Australian Prime Minister Kevin Rudd yesterday said the China resources boom was over, leaving the economy at a crossroads, as he called for a new productivity pact to boost competitiveness.
In his first major policy speech since ousting former Australian prime minister Julia Gillard as leader, Rudd also urged a sharper engagement with Asia, particularly Indonesia, to help smooth the nation’s economic transition from its reliance on commodities.
“If we make the wrong decisions now, we will be living with those decisions for the decade ahead,” he said. “The truth is, in 2013, the China resources boom is over. While the export of resource and commodity volumes are up, the prices we receive for them have now fallen almost 25 percent since their peak and may well fall further. Right now, we find ourselves at a crossover point for our national economy.”
Photo: Bloomberg
Rudd’s comments came as Australia’s jobless rate jumped to 5.7 percent last month, its highest level in almost four years, as the mining-driven economy begins a tough diversification drive to other sources of growth.
The economy grew at a slower-than-expected rate in the first three months of the year, expanding 0.6 percent on quarter and 2.5 percent on year suggesting the decade-long mining investment boom was unwinding
“Managing this economic transition is now a core task of Australian economic policy,” Rudd said. “Critical for jobs. Critical for infrastructure.”
He said lifting national productivity was a key priority, calling for better cooperation between business, unions and government so everyone was “pushing in the same strategic policy direction.”
“The core of this new national competitiveness agenda must be a common agreement to lift the rate of annual productivity growth from its existing level of 1.6 percent to 2 percent or better,” he said.
Since becoming prime minister a fortnight ago, Rudd has met four times with the Australian Council of Trade Unions and the Business Council of Australia to enlist their support for closer cooperation.
Agenda items included rising energy prices, rigidities in the labor market, business productivity, red tape, education, skills and training, infrastructure and small business.
Rudd said greater business engagement with Asia outside of the resources and energy sector was also necessary to help the economy cope.
“The truth is Australia is much underdone in Asia beyond the resource and energy sector,” he said.
“Indonesia is a classic example — an economy which by 2050 is on track to become the fourth-largest economy in the world after China, India and the US,” he said.
However, at present, Indonesia does not fall within our top 10 trading partners or our top 20 investment destinations.”
Rudd had invited conservative opposition leader Tony Abbott to join him at the National Press Club, where he made his speech, to debate the economic future of Australia, but Abbot declined.
The prime minister said Abbott was scared of “the public scrutiny of an economic policy debate” and branded him “Captain Negative,” suggesting he routinely talked down the economy.
Abbott, who remains the narrow favorite to win national elections later this year, responded by accusing Rudd of being all talk and no concrete policy.
“Unfortunately, Mr Rudd has no specific announcements to make. All he can talk about is process, not change,” he said of his opponent’s speech.
“He had a plan to destroy a prime minister but doesn’t have a plan for the country,” he added, referring to Rudd’s unseating of Gillard in a Labor Party coup last month.
SEEKING CHANGE: A hospital worker said she did not vote in previous elections, but ‘now I can see that maybe my vote can change the system and the country’ Voting closed yesterday across the Solomon Islands in the south Pacific nation’s first general election since the government switched diplomatic allegiance from Taiwan to Beijing and struck a secret security pact that has raised fears of the Chinese navy gaining a foothold in the region. The Solomon Islands’ closer relationship with China and a troubled domestic economy weighed on voters’ minds as they cast their ballots. As many as 420,000 registered voters had their say across 50 national seats. For the first time, the national vote also coincided with elections for eight of the 10 local governments. Esther Maeluma cast her vote in the
Nearly half of China’s major cities are suffering “moderate to severe” levels of subsidence, putting millions of people at risk of flooding, especially as sea levels rise, according to a study of nationwide satellite data released yesterday. The authors of the paper, published by the journal Science, found that 45 percent of China’s urban land was sinking faster than 3mm per year, with 16 percent at more than 10mm per year, driven not only by declining water tables, but also the sheer weight of the built environment. With China’s urban population already in excess of 900 million people, “even a small portion
UNSETTLING IMAGES: The scene took place in front of TV crews covering the Trump trial, with a CNN anchor calling it an ‘emotional and unbelievably disturbing moment’ A man who doused himself in an accelerant and set himself on fire outside the courthouse where former US president Donald Trump is on trial has died, police said yesterday. The New York City Police Department (NYPD) said the man was declared dead by staff at an area hospital. The man was in Collect Pond Park at about 1:30pm on Friday when he took out pamphlets espousing conspiracy theories, tossed them around, then doused himself in an accelerant and set himself on fire, officials and witnesses said. A large number of police officers were nearby when it happened. Some officers and bystanders rushed
HYPOCRISY? The Chinese Ministry of Foreign Affairs yesterday asked whether Biden was talking about China or the US when he used the word ‘xenophobic’ US President Joe Biden on Wednesday called for a hike in steel tariffs on China, accusing Beijing of cheating as he spoke at a campaign event in Pennsylvania. Biden accused China of xenophobia, too, in a speech to union members in Pittsburgh. “They’re not competing, they’re cheating. They’re cheating and we’ve seen the damage here in America,” Biden said. Chinese steel companies “don’t need to worry about making a profit because the Chinese government is subsidizing them so heavily,” he said. Biden said he had called for the US Trade Representative to triple the tariff rates for Chinese steel and aluminum if Beijing was