Speech to Australia-Africa Business Council

Speech, delivered by Melissa Parke MP on behalf of Foreign Minister Kevin Rudd. Check against delivery, E&OE

24 February 2011

Good evening everyone.

I start by acknowledging the Ngunnawal and Ngambri peoples as the traditional owners of the land on which we are meeting and pay my respects to their elders past and present.

I am delighted to be here, representing the Australian Government, at the Australia-Africa Business Council's inaugural national dinner. I acknowledge the National Chairman Bill Repard, Charles Millward President ACT Chapter and the members of the AABC, David Peever Managing Director Rio Tinto Australia as well as the many eminent diplomatic representatives from African countries and other distinguished guests.

The AABC is a valued partner of government. We recognise its importance in promoting commercial relations, and trade and investment links with Africa.

The focus of my speech will be on the nature of Australia's enhanced engagement with Africa, particularly in sub-Saharan Africa.

But it is appropriate I first speak to the momentous events that have over the past two months swept North Africa from Tunis to Tripoli to Cairo and beyond.

Australia has long encouraged peaceful, democratic reform across the region. We believe this is important to meet the political, economic and social aspirations of the region's people.

The Australian Government and Foreign Minister Rudd in particular have been working hard in recent days to support a peaceful and stable democratic transition in Egypt.

Mr Rudd has been speaking to Egyptian Foreign Minister Aboul Gheit (most recently on 21 February), as well as other foreign ministers and the heads of international organisations about how to respond to Egypt's transitional needs.

A senior official from DFAT represented Australia at a meeting overnight in Brussels to consider how to coordinate the international community's response.

Mr Rudd tonight travels to Africa for meetings in South Africa before he heads to Egypt on the weekend. There he will work with his Egyptian counterparts on how best to render international assistance, including from Australia.

Later next week, Mr Rudd will also visit Tunisia. And he will also visit Geneva to attend a meeting of the UN Human Rights Council, which is considering options to respond to the situation in Libya as we speak.

Australia called last week for action on Libya by the UN Security Council. We welcome the strong statement the Security Council has issued condemning violence against protesters and calling for those responsible to be held accountable.

So Australia will work collaboratively with other states on the practical and immediate challenges that lie before us across North Africa.

And we with others in the international community continue to call on the governments of North Africa, and indeed anywhere else, to respect the right of citizens to peaceful protest - dialogue is the best solution to citizens' calls for reform.

The Australian Government is of course ramping up our efforts right across Africa delivering on our promise for much deeper engagement.

Less than a month ago Mr Rudd visited Ethiopia where he opened a new mission in Addis Ababa and addressed the African Union.

It was the second time in less than two years an Australian Foreign Minister had addressed the AU Executive Council.

In that address the Minister said:

"Australia has confidence in Africa's future. The twenty-first century looms as a great century not just for Asia but also Africa. Australia wishes to embrace a new engagement with this continent for the future."

Why Africa matters

Australia wants to embrace this new engagement because we are as much a country of the Indian Ocean as we are a member of the Pacific. As the Federal Member for Fremantle, I can tell you that this is very clear to me.

Both Australia and Africa are vast continents of climatic extremes, from deserts to tropical rainforests.

Our land sets us challenges at times, but it also provides our prosperity.

Australia is one of the world's biggest mining countries.

Industries of the land such as mining, agriculture and forestry account for more than half of our export earnings.

Africa too has a wealth of natural resources.

It has, for example, 60 per cent of the world's uncultivated, arable land.

It has 12 per cent of the world's petroleum and 30 per cent of the planet's known mineral reserves.

Africa is either first or second by share for known reserves of platinum, diamonds, cobalt, gold and bauxite.

And investment into Africa is now booming.

The flow of foreign direct investment increased from $10 billion in 2000 to $59 billion in 2009.

This is significantly larger than the flow to China if measured relative to GDP.

It is more than a twelve-fold increase from the $5 billion annual inflow of 1989.

What has spurred this boom is a determination by Africans to turn their continent around.

Peaceful conclusions to longstanding conflicts, more open political systems, structural economic and financial reforms and greater openness to foreign investment has made Africa a more stable and prosperous continent than it was.

In 1995 there were 15 wars active across the continent.

Last year only five wars and incidents of civil unrest were recorded.

Around 35 countries in Africa now elect their governments through multi-party polls.

This is compared to just three democracies 30 years ago.

These political and economic reforms have provided the basis for an impressive economic turnaround in Africa.

Over the past decade sub-Saharan Africa's real GDP growth rate jumped to an average of 5.7 per cent, up from 2.4 per cent over the previous two decades.

Three of the world's fastest-growing economies of the past five years were from sub-Saharan Africa.

And the IMF predicts four of the top 10 in the next five years will also be from the continent.

McKinsey estimates that Africa has as many middle-class households as India.

For all these reasons, Africa has a vested interest in its future stability.

The crisis in Cote d'Ivoire showed clear recognition, as Foreign Minister Rudd put it, "that trashing democracy will cruel the brand of this new Africa."

Africa's political gains over the past decade have been too hard-fought-for to let go now.

Australia's resource sector has long recognised Africa's potential.

Australian minerals and resource companies have in fact more projects in Africa than in any other region of the world.

The number of Australian companies now engaged in Africa is growing on a monthly basis.

To keep abreast of this rapid growth, The Department of Foreign Affairs and Trade established a database of Australian business activity there.

It puts the number of Australian companies that have assets in Africa at more than 220. 200 of these are involved in mining.

They account for 600 individual projects, 560 of these in mining, spread across 42 countries.

Some 48 companies and 143 new projects were added to the list in 2010 alone.

In total, these projects account for around $20 billion worth of investment.

Figures released on likely spending on new projects show there are billions more in the pipeline.

It is undoubtedly the most impressive chapter of the Australia-Africa investment story.

As Foreign Minister Rudd put it during his visit to the continent, supporting this investment "is core to our interests".

The Australian government supports Australian businesses in Africa

The government is working to provide a better framework within which Australian businesses can operate in Africa.

We have expanded our diplomatic engagement with the continent.

Australia now has diplomatic relations with 52 of the 53 African countries, compared with only 41 back in 2007.

We have strengthened our presence on the ground, opening a new mission in Addis Ababa and boosting the number of Australian staff at our posts in Abuja, Accra, Cairo, Harare and in Nairobi.

Austrade has also opened offices in Accra and Nairobi, staffed by local business development managers whose primary focus is on mining.

Since 2007, DFAT and Austrade have organised a major promotion of Australia at Indaba, the biggest global conference on mining in Africa, held in South Africa.

The centrepiece of the promotion has been the Australian lounge in which the government has worked with business to provide a first class networking area for Australian businesses and African decision-makers.

We are keen participants in the Africa DownUnder mining conference held in Perth every year, with the government hosting an official dinner last year for African mining ministers and CEOs.

Of course Australia will be hosting the Commonwealth Heads of Government Meeting in Perth in October this year at which 19 African leaders will be present. There will be a parallel business forum at CHOGM which will provide myriad opportunities for Australian business to connect with African leaders and business.

The Australian government has established regular consultations between relevant government agencies and the recently established Australia-Africa Mining Industry Group.

Of course the government is also assisting Australian businesses that work outside mining.

Austrade has recently been looking at opportunities to expand agribusiness and build an agribusiness export market.

In addition to the assistance that can be provided by Australian government agencies such as Austrade and ACIAR in fostering Australia-Africa economic relations, investment and research, an important role will be played by Australian-African business and professional associations like hosts for this evening, the Australia Africa Business Council, which started life as the Australian Southern Africa Business Council, but since 2006 has covered all of Africa.

Bodies like these have a key role to play in developing links between the public and private sectors and promoting business, investment and economic initiatives between Australia and African countries.

Aid and humanitarian engagement

The Australian government believes that our business activities in Africa will not only benefit our own economy, but can and should contribute to our broader aid agenda of helping Africa tackle poverty and achieve its Millennium Development Goals.

In this period of greater engagement and investment, and despite the progress, Africa remains one of the poorest continents in the world.

One in eight African children dies before the age of five.

Four in ten Africans do not have access to clean drinking water.

Thirty per cent of people on the continent suffer from chronic hunger.

It is the region most off track in achieving the Millennium Development Goals, and as someone who has come to parliamentary politics in Australia from a career working for the United Nations, this is an area in which I am deeply interested and involved.

In the last ten years African governments received an estimated US$200 billion from oil revenue alone.

The extent to which these mining revenues can improve the lives of Africans depends heavily on the governance arrangements in place.

Where governance is weak, wealth in natural resources can be more of a curse than a blessing.

It can exacerbate conflict, human rights abuses and damage the environment.

For example, countries such as the Democratic Republic of Congo, Sudan and Congo-Brazzaville have experienced conflict in part because of their wealth in natural resources.

Australia is viewed in Africa as having a mature domestic mining sector with effective governance institutions and structures in place that manage the sector and the wealth it creates.

Foreign Minister Rudd outlined how Australia will assist African governments manage their mineral resources to his African Union counterparts last month.

Australia will focus on four areas.

They are:

  • improving African governments' ability to manage and regulate the use of their nation's natural wealth;
  • building resource sustainability by promoting environmental management and social responsibility in mining - which is critically important; indeed, the notion of an Australian standard of corporate social responsibility to which all Australian mining companies could subscribe and which would differentiate Australian business from others is one that I strongly encourage.
  • Australia will also enable resource development by building technical capacity in geosciences, surveying and exploration, occupational health and safety and mining operations;
  • And we will promote public-private partnerships that work with and share expertise from the mining industry as well as government, academia and civil society.

The work under these objectives will build on other mining-related activities pursued over the past few years.

For example in 2009, we supported a Southern Africa Development Community workshop on the sustainable use of mining revenues.

We are supporting the Australian mining industry organisation, AMIRA International, to build the teaching and research capacity in geosciences in a number of universities in West Africa.

We've provided $3 million to the International Monetary Fund's network of African Regional Technical Assistance Centres.

These centres build capacity for macroeconomic and financial management.

The program has allowed us, for example, to support the Ethiopian government to strengthen its mineral taxation policies.

We have provided 31 mining short-course awards to 16 African governments since 2008 to support improvements in the sustainable management of their mining sectors.

Another 60 mining fellowships will be awarded in 2011.

One in ten African students doing Masters degree courses in Australia in 2011 through the Australia Africa Awards scholarship program will be studying natural resource management.

Australian education is making a difference in Africa

On a broader scale, Australian education initiatives are making a real difference to Africa.

We are helping Africa give its young people the opportunity to meet their educational aspirations.

This year the number of Australia Africa Award scholarships will rise to 400, available in up to 40 African countries.

By 2013 we will offer 1000 of these awards every year to African students.

They will be joining thousands of African students who are here as private students- there were nearly 14 000 such enrolments last year.

It is about providing the opportunity to advance learning in the fields of agriculture and food security, public health and medicine, and of course energy and resource management- all areas of key importance to Africa.

It will complement the partnerships being built by businesses and universities with the goal of training the next generation of African business and mining professionals.

The Australian National University's Crawford School of Economics and Government, for example, is developing a series of postgraduate programs that it hopes to launch next year, targeted at African natural resource management students.

It will give private and scholarship students the opportunity to learn at one of the best public and economic policy schools in the Asia-Pacific.

It will continue a long tradition of giving Africa's future leaders and thinkers the chance to study at some of Australia's top universities. A growing number of Africans who occupy senior positions were trained in Australia, many of these through government scholarships.

These include the secretary of the cabinet of Gambia, the chief of trade and international negotiations section at the UN Economic Commission for Africa as well as the head of the African Development Bank in Malawi.

They and the students that will follow them through these new Australia Africa Award scholarships will be part of the transformation taking place in Africa.

Parliamentary Engagement on Africa

I would like to also mention the increased focus by the Australian parliament on Africa.

As many of you know, the Joint Standing Committee on Foreign Affairs Defence and Trade - of which I am a member - is presently conducting an Inquiry into Australia's relationship with the countries of Africa.

There will be a delegation to Africa by some committee members in April as part of the Inquiry. I know that some of the people and organisations in this room have made submissions to that inquiry and I want to thank you for presenting parliamentarians with a rich source of information and insight not only about what is happening in terms of Australia's relationship with Africa, but also about what is not happening and how we can and must improve.

Processes are also underway within the parliament to establish an Australia-Africa Parliamentary friendship group, which we hope will be the conduit for increased interaction between Australian parliamentarians and African parliamentarians, diplomats and others with an interest in Africa from across the spectrum of business, academia and civil society.

Australia has committed to look West

The Australian Government is serious about revitalising its relationship with Africa. We are committed to "look West" - and again, as a West Australian member of this government, can I tell you that looking west is my natural orientation.

The new Africa demands fresh engagement by Australia, and this government is resolutely walking that path.

Africa's progress has created further potential for positive change. That potential will need effort to make the change real. Australia will put in that effort.

We will be investing in Africa's future, through our business, through our diplomacy, through education, through development assistance and investment, and through vital people to people links.

We will be working in partnership with Australian businesses and academia, and with professional associations like the Australia-Africa Business Council which have much expertise, and energy and enthusiasm to contribute.

And taken all together this is a shared endeavour - an endeavour which is by turns financial, educational, cultural, diplomatic, and humanitarian - and one that will deliver benefits for Australia's future and increased economic development and growth to Africa, but is not undertaken on that basis alone; because these efforts we make together will also enhance this vitally important relationship between our continents.

Thank you.

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