Guest writer Asher Judah is the author of The Australian Century (1):
The Australia in the Asian Century White Paper which was launched with much fanfare in October 2012 epitomises everything that is wrong about how Australia thinks about its future.
The forecast addition of 3.1 billion new middle class consumers will be the most significant socioeconomic event to occur on our planet this century, yet as part of the former Government’s response to it, they chose to ignore 34 per cent of those taking part in it (not to mention the world’s non-Asia Pacific rich). For some inexplicable reason, the disproportionate spending habits of North America and Western Europe, as well as the unrealised benefits of socioeconomic development in South America, Eastern Europe, Africa and the Middle East, were all deemed irrelevant to Australia’s future when devising a plan for the twenty-first century.
This omission represents an unforgivable lapse in government thinking. It also reveals how badly our leaders are mishandling this century.
In the decades to come, it will not be the scattered momentum of continental Asia which holds the attention of the global community. Nor will it be the lack of it within an ageing and demographically declining Europe. Rather, it will be the relentless and upward surge of Australia.
Much like how the world marvelled at our ability to sail through the GFC without experiencing recession, during this century, Australia’s unique identity, capacity for growth, inherent flexibility and seemingly limitless potential will be what truly impresses the world.
Australia’s gold rush reprise
In 1851, the discovery of gold in Victoria transformed Australia’s weakest colony into the continent’s pre-eminent one.
Within ten years of it commencing, the colony’s population had increased sevenfold; its cities and regional towns had been revolutionised and its economy had exploded in size. What was just five years earlier destined to remain a minor colonial player had leapfrogged its more promising rivals to become the continent’s biggest and most productive colony.
In this century, the massive expansion of the global middle class will have the same effect on Australia. But instead of this process being driven by a dozen isolated and landlocked goldfields, this reprise will be powered by an archipelago of world class mines, gas wells, farms and vibrant coastal metropolises.
For the raw materials, energy and food product industries, the global middle class’ expansion will be responsible for unleashing a sustained increase in demand for nearly every product they produce. With the associated demand cycles lasting decades, perhaps even forever, vast geographical regions and industry related cities will be energised as a result of increased capital inflows, labour force movements and logistical infrastructure development. Indeed, for as long as the expansion continues, Australia’s primary economy, terms of trade and strategic importance in foreign affairs will be overwhelming and positively enhanced.
Australia’s industries with expertise in technology, service delivery and wealth and information management will also greatly benefit. Through a combination of Australia’s time zone happenstance and its multi-century experience with urbanisation, city planning, healthcare, retailing, education, financial management, mining, agriculture, infrastructure, utility generation, distribution grids, recycling, sustainability and professional governance, millions of gifted workers and savvy business people will find success and opportunity in an increasingly service hungry world. As with the global commodity export boom, the global services boom will have a transformative effect upon Australia. However, in the cases of the tertiary and quaternary economy, it will be the most dynamic service centres which enjoy the greatest uplift.
In tandem, the swelling of these two economic areas will bring about a golden age in Australian society. As weaker nations wrestle with the economic disruptions caused by a rapidly transforming global economy, Australia will be growing into it. As developing nations grapple with the internal upheaval that massive socioeconomic change invariably creates, our migration programme will be gorging upon it. And as poorer nations struggle to feed, power, resource and service themselves, Australia’s natural resource and service exporters will be making a fortune.
Through a combination of a surging economy, booming exports, intense foreign investment, high employment, rising corporate tax revenue, strong population growth and rapid technological change, the global middle class’ expansion will not only enrich the broader Australian community, it will create a strong sense of momentum which will define the nation’s international reputation for decades.
Obstacles to prosperity
Of course, just because global events will be aligning in our favour, doesn’t mean unbridled success will become a sure thing.
As much of the established world has demonstrated over the past century, careless or carefree management can easily evolve into a record of consistent incompetence, obliterating hard earned domestic prosperity.
To ensure Australia doesn’t miss its moment to shine, five key obstacles will need to be tackled. These are:
- overcoming demographic weakness;
- avoiding a productivity slump;
- reversing the decline of responsive government;
- administering population growth; and
- managing its population islands.
In isolation, each of these obstacles has the potential to derail Australia’s potential this century. In combination, their side-effects could be far more devastating. As a result, if Australia wants to maximise its capacity for achievement, each obstacle will need to be overcome.
In 1786, Georg Forster, a former passenger on board Captain James Cook’s Resolution voyage corresponded about the future prospects of Australia. He surmised:
New Holland, an island of enormous extent or it might be said, a third continent, is the future homeland of a new civilized society which, however mean its beginning may seem to be, nevertheless promises within a short time to become very important.
Without knowing it, Forster’s forecast about Australia’s potential was prescient.
Over the 228 years which has followed, the tough prospect which Australia appeared to be has slowly transitioned to become one of the happiest, healthiest, freest, most tolerant, inclusive, peaceful and wealthiest nations on Earth. In a little over two centuries, a territory which was once judged to be the least habitable place for humanity has evolved to become one with the greatest lessons to teach it. As Forster boldly predicted, Australia has indeed become something “very important”.
In this century, the Australian Century, Australia will have the opportunity to achieve extraordinary feats. It now only needs the vision, organisation and motivation to see its full potential become a reality.
This century is our century. It’s time to go and seize it.
The Australian Century ($29.95) is published by Connor Court Publishing.