Australia`s Minister for Finance, Mathias Cormann, grew up in the German speaking part of Belgium and followed German politics very closely since the early 1980s. His experiences put him in the unique position to pave the way to an even closer cooperation between our countries.
It was during my second year at law school in Belgium back in 1989 that the Berlin wall came down and that a very exciting period in European history began. With friends, I travelled to Berlin just before Christmas that year to be, in a small way, a part of that history. Germany has achieved much since reunification, building on the tremendous success of West Germany in the postwar period and growing into a prosperous and peaceful nation at the heart of Europe. More than a quarter of a century after my 1989 visit to Berlin, modern Germany is an economic powerhouse that shares a common global outlook with my adopted home of Australia. Both nations have common interests on matters of security and counter-terrorism and support a rule-based global order. We also share democratic values and have an understanding that through the promotion of trade and commerce we can continue to foster economic growth and prosperity. But one thing we have not shared until recently is a particularly close relationship, despite our common interests and aspirations. Perhaps traditionally it was too hard to attract each other’s attention, with many people believing we were just ‘zu weit weg’ – too far away.
The dynamic of our relationship rapidly began to change in 2015 with the establishment of the Australia-Germany Advisory Group. The advisory group consisted of business, industry, science, defence, academic and cultural leaders from both countries who contributed to the development of a report to develop closer ties between our two nations. Professor Maria Böhmer, Secretary of State in the German Federal Foreign Office, and I co-chaired the Australia- Germany Advisory Group and since its creation there has been a positive quantum leap forward in terms of the quality and the calibre of our bilateral partnership.
In November 2015, the advisory group presented its 59 broad-ranging proposals and recommendations to strengthen our bilateral partnership to German Chancellor Angela Merkel and Australian Prime Minister Malcolm Turnbull in Berlin. Since that time, more than fifty Australian and German organisations have collaborated to make substantial advances in cooperation and 54 of the report’s recommendations have so far been either fully implemented or are well advanced. This process has also delivered a materially enhanced bilateral architecture, which has strengthened dialogue and collaboration between our governments and private sector groups. In particular, the inauguration of a biennial 2+2 Foreign and Defence Ministerial Meeting in September last year marked a historic milestone in the development of our political and strategic relationship and led to constructive discussions on a range of foreign policy and security challenges, demonstrating the value of sharing each other's assessments of global issues.
Beyond our strategic relationship, the implementation of the advisory group’s proposals has supported a substantial increase in direct business-to-business interaction.
In 2015, Australian investment in Germany was about $60 billion and German investment in Australia was only $40 billion. Today, Australian investment in Germany has grown by more than ten per cent to over $67 billion, while German investment in Australia also grew by about $1.2 billion. Australian merchandise trade with Germany has grown 10.3 per cent year on year and exports of Australian services to Germany have grown by 9.1 per cent year on year, while German services exports to Australia have grown by 14.5 per cent. These are all positive signs that point towards growing business-to-business linkages and lay the foundation for significant future growth in trade. Increased trade and investment flows are being supported by a range of initiatives that have provided a framework for increased trade and investment in the coming years.
This includes a revised double taxation agreement between Australia and Germany that was signed in November 2015 after being developed in record time. The agreement provides increased certainty for businesses in Australia and Germany by reducing tax impediments to trade and investment. Both governments have also reaffirmed their commitment to liberalising trade and investment through a future Australia-EU Free Trade Agreement. The German Government continues to advocate the benefits of an FTA and the newly launched EU-Australia Leadership Forum will provide valuable public advocacy for FTA negotiations.
In Australia’s assessment, the Asia-Pacific is the part of the world which will - as it has for some time - continue to generate most of the global economic growth for many years to come. Australia is in a unique position to foster closer German and European engagement with Asia. Australia’s recent success in signing significant bilateral trade deals in Asia is evidence of Australia’s commitment to free trade and enthusiasm for closer engagement with our Asian neighbours. German businesses and investors should think of their presence in Australia as a way to facilitate closer engagement with Asian economies. Australia offers proximity, established links and deep expertise about Asian societies and economies that can provide opportunities for more successful engagement in the region. In November last year, I led a business delegation with the German Australian Chamber of Industry and Commerce to the biennial Asia-Pacific Conference of German Business (APK) in Hong Kong. The Australian delegation was the largest third-country delegation in attendance, which is indicative of the growing commitment of Australian business to deepening links with Germany and Asia. The high interest led to the initiative to introduce the first Asia-Pacific Regional Conference to be held in Perth from 3-5 November this year. It aims to bring together business and government leaders from Germany, Australia and the Asia-Pacific to showcase the opportunities in each other’s developed and emerging industries. I am honoured to be the patron of the conference which will be the largest ever gathering of Australian, German and Asian business and political leaders to explore future opportunities for business, trade and investment in the Asia-Pacific region.
Australian Prime Minister Malcolm Turnbull will open the conference, which will provide a platform for up to 1,000 company representatives to develop tangible business opportunities during the two day program. The Asia Pacific Regional Conference represents an important opportunity to explore future enhanced opportunities for business, trade and investment in the Asia-Pacific region, with a multi-sectoral focus including mining, agritech and food supply, resources and energy, disruptive technologies and innovation, educational and vocational training, and the defence and shipbuilding industries. This conference is the culmination of several years of work to broaden, deepen and strengthen the Australia-Germany relationship and will lead to new and exciting business opportunities between Australian and German businesses in the Asia-Pacific region.
Significant progress has been made in bringing Australia and Germany closer together over the last couple of years, and there is still plenty more that can be done as the proposals of the Australia-Germany Advisory Group continue to be implemented in the coming months and years. Developing closer people-to-people and business to-business linkages through fora such as the Asia-Pacific Regional Conference will be critical to strengthening relations even further and expanding the scope of bilateral trade and investment. Our relationship has certainly come a long way in recent times, and it would be fair to say that rather than ‘zu weit weg’, Germany and Australia are now ‘enger als jemals zuvor’ – closer than ever.