David Coleman (Banks, Liberal Party) Share this | Link to this | Hansard source

My question is to the Prime Minister. Will the Prime Minister update the House on the importance of productivity, growth and innovation in maintaining a high-wage, First World, fair, social welfare safety net economy? How will policies to encourage greater innovation and more rapid productivity growth help Australia transition to a post mining boom economy?

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

I thank the honourable member for his question. I note his keen interest in innovation and economic growth. As a former experienced businessman in the media industry, he understands how disruptive technologies are changing the economic landscape, how they offer challenges to establish businesses and established ways of working but contain within them enormous opportunities.

The key to our future success—our future prosperity—is innovation and productivity driving competitiveness. This is a time when the opportunities for Australians have never been greater. The global economy is expanding at an extraordinary rate. We now have more than half of the world's middle-class consumers in our region, and it will not be long before that is the overwhelming majority. China, a country which had barely participated in the global economy 40 years ago is now, by many measures, the world's largest, single national economy. Its online trade and commerce is larger than that of the United States. The changes in our region are enormous, and we are able to take advantage of them.

We see in yesterday's national accounts real cause for optimism and confidence that we are heading in the right direction. The Australian economy grew by 0.9 per cent in the quarter and 2½ per cent throughout the year. As the Commonwealth Bank noted, positive GDP growth and employment incomes indicate that the non-mining economy is more than offsetting the decline in mining activity.

That decline is not because mining is going out of date or out of fashion; it was inevitable. There was a massive increase in demand for commodities driven out of the China boom, particularly out of China's stimulus at the time of the GFC. That, of course, was not able to be met by an instantaneous supply response, so prices went up and investment followed—a massive construction boom. Now you are starting to see much bigger volumes but, obviously, lower prices. To have that massive shift in the terms of trade while maintaining strong economic growth and strong employment growth is a tribute to the flexibility and the agility of our economy.

I should note that at the core of that is trade. We have negotiated free trade agreements with major trading partners this year. The architect of those agreements is the trade minister, Andrew Robb, and I note that he has been nominated as the international policymaker of the year by PublicAffairsAsia for his efforts.

Government members: Hear, hear!

An outstanding achievement by our minister for trade—driving jobs, driving growth, securing prosperity.