Industry-Innovation-and-Competitiveness-Agenda

Recommendations

Info

Co In Industry Innovation and Competitiveness Agenda TPO00007 The Case for Reform Australia has enjoyed 23 years of uninterrupted economic growth, in large part due to the economic reforms of past decades and the massive boost to our incomes from the resources boom. Our living standards have consistently been in the top dozen in the world over the past two decades. Nonetheless, Australia faces some difficult challenges and adjustments in the years ahead. Declines in the prices of our exports have wiped around $40 billion from national income per year since the commodity price peak in 2011, and further reductions are expected (ABS, 2014b). Australia’s public finances have deteriorated markedly since the global financial crisis, as governments across Australia spent money they did not have. Australia’s public sector collectively shifted from being a net creditor of 7.3 per cent of Gross Domestic Product (GDP) in 2007-08 to a net debtor, with public debt projected to increase to around $324 billion by 2016-17, or over 18 per cent of GDP (Commonwealth of Australia, 2014b). Meanwhile, after growing by around 2 per cent annually on average in the 1990s, multifactor productivity has essentially been flat since 2003 (Productivity Commission, 2013c). Our production costs have become some of the highest in the world and overall jobs growth has been soft outside publicly funded sectors. Australia also faces some difficult adjustments as our population ages. The number of working-age people to support each retiree has already fallen from seven and a half in 1970 to five today, and is expected to fall to below three by 2050 (Commonwealth of Australia, 2010). These domestic challenges alone necessitate action, but Australia also faces an increasingly competitive and uncertain international environment. While the opportunities are great, the changes taking place in the international economy also present further challenges to our living standards. Only by reforming and grasping the opportunities which the world affords us can we assure our living standards in the decades ahead. Opportunities and challenges in the global economy The economic strength of Asia is changing the world. Economies like China, India, Indonesia, Vietnam, Malaysia and the Philippines have grown dramatically over the past 30 years and this is projected to continue (Au-Yeung et al, 2013). While similar to the experience of earlier movers like Japan and South Korea, the scale of the current rise is unprecedented. By 2025, China will be the largest economy in the world and the GDP of emerging Asia 1 will be around US$51 trillion (Chart 1), 2 approximately five times all the already-developed Asian economies combined (Au-Yeung et al, 2013). Emerging Asia represented around 9 per cent of the global economy in 1985. By 2025 it will be around 40 per cent (Au-Yeung et al, 2013). 1 Emerging Asia includes: China, India, Indonesia, Malaysia, the Philippines, Thailand and Vietnam. 2 Purchasing power parity in 2011 dollars. 2 Industry Innovation and Competitiveness Agenda
Chart 1: The growth of emerging Asia 60 50 40 30 20 10 GDP Trillion 2011 US$ (PPP) Emerging Asia Projection Developed Asia 0 0 1985 1995 2005 2015 2025 Data Source: Au-Yeung et al, 2013. 60 50 40 30 20 10 The expansion and enrichment of Asia’s middle class is increasing demand for all manner of goods and services, from energy, high quality food products, and advanced manufactured goods, to health care, education, tourism and financial services. For example, by 2050 the real value (in 2009 US dollars) of beef consumption in China is projected to rise by 236 per cent, dairy consumption by 74 per cent, and sugar consumption by 330 per cent (Hamshere et al, 2014). More generally, China’s share of global demand for luxury goods is projected to double to around 20 per cent by 2020 (CLSA, 2011). Meanwhile, many Asian economies are becoming major new suppliers of these same goods and services, bringing serious competition to the global stage (Chart 2). To date, this has mainly occurred in less skill-intensive goods and services. Emerging Asia has increased its share of global manufacturing output from around 6 per cent in 1982 to 29 per cent in 2012 and its share of services exports has grown from 6 per cent in 2003 to 11 per cent last year (United Nations, 2013; 2014). As Asian economies Chart 2: The shifting centre of economic gravity invest in education, skill up (Chart 3) and move up the value chain, they are Per cent of world output 30 30 producing more advanced goods and Projection services. In 2000, China produced around United States 25 China 25 6 per cent of the world’s communication equipment; by 2010 this had increased 20 20 to 26 per cent (National Science Board, Euro area 2012). Alibaba, a Chinese online sales 15 15 company, is now larger than Amazon Emerging Asia 10 10 and eBay combined, and still growing (excl China) (Osawa et al, 2014). 5 0 0 1985 1995 2005 2015 2025 Note: GDP adjusted for purchasing power parity (2011 prices). Data Source: Au-Yeung et al, 2013. 5 Industry Innovation and Competitiveness Agenda This growth is taking place against a backdrop of a global economy that is becoming increasingly integrated. Advances in technology have made communication and transportation faster TPO00007 In Co THE CASE FOR REFORM 3
Page 1 and 2: Industry Innovation and Competitive
Page 3 and 4: Industry Innovation and Competitive
Page 5 and 6: Foreword Strengthening Australia’
Page 7 and 8: The Government’s economic vision
Page 9 and 10: Box 1: Key Initiatives • Encourag
Page 11 and 12: Ambition 1: A lower cost, business
Page 13 and 14: y improving regulatory certainty, t
Page 15 and 16: Ambition 2: A MORE SKILLED LABOUR F
Page 17 and 18: ecommendations of an Independent In
Page 19 and 20: Ambition 3: BETTER ECONOMIC INFRAST
Page 21 and 22: Ambition 4: INDUSTRY POLICY THAT FO
Page 23: Part A THE CASE FOR REFORM
Page 27 and 28: The changing global economic landsc
Page 29 and 30: Chart 5: Overseas investment 2,500
Page 31 and 32: United States, Japan and the United
Page 33 and 34: Box A1: Industries with promise 1.
Page 35 and 36: 6. Innovative pharmaceuticals, biot
Page 37 and 38: Many of our competitors have recogn
Page 39 and 40: • Better management practices - w
Page 41 and 42: including on Energy, Taxation, Agri
Page 43 and 44: Part B THE REFORM AGENDA
Page 45 and 46: competition with private businesses
Page 47 and 48: More generally, while there is a ca
Page 49 and 50: Ambition 1: A lower cost, business
Page 51 and 52: The Government’s Deregulation Age
Page 53 and 54: Further Proposals Proposal 1: Accep
Page 55 and 56: whether coverage by a single nation
Page 57 and 58: The Government is committed to a be
Page 59 and 60: Improving access to high-quality, l
Page 61 and 62: services and technology. These alig
Page 63 and 64: The Government considers that Austr
Page 65 and 66: The Government is focused on promot
Page 67 and 68: Ambition 2: A more skilled labour f
Page 69 and 70: A number of the other themes raised
Page 71 and 72: Vocational education and training t
Page 73 and 74: Further proposals Proposal 9: Incre
Page 75 and 76:
• managing the administration of
Page 77 and 78:
The Government will continue to ens
Page 79 and 80:
• introduce a Premium Investor vi
Page 81 and 82:
a right to access workplaces includ
Page 83 and 84:
Ambition 3: BETTER ECONOMIC INFRAST
Page 85 and 86:
Increasing public investment in eco
Page 87 and 88:
Alongside this work, the Government
Page 89 and 90:
To leverage private investment, the
Page 91 and 92:
Austrade provide reliable informati
Page 93 and 94:
and senior Cabinet Ministers to pri
Page 95 and 96:
• taking practical steps with gov
Page 97 and 98:
However, we face challenges in turn
Page 99 and 100:
Employee Share Schemes (ESS) are us
Page 101 and 102:
Example: Making it easier for emplo
Page 103 and 104:
Proposal 16: Crowd-sourced equity f
Page 105 and 106:
PART C: IMPLEMENTING OUR ECONOMIC A
Page 107 and 108:
Many of the drivers of competitiven
Page 109 and 110:
Table 3: Consultation pathways Refo
Page 111 and 112:
Reform Consultation pathway Project
Page 113 and 114:
Abbreviations AND References
Page 115 and 116:
INSEAD KPMG LNG PAYG NCC NCVER NICN
Page 117 and 118:
ABS. (2014j). Labour Force, Detaile
Page 119 and 120:
Business Council of Australia. (201
Page 121 and 122:
Department of Infrastructure and Re
Page 123 and 124:
Lignier, P., Evans, C., & Tran-Nam,
Page 125 and 126:
Prime, P. B. (2012). Utilizing FDI
Page 127 and 128:
United Nations Food and Agriculture
Page 129 and 130:
© Commonwealth of Australia 2014 9
Page 131 and 132:
Co In Industry Innovation and Compe
show all

Industry-Innovation-and-Competitiveness-Agenda

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?