Australia’s G20 presidency to focus on fundamentals and deliver practical outcomes
Speaking at the World Economic Forum in Davos overnight, Australian Prime Minister the Hon. Tony Abbott MP outlined Australia’s approach to its G20 presidency in 2014. Prime Minister Abbott said the challenge ahead, as governments work through the weaknesses that brought on the global financial crisis, is to strengthen governance without suppressing the vitality of capitalism.
Referring to the commitments made by G20 leaders last year to develop comprehensive national growth strategies, the Prime Minister urged leaders to focus on identifying practical actions they could take to improve growth and employment outcomes.
Mr Abbott said this year’s Brisbane Summit will focus on a few key subjects because progress usually comes one step at a time.
Trade is high on the Australian agenda as is infrastructure investment.
Mr Abbott called on each country to commit to open up trade through unilateral, bi-lateral, plurilateral and multi-lateral actions as well as through domestic reforms to help businesses engage more fully in global commerce.
“As an infrastructure Prime Minister”, Mr Abbott said his hope as G20 host is to bring policy-makers, financiers and builders together to identify practical ways of increasing long-term infrastructure financing to address the infrastructure deficit in developing and developed countries alike. The OECD estimates that $50 trillion of infrastructure investment is required globally by 2030. Mr Abbott underlined that what investors need is greater confidence that governments won’t change the rules after the investment has been made.
Tax is another issue the G20 will continue to tackle. The objective is to avoid businesses artificially generating profits to chase tax opportunities rather than market ones. The essential principle is that you should normally pay tax in the country where you’ve earned the revenue.
The Prime Minister said Australia, as G20 host, will also seek to finalise G20 reforms already underway within the financial sector aimed at building global economic resilience to minimise future shocks.
On trade, tax, infrastructure, employment and banking, the Prime Minister emphasised that governments owe it to their citizens to maximise the specific outcomes from this year’s G20, adding “After all, government doesn’t create wealth; people do, when they run profitable businesses”.