting participation and employment — particularly of women and young people.
Australia is doing its part. We are repairing the national budget and shifting spending away from short-term consumption and towards growth-enhancing investment, including recycling assets to invest into more productive infrastructure —. We’re lowering the costs of doing business and further opening our trade borders and taking a hard look at competition reform. We are also working with key foreign investors to encourage further investment in key Australian investment sectors, including infrastructure.
Australia is committed to making a real change for the better at the G20 Leaders’ Summit in Brisbane. Any meeting like this is too important an opportunity to let slip by.
We do not seek growth for its own sake, but to help our citizens find new and better jobs, expand business in international markets and to build the infrastructure this century demands.
— The writer is the Australian Ambassador to the UAE.