Asia will power Australian economy into top 10, says Gillard

PUBLISHED : Monday, 29 October, 2012, 12:00am
UPDATED : Monday, 29 October, 2012, 3:55am

An ambitious plan aimed at maximising links with booming China and other soaring Asian economies will push Australia into the world's top 10 wealthiest nations by 2025, the government says.

The sweeping policy blueprint, titled "Australia in the Asian Century", sets a series of goals for the next 13 years to seize upon Asia's rapid ascent as a global economic powerhouse led by the modernisation of China and India.

"The scale and pace of Asia's rise is staggering, and there are significant opportunities and challenges for all Australians," Prime Minister Julia Gillard said.

"It is not enough to rely on luck - our future will be determined by the choices we make and how we engage with the region we live in."

By 2025, Gillard said, Australia's GDP per person - a measure of personal wealth - would jump into the world's top 10, joining the likes of Qatar, Singapore, Hong Kong, Brunei, the United Arab Emirates and the United States.

It is now ranked 13th according to the International Monetary Fund, which calculates the gauge by dividing goods and services produced by a country by its population and adjusting for relative cost of living and inflation.

Australia dodged recession during the financial crisis due to its links to Asia, but the mining-powered economy slashed its growth and surplus forecasts last week as China's slowdown hits commodity prices.

Gillard said her vision was for Australia to "stand strongly as a mature and confident power" in the region, supporting greater participation by China and other Asian powers in decision-making while remaining a key US ally.

"We are supporting the stabilising presence of the US, a strong defence force, building habits of trust and co-operation in our region and a rules-based regional order," she said.

China, India, Indonesia, Japan, South Korea and the US would be Australia's key partners, and the rise of Asia's middle classes would bring opportunities in industries from health and elderly care to food and travel.

One-third of Australia's economy would be underpinned by trade with Asia, up from one-quarter today, and it would be one of the world's top five countries to do business in, she said.

Education and business were key areas for goal-setting - by 2025, Gillard said, and Australia's school system would be in the top five.