Today is an opportunity to exchange ideas, drive innovation and explore new trade opportunities. We want business to be in the best position to take advantage of the new global gateway created by Australia's new export agreements.
A global gateway that is right on our doorstep.
A thriving business sector
We've always been a nation bursting with ideas.
Our businesses are known to be very innovative.
It is a reputation built by a nation that embraces aspiration and opportunity. To work harder, to do better - this is at the heart of who we are.
To me, there is nowhere more obvious than in our thriving small business sector.
There are more than two million small businesses right across Australia. Employing more than 4.7 million Australians. Collectively, they contribute about $340 billion to our economy.
Small business really is at the heart of our community, and this Government is committed to creating more opportunity for small business to grow and create more jobs.
And that is what I'll be talking about today - the enormous opportunities for business and industry to thrive, particularly via the new global gateway Australia is helping to create.
A new global gateway
It is of course a gateway that Australia hasn't always pursued.
In his first speech as Prime Minister, Robert Menzies said: "What Great Britain calls the Far East is to us the near north."[1]
It was April 1939.
Shortly afterwards Australia, as part of Britain's empire, would be at war in the Pacific.
More than 75 years later, much has changed.
Australia is no longer a remote outpost. We celebrate our multiculturalism with pride. Our northern neighbours are our trusted friends and trading partners.
The region is, indeed, the new global gateway.
Let me give you an example. In 1972 China made up about 1 per cent of Australia's total trade. Today, it's 30 times that.
And these relationships are only getting stronger. In the case of China, we expect total trade to increase from 30 to 40 per cent in 10 years.
This is because Asia's middle-class is growing. Already China, Korea and Japan present a customer base of 1.5 billion people - and Australian skills, services and products are growing in demand.
In the coming decades, our Asian trading partners will look more to Australia for all kinds of goods and services: from health and education, to our mining products and fresh food, to travel and financial services.
And given that services represent 70 per cent of our economy, and a growing share of our exports, great opportunities beckon.[2]
Opportunities in Asia
For these reasons, our new export agreements with China, Korea and Japan - as well as the unprecedented Trans-Pacific Partnership - could come at no better time.
Each agreement is a great deal for Australia - particularly small and medium enterprises.
Let me paint a picture of some of what we will be seeing under these deals.
For our all-important services industry, there will be opportunities to expand into Asia, free of barriers.
In the China Free Trade Agreement, or ChaFTA, Australia is receiving the best services commitments it ever has in an FTA, giving new and significantly improved market access for key services.
China has also extended Most-Favoured Nation treatment to Australia. This means that when China enters into trade agreements with other nations they will extend to Australia the beneficial treatments that are provided to those other trading partners for many of our service sectors.
In the coming years, Australian companies in China will be able to expand their businesses, for example opening and running hospitals, aged-care facilities and restaurants to name just a few.
The opportunities for Australia's aged care providers, for example, are enormous. These include training and education programs in HR, home care services, senior living apartments and units, design and planning for aged care facilities as well as infrastructure investment and operation.
China has now more than 194 million people over the age of 60. This figure will increase significantly in years to come. The economic benefits to Australia are clear.
In fact, my colleague Sussan Ley, the Minister for Health, is in China this week and has just signed an MOU with the Chinese Government and met with a number of Australian aged care providers undertaking commercial relationships in China.
Australian private higher education providers will also enjoy access to China's education market. And it will be a similar story for a law firm that wants to dip its toes into the Japanese market, or an accountant looking towards Korea.
But it isn't just the services industry that benefits. Australia's primary industries will see tariffs reduced dramatically - or, in many cases, abolished.
For a cattle farmer in Victoria, for instance, their beef will enter China duty-free in the next few years, axing tariffs ranging from 12 to 25 per cent.
When you consider that the industry exported 128,000 tonnes of beef to China - worth $655 million - this is a huge win for the industry.
Then there is our fishing industry, working from coast-to-coast to collect prawns, oysters, crabs and other seafood: they will see an immediate elimination of the 10 per cent tariff for goods headed to Japan.
Finally, for our fruit and veggie farmers many products will enter Korea duty-free, whereas before the tariffs were as high as 24 per cent.
These are, of course, only a few examples and there are many, many more.
Across the board, we will experience a huge boost to our export competitiveness, benefitting Australian business, industry and the broader economy, for decades to come. And, of course, there will be jobs. By next year, we expect the North Asia FTAs alone will create thousands of jobs, and continue to grow over the next five years.
The Government's focus now is to make sure that local businesses have the best possible domestic policy settings to encourage them to expand their business and take advantage of these new export opportunities. This includes more red-tape relief and a taxation system that helps the international competiveness of Australian businesses.
Our migrant success story
Our ability to take advantage of new trade opportunities is uniquely enhanced by our diverse, well-educated and multicultural workforce.
The 2011 Census revealed that over a quarter of Australia's population was born overseas and a further one fifth had at least one overseas-born parent.
While historically, the majority of migration came from Europe, there are increasingly more Australians who were born in Asia and other parts of the world.
Our history speaks for itself. Australia was built by migrants.
It comes as little surprise that, in every decade following 1950, Australia has welcomed one million migrants.
Today, we continue that proud tradition. We have a structured and robust program that promotes stability and confidence, and provides us with the knowledge and skills we need to succeed.
In 2015–16, Australia will offer 190,000 permanent migration places - almost 70 per cent of which are for skilled migrants.
This reflects our confidence that new migrants will be able to achieve economic independence and help Australia's economy grow.
This is well documented by the fact that Australians who were born overseas are more likely to be self-employed than those born here. The most recent economic figures tell us that 31 per cent of business operators and independent contractors were born overseas - or about 613,000 people.
This is indeed a huge number - one that is expected to grow further - and indicates how migrants are prepared to take risks and are particularly well-suited to the world of enterprise.
These Australians know the markets into which we seek to expand; they understand the demands of the populations we look to serve. Importantly, they have the language skills, cultural understanding and people to people networks, necessary to engage with businesses overseas.
Australia's productivity diversity is crucial in promoting trust and goodwill, as well as seizing new opportunities.
International competitiveness and innovation
Now, in the time remaining I would like to talk about what the Turnbull Government is doing to boost international competitiveness and innovation.
We want Australia to be a more attractive place to do business and a more attractive place for people to invest.
Of course, our $5.5 billion Growing Jobs and Small Business package in this year's Budget lowered tax rates for all small businesses, with a 1.5 percentage point cut to the company tax rate for small companies and a 5 per cent tax discount for unincorporated entities.
We've also reduced the burden on businesses, announcing more than $2 billion in red tape savings and removing almost 450,000 small businesses from the Pay-As-You-Go system.
This means owners have more time - and money - to focus on the tasks that really matter, and look towards new and growing markets.
The Government also has more on the horizon for how we can improve Australia's competitiveness.
Getting the tax mix right will be critical. This means a serious look at both federal and state taxes. We need to have a tax system that will unlock growth – not stifles it.
We need to lower taxes overall and we need to be competitive globally – given how interconnected our economies are today.
But increased taxation competitiveness will only go so far; we also need to team it with innovative ideas if we are to further strengthen our businesses and industries.
As a Government, we are committed to innovation.
We believe in its power to transform our economy, and we are determined to reduce regulatory barriers that prevent innovative ideas from becoming reality.
A case in point: we are making it easier for business to access finance.
The Government is developing legislation to remove obstacles to crowd-sourced equity funding: a new way to raise funds for early stage businesses, and a way for ‘mum and dad' investors to share the risks and triumphs of the business.
And in the Government's recent response to the Financial System Inquiry, we announced a package of measures to support financial sector innovation: things like digital technology, contactless payments and the increased use of data such as credit scores.
These measures have the potential to be transformative by getting rid of the barriers to efficiency and to bring forward product innovation.
The Government is also committed to cutting red tape for employers by simplifying the tax and superannuation obligations through the Single Touch Payroll. This will mean that when employees are paid, the employer's accounting software will automatically report payroll information to the Australian Taxation Office.
This will eliminate the need for employers to report Pay As You Go Withholding during the course of the year in their activity statements and employee payment summaries at the end of the year. Digital Services will make it easier to put on new employees and will streamline processes associated with the declaration of Tax File Numbers and superannuation forms.
Single Touch Payroll further builds on the Government's $254.7 million investment in the digital transformation agenda, making it easier for business and individuals to access government services.
Australia has also recently signed the Asia Region Funds Passport Statement of Understanding with Japan, Korea, New Zealand, the Philippines and Thailand.
The Asia Region Funds Passport aims to make the cross border issuing of managed investment funds easier across Asia. The Asia Region Funds Passport will not only reduce the amount of red tape faced by managers across the region, but will provide Australian investors with an even greater choice of investment products.
Importantly, this initiative will create a regional market for managed funds and provide fund managers with a better opportunity to compete for a larger share of Asia's savings.
Finally, the Government is currently working on our exciting new innovation agenda, on which the Prime Minister will have more to say shortly.
Closing remarks
Let me finish by saying that I am very grateful for you welcoming me here today. It is a pleasure to speak to an audience with vision, enthusiasm and the will to help Australia succeed - not just at home but abroad.
So I wish you all the best for today and as you look to continue to explore the exciting and trusted global gateway before us.
You can be confident the Government will be behind you each step of that journey.
Thank you, and enjoy the summit.
[1] "Ministry's Policy. Broadcast by Mr Menzies." Sydney Morning Herald, 27 April 1939.
[2] These statistics are from the DFAT website: http://dfat.gov.au/trade/agreements/chafta/fact-sheets/Pages/key-outcomes.aspx