The Lucky Country or the Lonely Country?

FIRST PUBLISHED: Australian Financial Review, 25 Oct 2012

While we await the release of the government’s Australia in the Asian Century white paper this month, it’s evident that Australia has overestimated its integration with Asia and needs a wake-up call. The current rhetoric around Australia benefitting from the Asian Century is at best ill-informed and, at worse, reeks of complacency. How it is addressed will form both the conceptual and practical foundations for the country’s capacity to thrive over the next 100 years.

CPA Australia commissioned Harvard alumnus and country competitiveness expert professor Michael Enright to undertake the largest independent survey of Australia’s international competitiveness. It garnered the views of more than 6000 business decision-makers from Australia and overseas. The initial findings, released by CPA Australia in the report, Australia’s Competitiveness Survey: Preliminary Findings, found Australian respondents typically placed a relatively low level of importance on access to, and knowledge of, Asian markets and bilingual staff, while overseas respondents generally rated Australia as relatively poor in its knowledge of Asia and its languages. This lack of Asian literacy obviously impacts business decisions concerning expansion into Asia.

If people in Asia are not seeing Australian business actively engaged in the region nor seeing Australians making any real effort to understand the languages, cultures and histories of the region, it should come as no surprise that the survey results show that Australia is regarded as an economy isolated from Asia.

The message to business and the broader community has been clear for some time: structural changes to the global economy brought about by the re-emergence of Asia and the global financial crisis cannot be ignored. However, our research shows that many Australian businesses seem to be doing just that. Without significant changes in the mindset of Australian businesses, supported and encouraged by government, particularly in the form of policies that substantially increase Asian literacy, Australian business will remain poorly placed to take advantage of the Asian Century.

CPA Australia can speak from experience, having had a presence in Asia for nearly 60 years. During this time we’ve established a permanent presence in the region, including offices in east Asia and south-east Asia in countries including China, Vietnam and Indonesia. This strategy has been crucial for our growth.

While Australia’s current and future prosperity is tied to Asia like never before, as a nation we are often guilty of lapsing into an ignorance of Asia, its diverse cultures, languages, long history and complex politics. This point is perfectly illustrated through the fact that in Australia only 8 per cent of Year 12 students currently study an Asian language, and a large proportion of these students are already native speakers of that language. CPA Australia strongly believes that the Australian government should fund a review into making the study of Chinese language compulsory in all Australian primary and secondary schools. In addition, the Australian government should offer incentives, such as a FEE-HELP exemption or reduction, for non-native Chinese speakers to enrol in Chinese language courses at university.

A great national effort is required to build a high level of understanding and familiarity for Australians with the rest of Asia. This demands bold and visionary leadership from both sides of politics and will be an intergenerational effort that future governments, whatever their political persuasion, should embrace, rather than focus on short-term political gains that do nothing to address long-term economic growth and prosperity.

The forthcoming white paper offers both the government and the opposition a clear opportunity to put tangible policy stakes in the ground within which a comprehensive strategy of engagement with Asia can be framed. As a start, the government should appoint a dedicated cabinet minister to coordinate and oversee its consultation on, and implementation of, the recommendations of the Asian Century white paper. Furthermore, an office should be established within the Department of the Prime Minister and Cabinet to coordinate and oversee the response of agencies to the white paper and support the minister.

Regardless of geographic proximity, there is a strong risk that without a change in mindset by Australian business, underpinned by government policy, Australia will be a peripheral player in the Asian Century or, even worse, a spectator.