Q&A, Perth USAsia Centre - Perth, WA

09 Jun 2021
Prime Minister

PROFESSOR GORDON FLAKE: You know, I wonder if you might talk a little bit more about what you see as the potential for hydrogen in your Government's priorities going forward. But more importantly for Australia's role in addressing on a technological level, the challenges of climate change.

PRIME MINISTER: Well, the development of hydrogen in Australia will be one of the most exciting developments and biggest game changers in the transformation of the Australian economy, the new energy economy that will be a reality over the next 30 years. It just so happens, I was talking to a Western Australian this morning, I was talking to Andrew Forrest earlier today and he was in another far-flung [inaudible] early hours of the morning. And what has been done in our resources sector, we were having that conversation at our table, is a transformation and a realisation of what the energy economy's going to look like over the next 40 years. So that's just the reality.

The way the world will move towards zero emissions, I'm a firm believer that will be realised by technology, entrepreneurship, it will be realised by commercial transformation. Governments can provide a context for it, they can provide a framework to support it. But all the great energy revolutions of the world, going back centuries have always ultimately come through technological change and commercial enterprise. That's what's actually changed the world each and every time. Gas revolution in the United States, a classic example of how that fundamentally transformed, not only the U.S. domestic economy, manufacturing, but also geopolitics. And there wasn't, barely a government involved in it. Technology exploration, commercial interests and entrepreneurism - the world changed. I see it playing out the same way, as the world moves into a new energy economy which is supporting a net zero emissions outcome. But the only way that will be achieved is where companies like in Australia, which I think will be the showcase on the world. Australia's resources companies, will be the showcase around the world for how they've transformed their operations in the new energy economy to do what they do and be the best in the world at doing it. So many look in at Australia from far away and they look at our resources industry and they tend to think this is the reason why the world is warming, but quite the contrary. I think it will be our resources sector that will demonstrate how the world will change because of the incredible technological revolution that has taken place in that sector, whether it's in a hydrogen powered mining vehicle. Significant [inaudible] companies operate in Australia have their targets and they have been fully operational in some cases this year. And this story of Australia's technological innovation whether it be in the resources sector, whether it be in the aluminium smelting business or green aluminium, green steel, all of these things. This is what will enable Australia to do this and that's what our technology roadmap is about achieving. It's about ensuring that the hydrogen hubs that will be set up around the country will see that combination of innovation, commercialisation, research, technology and partnerships.

And the partnerships I listed a set of countries in my remarks, whether it be Germany, the United Kingdom, United States, South Korea, Japan and many others. They're all for the same solve, and hydrogen is in the middle of every single one of these conversations. There is not a conversation that I have about net zero, a conversation that I have about the new energy economy, that does not have hydrogen at the centre of that discussion. And here in Australia, we will, I believe, have the best regulatory environment. That's what we must achieve. And we need to ensure that around the world that the regulatory environment and taxation environments and others, do not see the development of the hydrogen economy in any way held back. We need to ensure that our regulatory systems embrace it and nurture it and enable what they can achieve to be achieved. That's how you address climate change.

PROFESSOR GORDON FLAKE: Well, if our experience in Western Australia is any indication, in your upcoming conversations with Prime Minister Suga from Japan and President Moon from South Korea, I'm very confident they'll be raising Hydrogen with you.


PROFESSOR GORDON FLAKE: There is a really busy international summit calendar. And one meeting that didn't get as much attention as it should have in Australia, was that remarkable virtual summit that you held on the 13th of March, of the Quad, of the United States, Japan, India and Australia. And against expectations the agenda that came out of that was quite far reaching, focusing on obviously climate change, but also on vaccines and vaccine diplomacy and technology etc. It really marked not just the first time ever the Quad was held at a leaders level, but also a much broader agenda than that. So, in the context of now the G7, the work that you've done in the G20 in the past, would you help us place the Quad and tell us how you see that very important relationship moving forward in the Indo-Pacific?

PRIME MINISTER: Well, the first point I'd make is the point I make about the G7 Plus dialogue, and that is it is not a club. Not a club. It is a group of like-minded partnerships, liberal democracies, advanced economies that share a set of interests for a free and open Indo-Pacific, and that we want to enable that by our collective efforts, not just in areas which have been traditionally in defence cooperation, but more broadly in technology, in supply chains, in humanitarian efforts, in emergency response, in health and social policy, to demonstrate that this group of liberal democracies, advanced economies, which have benefited greatly from the region, are also investing back to part of the region to ensure that that prosperity and that freedom and that independence and that sovereignty can be enjoyed by all the nations of the Indo-Pacific.

We see the Quad together as leaders as an enabler. We see it as an accelerator of freedoms and prosperity and living standards within our region. We each individually do many things. And Australia has had and continues to have a remarkable relationship with ASEAN, and particularly Australia and Japan, because we live here, and India specifically, we understood the importance of the Quad and ASEAN being central to this outlook for the Indo-Pacific. And so this is why this is not a grouping, as I said, as a club that is seeking to compete or differentiate itself, it is another forum in which we are participating together to enable whether it is the agendas for these outcomes that ASEAN is pursuing. Or how we engage with that together through the East Asia Summit, which I put this as one of the first meetings that go in my calendar every year, if not the first. I can see Stephen nodding, I am sure it was the first in yours too. It is the most important meeting in our region because it brings together so many economies from so many different perspectives. So we take that very, very seriously. And I greatly appreciate it, from the President, his understanding of that and the importance of ASEAN and how it's about enabling the nations, their capability, their self-sufficiency, their sovereignty, their independence and so it's important for us as a Quad to keep reassuring the region that this is what it's about.

Now, equally we all share a view that it is another opportunity to demonstrate the virtue and value of liberal democracies and to see markets succeed. We're here to see trade expand. We're here to see technology transfer. We're here to enable all of those things, beyond what some might have seen purely in a quite narrow security, defence interests, which is of course important. But it is just so much more than that. And I think the President articulated it well in our meeting, and he enjoyed warm support from the rest of us who have been having those discussions, the three of us, Narendra and even most recently, Yoshi and I, and before it was Shinzo Abe, who was a key driver of that dialogue throughout the region.

PROFESSOR GORDON FLAKE: So the quote that in your speech that struck me is that quote that you attributed to President Biden saying that the Quad must demonstrate that liberal democracies at work. And I think you're probably pretty pleased with the press coverage today about your trip to the G7, suggesting that a strong economy and a remarkable response to COVID, that you're in a strong position. But, in some respects, the G7 Plus is preaching to the converted. So you highlighted that you can go back to the Biden quote, we have to prove that liberal democracies work to a broad audience. So the question I would have, whether it was ASEAN or the rest of the world, what does the G7 Plus or the Quad need to do to get the message out?

PRIME MINISTER: To get involved. So, I maybe don’t share the assessment of the- I'm not going to there to tell other liberal democracies that liberal democracies work. If they haven't worked that out by now, I can't help them. And they do know, they do understand. It's about, that we need, like I suspect in no time we've had to for a very long time, to be aligned in how we get that message across to the rest of the world that liberal democracies do provide a pathway to prosperity and freedom, which is incredibly important. And we believe that leads to greater stability within the region. And we respect other nations and their borders and their sovereignty, and whatever system they have in place. Like-minded is a term we tend to use, and it doesn't only refer to liberal democracies. I'll give you an example. Australia's relationship right now with Vietnam has probably never been better. Not saying that it was bad before, but it has been building over many years. We share, Vietnam and Australia, very similar views on the challenges and issues within the Indo-Pacific. Particularly, in the South China Sea, freedom of navigation and [inaudible], and all of those issues, we share very similar views. We share very similar views on trade. We share very similar views on technology. And on COVID. I just spoke to the new Prime Minister very recently and this is what we were discussing. So the message to G7, the message for Quad is we live here, we are involved. But what I'm seeing is that there's a need for greater alignment amongst liberal democracies a little bit further from here, that what is happening here in the Indo-Pacific and the strategic competition, which is occurring [inaudible], Australia and countries of the region, it extends globally and it is necessary for that appreciation to be stressed, or I should say enhanced. And I'm seeking to encourage even greater alignment amongst the liberal democracies of the world to understand where we're at right now and what we all need to do.

PROFESSOR GORDON FLAKE: So let me ask one final question that I think will be of particular interest here in Western Australia, where there is such an intense reliance on exports, upon the liberal rules-based system. In your remarks, you made a very clear point that it's not about a closed circle. It's about maintaining an open rules based system. I wonder if you make an assessment of number one, where do you think the primary challenges are to that rules-based system? And then the particular role of Australia, we're one member now of the G7 Plus, we are one member of the Quad, we are one member of the G20, what is our role? Because, again, we do have this mantra about a rules based order, a liberal rules based system, because we rely on it so much. What is our role in maintaining it and expanding it?

PRIME MINISTER: Well, I have two favourite quotes which go to the answer. One was from Bill English, the former New Zealand Prime Minister who said 'no one's ever got rich selling things to themselves.' And he said that at a dialogue that we had, which was pointing out that Australia and New Zealand are shared in our outlook about the need for trade to be the basis of our prosperity as trading nations. So Bill's right. And Australia's prosperity will always depend on being an open trading environment. The second one relates to how do you eat an elephant? One bite at a time. And that's what dealing with reform in the WTO is a bit like. But that doesn't mean it's not time to chow down. You need to. You need to take each and every step.

Now what are the steps that can be taken? The two biggest challenges and Robert and I were discussing this at the table before. Of course, the Appellate Body and the frustrations that have been present there for some time, need to be resolved. Need to be sorted. This thing needs to start working again and resolving disputes. The other part is these organisations can be incredibly bureaucratic and they can take an enormously long time. And so it's important that the justice of the outcomes around trade disputes not just be delivered, but delivered in a timely way and we need to redouble our efforts to ensure that can be achieved. Otherwise, the rules based order will become impotent when it comes to these things. Now, you can start to do that, this is the one bite at a time principle, by focusing on particular areas where you may speed it up. Our digital trade agreements, we concluded one with Singapore a few years ago now, and what we've done in trying to reform rules around digital commerce and online commerce has been one of the more positive developments where we have seen [inaudible] take place in this space. Disputes are best resolved if they never have to end up in those processes, but knowing they work and they'll be there is integral to ensure the front-end of it more effectively. So I think where Australia's focus is ensuring that there are standards and various agreements are existing between nations, in new areas of commerce, are very compliant with what the broader principles are.

So, our technicians in the trade space are doing a lot of work [inaudible], and we've got a lot of kudos and a lot of good credibility, I think the progress we're making there. So we'll keep doing that. It's a very painstaking and detailed agenda and it just requires continued application and having more like minded nations around the world working with us to that end. And the larger economies of the world will always have particular interests that sometimes can clash with these reforms efforts and we've seen that. And I'm not talking about China, the US position in these areas has of course been greatly frustrating. But we can have those honest conversations with them and I look forward to having them again, and Australia won't be the only one making those points. But we make those points as friends, seeking the outcome that we both wish to see achieved.

PROFESSOR GORDON FLAKE: On these specific issues, let me congratulate your Government on its foresight in supporting the candidacy of our mutual friend and your former colleague and our former Senator from WA, Mathias Cormann, who is Secretary-General of the OECD. I know for the past week he's already been in London, ahead of the G7 Finance Ministers meeting, wrestling with many of the exact same issues. So a pretty impressive advance team you've got.

PRIME MINISTER: Well just on the Mathias point, because it goes to what you were just asking. We have taken a very targeted approach to a number of multilateral fora, where we think we can add value and the OECD is a critical one. And the reason we decided to do that was to that the OECD brings together the liberal democracies of the advanced world. And so finding commonality across a whole range of these, what are often quite technical issues in regulatory systems and tax systems. That's what makes the economy work if it achieves the type of reform across jurisdictions. So Mathias will do a great job in that way, he's someone who believes strongly in business led growth, not government led growth and that's certainly our view. We see that this is the way the world will recover from the COVID-19 pandemic, it'll be businesses and business led economies that do that in the developed world.