 Good morning ladies and gentlemen it's always a pleasure to be at ANU, this is the Australian Government's University and I believe it plays a vital role in the development of public policy and so it's a pleasure to be invited to address this forum which in only four years has emerged as an important arena in which to discuss some of the major challenges facing our country, facing our region and globally and to foster ideas that can inform the development of public policy. I looked at the topic today and decided that as opening speaker I'll seek to set the scene for some of your deliberations. Government doesn't have all the answers, some would suggest government doesn't have any of the answers so allow me throughout my address to pose a few questions for you and questions that I hope you will be considering today and we'll be able to provide responses to us because I take this forum very seriously in terms of what you'll be able to deliver. We live in an era of great disruption. History tells us that this brings many challenges and opportunities. Those who develop public policy will continue to be tested in coming years as the pace of change gathers momentum. Now I see the community as somewhat divided between those who view the world as glass half full or those who view it as half empty. Those who are fearful of the impact of change or those who embrace it and this applies to many of our current policy drivers and we're continually hearing from those who are endlessly pessimistic about say China's economic growth while others remain consistently optimistic. We hear from those who say robots will take our jobs or others who say robots are going to be an indispensable part of our lives by relieving us from tasks of drudgery. So here's my first question confronted with an uncertain international strategic environment and waves of disruptive technological change. What must Australia do to maintain economic growth and continue as a top performing global economy? Let me give you some context. As the world's 13th largest economy and in our 26th consecutive year of economic growth I found it somewhat confronting to read Pricewaterhouse Cooper's report published earlier this year that argues Australia will be lucky to be among the top 30 economies by 2050 will be lucky to be in the top 30 economies by 2050 that would place us nominally outside the G20. Of course such reports provide a timely reminder that governments and policy makers need to be more creative and innovative in policy approaches to ensure that this isn't a self-fulfilling policy prophecy. So what must be our response? We are living in an era of profound change arguably more profound than in earlier phases of the industrial revolution. The nature scope and pace of change at this time is unprecedented in human history. Many are calling it the fourth industrial revolution driving disruption across a wide range of industries and transforming how goods are produced, how services are delivered from banking to healthcare, from professional services to the government sector. It's changing the very nature of businesses and how we live and work and interact and even in the arcane world of foreign affairs I'm as likely to text my counterpart or tweet a foreign policy as I am to read a cable or hold a press conference to announce a change in public policy. So what will be the impact on Australia of this fourth industrial revolution and this is going to be my focus today. A recent Deloitte's access economics report summarised the current digital technologies powering this disruption. Artificial intelligence and machine learning, 3D printing and additive manufacturing, blockchains and distributed ledges, genomics, the internet of things, robotics, drones, virtual and augmented reality and wearable technology. We've certainly seen enough technological change over the past 25 years to know that change will arrive even faster in the next 25 years. For example, automation. Is Australia even thinking about the impact of what could be one of the greatest disruptive technologies in automation? Many are forecasting that electric driverless cars will be commonplace on our road within a few years. Uber to the max. Like all new developments there are skeptics however if we assume this technology will be perfected this could have a huge impact throughout the transport sector and beyond. Just think of the urban environment. It could challenge the need for vehicle ownership thus impacting on motor vehicle sales. Uber will struggle to compete let alone taxis. Roads dominated by networked electric cars will see far fewer accidents reducing the need for insurance, panel beating, motor vehicle repairs, traffic control systems will no longer be needed, law enforcement will be reduced. It goes on and on. Just one technological advance. One developer of self-driving vehicles predicts the learning curve for software would be exponential. As every lesson learned by every individual motor vehicle would then be networked immediately to all other vehicles and it would be akin to humans telepathically passing on information about road conditions and the surrounding environment. Automation extends beyond the services sector. I was in New York the other week and I met with Michael Bloomberg. He sits on the International Advisory Committee of the Innovation Exchange which I've set up within the Department of Foreign Affairs and Trade and Innovation Hub. At the headquarters of Bloomberg Media he showed me that with one or maybe two clicks on a computer screen up pops a comprehensive summary of the performance of any particular stock. It contains a detailed analysis of its profit and loss over recent years, the returns on investment in terms of dividends and its stock market valuations, a very detailed analysis. Very impressive research, yet the article was generated entirely by software. There was no human input at all with real-time updates whenever that stock was accessed. Bloomberg has employed thousands of stock analysts over the years and this suggests that that traditional analyst role is disappearing. So the future is certainly exciting. The arrival of advanced robotics, artificial intelligence, mobile technologies and biotechnology is a celebration of human ingenuity and has exponentially improved our quality of life. Technology is impacting on geopolitics enabled by globalization. Some countries have surged forward and are taking on new leadership roles, economic, military, political and social. We're witnessing a relative shift in economic power. China has moved from being the seventh largest economy in the world in the 1970s to the second largest today or possibly the largest by purchasing power. India has jumped from ninth to seventh currently and is moving up the ladder rapidly. Indonesia is predicted to be in the top five economies in coming decades. Economic power is shifting from west to east and even in these countries whose competitive advantage has been low-cost labor, advanced robotics and other technologies are further driving down the cost of production. Huge sums are being invested in advanced manufacturing and robotics. The Taiwanese company Foxconn, the world's largest contract electronics maker, estimates that by 2020 around one third of its production will be performed by robots and while many jobs in manufacturing assembly can be highly repetitive, what will be available for low-skilled workers? Countries that led the race into industrialization including the UK, France and the United States have continued to evolve developing strong services sectors as traditional manufacturing has shrunk. That said, technological change together with the increased competition for capital, access to markets and labor that economic independence has produced has created uncertainty in many advanced economies. So how do governments respond to the impact of these profound changes on individual human lives in addition to the overall benefits to society? And the question we have to struggle with is is the Australian economy sufficiently agile and adaptable? Now this challenge isn't entirely new for Australia, it's useful to look back at our economic responsiveness over the last century. Australia has transitioned from an economy dependent on agricultural produce and manufactured goods to one where less than 3% of Australians work the land and only 7% work in manufacturing. The change has transformed the nature of work in Australia and at the same time has created an era of unprecedented prosperity. Millions of highway jobs including in the services sector where four out of five Australians now work have been created. In 2017 half a million more people are employed in construction in Australia than there were 25 years ago from 518,000 people to more than 1.1 million today. More than 400,000 jobs have been created in education and training, more than 600,000 new professional scientific and technical positions have been created in the last 25 years and perhaps the biggest change of all has come in healthcare and social assistance where more than 830,000 new jobs have been created. Whereas manufacturing was Australia's only 1 million plus employer in 1992, 25 years later we have four industry categories employing more than 1 million people each. On the back of an historic mining boom with an economic and political system, the envy of almost every country in the world we have emerged as a major economy even though we have a small population by global standards. So as we do enter this 26 consecutive year of continuous economic growth it's sobering to recall that we now have a whole generation of Australians who have never known a recession. This success of course is built on our embrace of liberal democratic institutions, open trade, a willingness to reform, to remain competitive and adapt our response to technological, economic and geostrategic changes but none of this can be taken for granted. Now we know that technological revolutions are relentless, whether these phenomena develop into opportunities or threats to our economy and society and whether these developments support or hinder future prosperity depends entirely on how we respond. As an open export oriented market economy Australia's prosperity has been enhanced through globalisation and economic interdependence and by the critically important free trade agreements removing barriers to facilitate trade and investment. How do we protect free trade and foreign investment in the face of growing protectionist sentiment with the smallest population of any current G20 economy and the third highest per capita GDP after the United States and Saudi Arabia in this grouping. This means we cannot become richer simply by selling goods and services to ourselves. We have a small population and are already a high consumption economy and society relative to our size. Now Australia has signed 13 free trade agreements, we're negotiating another six, we've launched free trade negotiations with Hong Kong and Peru in recent times, we're pursuing free trade agreements with the EU and with the UK. Independent modelling has found that these FDA's will boost our GDP by 25 billion over the next two decades, that equates to each household being $4,000 better off. Our resilience has been based on significant foreign direct investment in the face of growing economic nationalism in parts of our country, in our region and around the world, what policy settings will make us more competitive and attractive to investors. And then coming down to that fundamental question, what are the jobs of the future? By some forecast 65% of today's school children will work in industries and sectors yet to be created. In order to maintain a competitive economy we need to be nimble and identify and grasp opportunities. And this is why the Prime Minister announced the $1.1 billion national innovation and science agenda to offer incentives for start-up companies operating in cutting-edge industries or utilising advanced technologies. We want to create a supportive environment for start-ups and early stage capital funding, both at home and in our region. And that's why I've placed innovation at the heart of policy making in my portfolio, which is helping address some of these challenges. Last month I announced a partnership between DFAT's Innovation Exchange and Massachusetts Institute of Technology, MIT and its SOLVE initiative and the Australian software company Atlassian to help nations and their young people from the Indo-Pacific region prepare for the workforce of the future. So Australia's contributing $1.4 million to the MIT-led SOLVE Global Challenge. It's called Youth and the Workforce of the Future, which will crowdsource expertise and innovative ideas from around the globe to help prepare communities and governments for the future of work. The most promising ideas will be awarded pilot funding and the opportunity to be scaled up for application in our region. And this partnership will help apply the science, the engineering, the technology and innovation capabilities of MIT and Atlassian to the challenges faced by governments and young people in the Indo-Pacific region as a result of technological change. The Australian government is also engaging with countries and companies at the forefront of the technology revolution and this will be crucial. Let me take Boeing for example. Australia is Boeing's largest base outside the United States. Boeing is engaged in a wide variety of sectors from the manufacturing of complex airplane components to supply change management and defence platform support. The multiplier effect of such investments is enormous. In 2015 alone, Boeing spent about $400 million with more than a thousand Australian suppliers. In 2016, Boeing committed to investing a billion dollars in Australia, creating opportunities for engineering and machining companies to diversify and win new markets in the international aerospace market. We're also leveraging research partnerships working with CSIRO and 10 local universities. Boeing's R&D investment in Australia has helped us become a world leader in developing new aviation products. Creating the right conditions for collaboration, ideas sharing and the free flow of capital, goods and services all critical to continued economic growth and international influence. And there are also lessons that we need to share with other nations as they seek their development path. We can share our experience in the hope of influencing those who seek sustainable and enduring economic growth. So to maintain Australia's place among the G20 leading global economies, the government is putting in place a number of policies to drive investment and innovation, reduce the tax burden on investment and enterprise, open up our enterprises to new markets through more new export trade deals, develop infrastructure that underpins investment, enhances productivity and removes the impediments to that investment. Openness, flexibility and preparedness to adapt. These are the ingredients to maintaining Australia's social and economic influence in the decades ahead, but what more must be done. In terms of our international engagement, I've commissioned a foreign policy white paper to be published later this year and the task I've asked of you today to answer the hard questions is not dissimilar to the task set for the white paper. We can't predict the future, but there will be inevitable disruptions through technology, through conflict, crisis and relative shifts in economic and military power. Our challenge is to identify how we can best protect and promote Australia's values and interests and priorities in the next decade. I hope that white papers will become a regular feature each decade in Australian public policy development, including a consideration of the structures that have benefited Australia, the international rules-based order that is under challenge from many quarters of free markets and open economies where protectionist and nationalist sentiment is creeping into our thinking. None of this can be taken for granted and Australia must ensure its standing and influence is leveraged to our advantage. So as a glass half full person, I look forward to hearing of your positive deliberations today and look forward to you answering the questions that governments are struggling to respond to. Thank you. Foreign Minister has cabinet commitments which are going to require her to be out the door at 9.45 sharp, but we do have nearly 10 minutes for some Q&A comments backwards and forwards. So over to you. Chubby, where are you? You had something to say this morning on the utility of some of these government strategies for innovation. Where are you? Would you like to raise that point? Can't see him. Disappeared. He's disappeared after all that. Come on. This is supposed to be interactive opportunity for engagement. Yeah, Gordon Plake from West Australia. I was struck by your reference to the PWC report and the concern not only of the rise of the region or the opportunities there but also of Australia's potentially declining role. I realize this is not your direct purview, but I wonder if you might address the broader question of immigration. If you start looking out at 2050 like the PWC report, because obviously innovation and economic form can take you so far, but ultimately the thing that's driving much of the region leapfrogging ahead of Australia is the growth of their own demographic trends. Most certainly we have a demographic challenge in that ours is an aging population, not aging as quickly as say China's which is facing a significant demographic challenge, but the free flow of people is of course fundamental to economic success and that's why we need to continue to encourage skilled workers, those who have a lot to contribute to Australia's economic success to come to this country. I suggest the most successful multicultural nation on earth. We have embraced people from all over the globe and that has been to our undoubted benefit and we must continue to do that. As the growing economic and protectionist sentiment creeps into discussions in our country, in our region, around the globe, we must not fall to the growing sentiment of closing one's doors and I believe that Australia must continue to attract the best people as well as capital and trade and investment into this country. It's fundamental. It's been one of the drivers of success in this economy, so immigration policy must be finally tuned to coordinate economic and foreign policy. I was just wondering if you need a second here. Well I'm hoping that everybody in this room has made a submission to the foreign policy white paper and they've all been taken on exceedingly seriously. I'm hoping that we'll be delivering the paper later this year and I have to say the feedback that we've had has been extraordinary. We've held public consultations across Australia and capital cities in regional areas. We've spoken at length with nations in our region and beyond. We've spent a lot of time talking with business and so I think that without giving sneak previews I think that you'll see the most comprehensive analysis of Australia's place in the world, our values, our interests and our priorities that we've seen for some time and what I hope for this white paper is that it is dynamic, that it continues to inform, that it continues to drive our policy directions and engagement rather than as has been the case with a number of white policies in the past put in the bottom drawer and then gather dust. I really hope that this does become a living breathing document that drives our engagement given the pace of change and disruption that we face. Mr Bishop you spoke about free trade agreements. One of the problems with so many individual free trade agreements is that they don't actually promote multilateral free trade. How do you see us getting back into on the international agenda free trade as a multilateral arrangement? We need some successes in multilateral free trade agreements and while there has been the Doha round stored to the point where it's on life support that's why we then actively pursued bilateral free trade agreements because we couldn't stand still and we've also pursued regional free trade agreements so while I've mentioned a number of the bilateral agreements say the United States, China, Korea, Japan significant bilateral free trade agreements we're also pursuing regional. We concluded the PASA plus which is a more modest agreement but within our region the South Pacific countries coming to terms with the idea of open economies and free markets. We are still part of TPP11 and they are the 11 countries continuing the Trans-Pacific Partnership Spirit and Ideals and much of that is being driven by Japan which I think is an Australia which is a very positive sign and we hope that the TPP11 in some form will morph into a regional free trade agreement. Asset the regional comprehensive economic partnership which is around the ASEAN countries with China, Japan and Australia is also progressing a free trade agreement with the EU. The EU is one of our largest trading blocks is also on the cards. I'm hoping that formal negotiations will be announced this year. So if one takes all these regional agreements then there is the opportunity for them to become part of a broader multi lateral outcome. That's what we had been hoping with the TPP. If you had TPP on one hand, ASAP on the other hand, you then start to get that Asia Pacific free trade agreement that APEC was all about. So we are very determined to continue to advocate for regional free trade agreements that have the potential to drive multi lateral agreements. Just one last question from Toby. One of the greatest challenges we have in this country and actually in post-Soviet care in the US is how are we going to change the way we how are we going to change how we run this country so that everyone shares the prosperity that will come? Well that's why I've thrown out issues about technological change and disruption because I think that this is absolutely fundamental to how we're going to live, how we work, how we do business, how we engage as a government, as countries and we have to embrace it and that's why the government is trying to lead the way with innovation policies and innovation agenda. It might make some people glaze over but the fact is this is with us and for Australia to keep ahead we've got to be ahead of this technological curve or at least abreast of this technological curve. It is so fundamental to the way our economy will be composed in the future, how it will be driven, our standard of living and that's why I think that the agility that we're going to need must be the subject of public discussion such as I hope you have today. The status quo will not be possible, we'll have to continue to change. Now Australians are adaptable, we're innovative, we have been throughout our history but we must pick up that level of and that pace of change to maintain the competitive advantages we have while not losing sight of the fundamentals of open economies, free people, free markets, the Liberal Democratic institutions and the international rules based order that has served us so well at least in the last 70 years. It's not been our universal experience that political leaders when asked to give keynote addresses including at this forum actually take much notice of their brief. They usually talk to us about what they want to talk to us about but I have to say Julie you've responded magnificently to the challenge of saying something substantive and interesting that is absolutely squarely relevant to the subject matter of our discussions over the next two days. We couldn't be more appreciative of you for doing just that and I'd ask you all to join me in thanking Julie Bishop.