The Treasury will continue to balance opportunities and risks in relation to trade and investment flows through our understanding of Australia’s place in an increasingly complex global economic context. The global rise of protectionist sentiment highlights the fragility of the global consensus on the importance of economic openness and the need for continuing advocacy for the free flow of trade and movement of goods, exchange of services and investment flows.
The Treasury’s program of international engagement is central in building capacity in Australia’s region, assisting in monitoring international developments and promoting regional and global macroeconomic stability. Treasury staff are posted globally in key economic regions to inform our work and engage with stakeholders including the Organisation for Economic Co-operation and Development (OECD) and the Asia-Pacific Economic Cooperation (APEC).
The Treasury provides forecasts and advice on global economic and trade conditions, with a focus on Australia’s major trading partners and issues of direct relevance for the Australian economy — such as commodity prices, inflation, monetary and fiscal policy trends, financial market developments and demographic changes.
The Treasury also closely monitors the external environment for potential opportunities — this is especially significant as Australia’s major trading partners are forecast to grow faster than the wider global economy. Equally important is being alive to the risks and changes in the global outlook and how these may affect the domestic outlook. Of particular significance for Australia are the implications of potential risks to China’s economy including high levels of debt, potential financial imbalances and overcapacity in some sectors.
Planned activities
- Give effect to Australia’s commitment to effective multilateralism, including through the International Monetary Fund (IMF), Multilateral-Development Banks (MDBs) and multilateral fora.
- Support the effective operation of the global financial safety net, including by advocating for: closer cooperation between the IMF and regional financing arrangements; the continued evolution of the IMF’s lending toolkit; and reform to IMF quotas and governance to ensure the IMF remains credible and effective.
- Encourage MDBs to make the most effective use of their resource base, acting as a catalyst for additional private sector investment and optimising their use of capital.
- Support the efforts of the Asian Infrastructure Investment Bank to sharpen its strategic focus and build its capacity in areas of desired comparative advantage.
- Engage in effective advocacy at meetings of the Group of Twenty, APEC, and other multilateral fora to ensure they support growth, macroeconomic and financial stability and economic development.
- Deepen bilateral engagement with key strategic partners in the Asia-Pacific region to support increased regional growth and stability; including greater focus on our analysis of emerging economies.
- Advocate the importance of Australia and the region’s openness to international trade.
- Promoting the efficiency of Australian markets to support our industries to be competitive overseas.
Measures
Meeting objectives through Australia’s membership of the international financial institutions. Measured by Australia meeting its financial and other obligations to these organisations; and through the Treasury’s ability to influence policy and our reputation for integrity.
Deepening relationships with key strategic partners in the Asia-Pacific region. Measured by enhanced mutual understanding between Australia and its regional partners, including strengthening shared influence on collective agendas, during the direct engagements and dialogues we undertake.
The Treasury’s advocacy and liaison on Australia’s economic and trade interests contributes positively to bilateral, regional and multilateral outcomes that help ensure the prosperity of Australia.