G'Day USA and American Australian Association Economic Luncheon Address
Friends of Australia, friends of the United States. It is always great to be here in New York and thanks for the warm welcome! I understand it's going to be 12 inches of snow overnight and 50 mile an hour gusts are on the way! So we've chosen this day for the first G'Day USA event of 2016. This program is a celebration of the partnership between our countries, and a showcase of the truly remarkable possibilities that this partnership offers for the future.
Today I will talk about how Australia is continuing to embrace innovation at the heart of our economic policies as our economy transitions back from a focus on resource based investment to a broader based and more diverse economy. Innovation is the watchword. Particularly in times of market volatility, our outlook must be optimistic and it will be based on innovation.
One of the most persistent stereotypes of innovation is that of the lone genius – people like Steve Jobs or Mark Zuckerberg – the out-of-the-box thinker who single-handedly produces an astonishing breakthrough.
New York has more than its fair share of brilliant innovators. The epitome of the individual genius is Albert Einstein. Last year marked the 100th anniversary of Einstein's General Theory of Relativity – one of the most transformative breakthroughs of the modern world.
His wife tells a delightful story. Later she said, Albert became lost in thought one day during breakfast, and went up to his study and remained there for two weeks. When he came back downstairs a fortnight later, he was carrying two sheets of paper bearing the key features of his theory of Relativity.
In the face of such inspired genius what hope is there for us mere mortals?Well in fact, isolated individual breakthroughs are the exception, rather than the rule, when it comes to innovation.
Innovation and the digital economy
Innovation is most often a social endeavour, which depends on strong relationships to flourish. Networks create supportive environments for multiple individual inspiration and creativity.
We think of it in terms of "pockets" of innovation, which emphasise the importance that our government attaches to building and supporting enabling partnerships.
Pockets of innovation start with people who are open to new ideas, people who aren't afraid to challenge the status quo, people who like to create and test new ideas, and support others to do the same.
Over time, such pockets grow and develop as they attract more people, and investment, and ideas, and connections, enabling technologies and business opportunities.
Today, we find the ultimate expression of what a pocket of innovation can become in Silicon Valley. The culture of innovation and zest for disruption nurtured there is admired, and envied, around the world.
So thanks to the explosive impact of Silicon Valley and other American success stories, we are now witnessing a global entrepreneurial renaissance. It has never been easier or cheaper – relatively speaking – to take an idea, to start a business and to sell it to the world. There is an unprecedented appetite for start-ups, for new thinking and creative disruption.
Innovation is springing up everywhere: inside schools, universities, incubators, start-up accelerators, companies, communities and yes, even governments.
Here in New York, you have successfully created your own Silicon Alley, with its very own batch of upcoming "unicorns" – the tech start-ups valued at more than $1 billion – and of breakthrough technologies.
In Australia, we are encouraging home-grown start-ups and entrepreneurial hubs. An Australian business Atlassian is making its mark with one of the globe's largest technology IPOs in 2015.
On a different scale, Australian start-ups like Freelancer, Canva, Nitro and others offer further evidence of our world-class talent and creativity and they are now expanding their businesses into the United States.
The digital economy offers opportunities that transcend location. For a geographically isolated country like Australia, technology is breaking down the tyranny of distance.
Our ingenuity, resourcefulness and creativity have long been recognised as an essential part of our national character. Last year, the Martin Prosperity Institute at the University of Toronto judged Australia to be the most creative nation on earth.
For much of our early history, inventiveness was borne out of necessity. We were pretty much on our own!
It's our creativity that supports strong economic fundamentals.
We have a dynamic and resilient economy. We have an impressive 24 years of uninterrupted annual economic growth.
Our economy has been dominated by the mining sector in recent years, however the development of a more diversified, innovative and services-driven economy has been underway for decades.
Education, tourism, healthcare, banking, financial and other services exports are already very competitive in global markets.
We have driven an ambitious agenda for regional economic liberalisation through our commitment to the Trans-Pacific Partnership agreement. This landmark trade deal among 12 member countries will establish a more seamless trade and investment environment across the region, driving our future prosperity, particularly in services.
With Australia's enthusiastic embrace of the digital age, a new wave of innovation-driven growth beckons.
We are unleashing the full potential of our entrepreneurs and our high value-added creative industries onto the global market.
There truly has never been a better time to be an innovative Australian business, or to do business with Australia.
Innovation and economic diplomacy
When I became Foreign Minister a couple of years ago, I asked the Department of Foreign Affairs and Trade to ensure our diplomatic assets were used specifically to improve our international competiveness and the reach of Australian businesses into the global market.
For the first time our diplomatic posts were required to develop the equivalent of a corporate business plan to support and promote Australian business abroad. Each and every one of our 100 diplomatic posts.
We've had some significant wins on this front. For a start, there have been some remarkable successes throughout the G'Day USA program. I do want to take this opportunity to thank the American Australian Association, Citi and the Commonwealth Bank of Australia for sponsoring this lunch.
Now, under the over $1 billion National Innovation and Science Agenda launched by Prime Minister Malcolm Turnbull in December, it's time for a new phase of what I call Australia's "economic diplomacy".
Australian diplomats are on the ground in economic hotspots around the world, actively identifying, supporting and plugging into pools of investment potential. And I take this so seriously that I sent here to New York as our Consul General, our former Finance Minister and Leader of The Senate, Nick Minchin, an outstanding practitioner of "economic diplomacy"! I'll give you his direct mobile number later! I'll also take this opportunity to acknowledge Gillian Bird our Ambassador to the United Nations based here in New York who also has her fair share of diplomatic challenges.
Australian businesses are being connected to investment opportunities. They're joining networks, building new relationships, creating new value and maximising gains.
A great example of this approach is our new partnership with Israel on science and technology cooperation.
A central feature of the partnership is a "landing pad" in Tel Aviv to help ambitious Australian entrepreneurs tap into Israel's innovation ecosystem. This will be one of five landing pads created around the world, as part of Australia's Global Innovation Strategy.
We'll also continue to encourage and assist Australian businesses to expand links with Israeli innovators. I was delighted to see that the Commonwealth Bank – not only as a presenting sponsor of this event – signed a joint R&D agreement with the Israeli Office of the Chief Scientist in November last year. The first foreign bank to do so, congratulations.
Innovation in the aid program
Innovation is not only driving Australian prosperity, it's driving the global economy. Disruptive changes driven by technology are prompting many countries to re-evaluate their economic frameworks.
New sources of finance – and new thinking – even about centuries-old industries – are helping reshape societies all around the world.
One example that caught my attention was an Aussie start-up FlowHive. It makes harvesting honey from a beehive as simple as turning on a tap at the back of the hive then collecting the honey as it pours out.
A father-and-son team of Stuart and Cedar Anderson put their Byron Bay backyard invention on crowd funding website "Indiegogo" in February 2015, only to hit their funding target within three minutes. By the end of their eight-week campaign they had sold about 26,000 beehives, raising over US$12 million and setting a new Indiegogo fundraising record.
They now receive $30,000 worth of orders per day and the innovative beehive design has been described as "the greatest step forward for bee keeping in 150 years." Who knew?
New approaches are transforming some economies that have struggled for literally decades with deeply entrenched development challenges.
The private sector has a key role to play.
Within our foreign aid program I've established an innovation lab, the "innovationXchange", to help pioneer new approaches to the delivery of development assistance, particularly in our region the South Pacific.
It is an oasis of innovation and free thinking within our bureaucracy. The innovationXchange encourages our people within government to take risks, to be ambitious in trialling new ideas, to work with and join with the private sector and to aim for positive, transformative change in the countries where we work, and to acknowledge that before success there can be failure.
This represents a fundamental change of mindset within our public service and other departments are now seeking to establish similar innovation hubs.
For example, the innovationXchange is leading an initiative that we've called "Seed Pacific" to partner with large businesses and civil society in a joint effort to solve seemingly intractable development problems in the South Pacific.
Foreign aid is no longer the sole domain of governments. We've also partnered with Bloomberg Philanthropies to re-write the public health policies of about 20 developing countries by using the latest mobile devices to collect data on such vital statistics as births, deaths, cause of death, and these statistics, can you believe, were not previously collected and analysed. So this is a real-time census that will, for the first time, actually inform health outcomes.
In fact, Michael Bloomberg is on our advisory board for the innovationXchange and we are deeply grateful for his personal involvement. He went so far as chairing and hosting a meeting of the innovationXchange here in New York last year.
Foreign aid that stimulates economic growth is the best pathway to sustainably reduce poverty.
Seed Pacific and the Bloomberg joint venture are examples of how thinking within our government has shifted.
Mind you, Australia has form when it comes to great ideas and their implementation.
Google Maps is based on mapping technology built by a Sydney-based start-up, Where2.
Australian engineers are at the forefront of the emerging quantum computing revolution. Super-powerful quantum computers will solve problems in minutes that would take conventional computers centuries.
The first FAA-approved drone delivery on US soil was undertaken by an Australian start-up, Flirtey. Drones ferried 24 packages of pharmaceuticals from an airport to a medical clinic in Virginia. And look at the use of drones today.
Ford's new Shelby Mustang is using carbon-fibre wheels created by an Australian advanced manufacturing company Carbon Revolution, and this cutting-edge design will deliver a 50% weight saving over aluminium designs.
Carnegie Wave Energy in my home town of Perth has developed wave energy technology that converts ocean swell into zero-emission renewable power and desalinated freshwater. These are just a few examples of what Aussie innovation can do.
Ladies and gentlemen, innovation is built on partnerships. It lives and dies in the relationships we form, and the values we share.
The partnership between the United States and Australia is a powerful force for innovation, for economic growth, and for global good.
It's a union between like-minded actors, sharing a commitment to the power of free markets and enterprise and a belief in the transformative innovation they enable.
New partnerships between businesses, researchers, and investors, new networks for our entrepreneurs, creative workers and diplomats, joining in path-breaking initiatives in developing countries.
Australia and the United States can do so much more together, creating, supporting and extending innovation across the full spectrum of our shared interests.
There are so many examples of where the United States and Australia are building the partnerships for future success.
Innovation is the key to overcoming current challenges and promoting economic prosperity.
We will continue to look to the United States for ideas and inspiration and new thinking.
Indeed it was Albert Einstein who said, "we cannot solve our problems with the same thinking we used when we created them."
And we want you, in turn, to look to and invest in our people in Australia - their ideas and ingenuity - for they are among the very best in the world.