 background to his current job. And we were talking about different forms of Australian football, which I still have a hard time keeping straight. So I know he's a Richmond Tigers fan. He's going to tell us which sport that is in a moment. But in any event, please join me in welcoming Joe Hockey to the podium. Thank you. Thanks. Well, thank you very much, Matt. When I talk about sport, I have many codes. With a name like Hockey, I'm very popular in Canada. And in fact, Stephen Harper keeps sending me Hockey jerseys, Hockey books, Sworn Wishes, Steven, and so on. And but yes, I'm a great fan of AFL, Richmond Tigers. And in fact, in rugby league, my team just won the premiership, South Sydney Rabbitos. So I feel as though, even though all my teams don't always win, at least I have one winner this year. And the second winner I hopefully have is the G20, which has been incredibly demanding, but incredibly rewarding this year. And I want to thank you for the invitation to speak and also the CSIS, which has these wonderful new premises. I suspect far more impressive than our embassy across the road. So we'll have to do something about that. I'm sure the ambassador is very keen to. In fact, the ambassador was just asking me for some renovation money. So his timing is perfect. To my parliamentary colleague, Steve Chabo, who was here and Secretary of the Treasury, Dr. Martin Parkinson, thank you so much. And of course, this address comes to you from the lead-up to the fourth and final G20 finance ministers and central bank governors meeting under Australia's presidency. We'll meet again in Brisbane in support of the leaders, but this is effectively the final operational meeting of the year. So when we came to government in September last year, we thought carefully about how to run the G20. We knew we needed to address both the nature of the meetings and, of course, their substance. On the former, we wanted to lift the focus of leaders, ministers and governors to the things that only they could drive and influence. To do that, we wanted to create opportunities for them to have frank discussions on the practical delivery of reforms. After all, no decisions are implementable unless we are able to take our communities and our parliaments with us on the journey. In relation to policy substance, we recognized that the G20 is at a crossroad. That's why we laid down four vital but achievable criteria. First, the G20 needs concrete practical outcomes that withstand the annual change in the presidency. Second, those outcomes have to be well communicated by political leaders. Third, the outcomes have to be an integral part of a broader and enduring economic narrative. And fourth, we thought it was important to raise the cost of failure, to make clear to G20 members that the world was watching and judging us on the implementation of our decisions. Today, I'd like to give you an overview of what the G20 agenda has achieved to date against these four criteria. I'll also outline the path to the Brisbane Leaders Summit. When I was sworn in as Australian Treasurer in September last year, it was obvious that the challenge ahead would be to maintain the G20's sense of purpose and direction. To reinvigorate the group, the agenda had to focus on achieving outcomes and uniting around an ambitious but deliverable target. We determined that Australia's G20 year would focus on improving economic growth. This was particularly important given the frequency of downward revisions in growth forecasts by the IMF in the wake of the global financial crisis. Before our first meeting in Sydney, we promised to be good stewards of the institution by maintaining the G20's relevance and keeping a steadfast global focus, no matter what the challenges of the time. With that promise in mind, we identified how our success as G20 president would be defined. We could claim success if we achieved a number of practical outcomes. Firstly, we needed to deliver policies that lift growth and create jobs. Secondly, we wanted a more robust and trustworthy financial system that supports the growth objective. And finally, we wanted to deliver on the commitments made at St Petersburg to a fair and effective international tax framework that rebuilds community trust in the global taxation system. There are several layers to this plan, so let me expand on each initiative. First, we are on track to deliver practical actions to lift growth and create jobs. In February, finance ministers and governors agreed to the Sydney Declaration, which sets out to lift our collective global GDP by more than 2% over the next five years through new structural reforms driven by individual governments. This was a first for the G20. There had always been words to reflect ambition, but never numbers, let alone a target. In fact, we described it as an ambitious target. By cans, just a few weeks ago, G20 member countries had put forward over 900 measures. The IMF and the OECD estimated that our efforts could lift global GDP by 1.8% over five years, relative to the pre-existing growth profile. It could deliver an additional $2 trillion to the world economy, and of course, millions of new jobs. So we're 90% of the way there. That's why we will intensify our efforts to find the final 10% before the Brisbane Leaders Summit in November. In Brisbane, members will present their new policy actions to lift growth. With these actions, we will lay down a credible policy monitoring process involving the IMF and the OECD. This will constitute the Brisbane Action Plan. In developing the growth strategies, members have in particular focused on lifting investment in infrastructure, which I understand you've been talking about a bit today, because through investment in infrastructure, we can address demand weakness and improve productivity. In Sydney, we thought carefully about initiatives that lift infrastructure investment, with an emphasis on fostering more private sector involvement. Some months later in Cairns, we agreed to a global infrastructure initiative, which is about increasing quality infrastructure, not just amongst G20 member nations, but right across the world. The initiative includes members' individual commitments to improve domestic investment climates, as well as collective actions to facilitate the development of infrastructure as an asset class, as well as improving project planning and preparation and reducing information asymmetries. We committed to developing a database, a global database of infrastructure projects to help match potential investors with projects. We also want to create a knowledge platform that helps to build public sector expertise and develop standardized documentation that reduces the costs of new investment and risks of new investment, I should add. We agreed to a set of best practices to help countries promote and prioritise quality investment and foster flows of long-term institutional investment. And we will support work to help grow new sources of finance for government and for investment. In Brisbane next month, we hope to announce a mechanism that will help us deliver this important multi-year initiative, to be known as the Global Infrastructure Centre. This centre can bring together in a single hub governments, international organisations and the private sector to facilitate a knowledge and information platform for new infrastructure or upgraded infrastructure across developing and developing developed economies. The centre already has the strong support of international business community, including the B20. In fact, the B20 estimates that establishing a global infrastructure hub could help facilitate tens of billions of dollars of annual infrastructure investment. It's clear that with the cost of capital at record lows, the time is right for action on infrastructure investment. Second, we are on track to completing key elements of the policy response to the financial system weaknesses exposed by the global financial crisis. In Sydney, we pledged to complete as much of the financial regulation agenda as possible. Policy uncertainty in this area began to impede key drivers of growth right across the financial services world. And from our discussion in Cairns, it's clear we've made great strides in delivering stability and certainty in that area. Globally, banks will have more and better quality capital as well as better defences against liquidity pressures. We've made substantial progress in addressing the problem of institutions that are deemed too big to fail. And as part of this work, the Financial Stability Board under the steadfast and I might say impressive leadership of Governor Mark Carney, it will soon release a proposal for additional loss absorbing capacity for global banks. This will further protect taxpayer funds if large global banks run into difficulty. That's an extremely important issue. I know it's particularly important here in the United States. It and the FSB proposal have now been largely resolved. I pay tribute to central bank governors and regulators who have not only worked incredibly hard this year to deliver these outcomes, but have been prepared to make some compromises to bring about the greater benefit for all. In addition to the rules governing bank failure, we've also made substantial progress on concerns about the shadow banking sector. And lastly, we have reinforced our commitment to reducing systemic risks and increasing transparency in markets for complex derivative products. These reforms will deliver a safer financial system that supports and facilitates greater economic growth. As a result, our citizens will have confidence in the stability of the global financial system and industry will have the confidence to invest. Ladies and gentlemen, Brisbane will mark a turning point for international financial regulation. It's not just me saying it, Governor Carney advised that to the G20 ministers in Cairns. He said, we're drawing a line of the sand at Brisbane. And it is time to draw a line of the sand on the global financial crisis. Let's move on. From the time of the leaders meeting onwards, we will look forward, not backwards, neither fighting old wars, nor re-prosecuting old agendas. With key elements of the financial reform agenda substantially completed, our focus will shift to implementation. Policy uncertainty must be removed. We want the financial regulation architecture to be set up quickly for the next phase of global growth so it can pick up emerging issues as well as balance stability with risk taking. This will be supported by the changes initiated by the FSB, including a review of its representation and an annual report on the implementation and impact of reforms. Third, we are on track to deliver a fair and effective international tax framework. In 2013 at St Petersburg, members unanimously agreed to a 15 point base erosion and profit shifting action plan to be completed by the end of 2015. The two-year action plan will not only help secure revenue bases, it will bring international tax rules into the 21st century, a system I might add that was set up just after World War I. And it will ensure they keep up with the changing business models of multinational companies. In Sydney, we expressed our continued full support with G20 and importantly, non-OECD countries all involved in the project on an equal footing. In Cairns, we walk in progress made on the action items delivered this year. Seven of the 15 proposals have been presented by the OECD to our ministers. The remainder will be presented in Turkey next year. Sure, there's still much work to be done between now and then next year, but the progress we have made is extraordinary and members are resolute about completing this complex agenda in 2015, as agreed. After all, we are finance ministers, we don't like to miss out on revenue anywhere. The G20 is also working to improve taxation, liability, transparency. We are determined to crack down on global tax evasion. Over the last few months, we've endorsed the common reporting standard on the automatic exchange of tax information. In Cairns, we made a strong commitment to implementing it rapidly and calling on outlying financial centres to do the same. This will give our tax authorities the information they need to identify and deal with tax cheats. Let me be very clear, a tax cheat is a thief. I want to assure you that finance ministers in the G20 are very determined to use all available resources to ensure that loopholes to facilitate tax cheats are closed. And to complement our policy work, the G20 has for the first time supported cooperation among our tax authorities on compliance activities, which will be a key element in enforcing compliance and identifying tax risks. Tax avoidance and evasion are issues for everyone. That's why this year we also agreed to practical steps to help developing countries address base erosion and exchange tax information, including by facilitating the work of what have become known as tax inspectors without borders. Lastly, that's the ultimate ambassadorship, isn't it? Lastly, we've improved the overall effectiveness of the G20 and we've done it in many different ways. One was by changing the nature of discussion. The G20 is well-placed to be the preeminent global economic policy-making body. The right people are in the room. The question is, are they having the right discussions? It seemed to me that there was significant fatigue within the G20, which no doubt stemmed from six years of addressing challenging economic circumstances and dealing with an agenda that expanded considerably during that time. So we chose to focus our efforts on getting global growth back on track, creating new jobs. We resisted putting new items on the agenda and focused on the issues the G20 had been debating for some time, but it failed to finally resolve. As such, we tried to direct ministerial discussions to where they were most needed. That is, towards agreement on key policy issues or cutting through roadblocks to growth. Members had in-depth discussions on macroeconomic cooperation and structural reform. We shifted the culture of the G20 by transforming it from a reactive institution into a more proactive, forward-looking one. In Sydney, we adopted practical changes to the meeting formats so that they would engender genuine discussion. We also looked to build stronger relationships among members because, if we were to work together more effectively, ministers need to know each other at a more personal level. This is important for the G20 because its strength comes from the familiarity of its members and their ability to leverage relationships. Better internal communication facilitates better external communication. It was clear to all the G20s... It was all... It was clear that all the G20's public messaging simply had to improve. Our actions had to be understood and resonate with all members of the community, not just the technocrats. So we've worked really hard to convey our outcomes in short, non-technical documents that are easily understood, beginning with a communique that is no more than two pages. We've also worked hard on our relationships with key stakeholders, including business and community representatives. This goes beyond traditional discussions to more meaningful engagement on the agenda. For example, we facilitated early engagement in Sydney on the infrastructure agenda with business representatives. This has resulted in the B20 undertaking considerable support work for our Global Infrastructure Initiative. And I want to thank Robert Milliner and all the representatives of the B20 that have made such an enormous contribution throughout the year. In fact, the feedback from business in New York and elsewhere was that the Australian B20 has been the most successful in memory. So I congratulate the team. We've also worked closely with business throughout the year on our growth and financial regulation agendas. Needless to say, the expertise, insights and ideas of the business community have helped shape our vision for the G20 and ensured our policies make a real and positive difference for global growth and resilience. And for the first time at a formal G20 meeting, we brought together the G20's official engagement groups such as the L20 representing Labor, the Y20 representing youth, the C20 representing community and the T20 representing think tanks. They all formally met with finance ministers and central bank governors in Cairns. As significant as all of this is, the agreements we've reached, we have reached on ambitious reforms are only half the job. The next step is implementation. And that's important, not just for the G20's credibility, it's crucial in addressing the real challenges for the global economy. In the past, the G20's credibility has been called into question because members didn't always deliver on their commitments. And this has been largely attributed to the growing scope of the agenda. As the G20 presidency passes from one member to the next, its agenda continues to expand in the list of legacy issues inherited by each new president gets longer every year. This poses a risk because it can distract from more important issues affecting the global economy. This year we've tried to remedy these issues. We concentrated the agenda on lifting global growth and shoring up resilience. We worked hard to build consensus among members on these priorities. It's now up to governments to deliver on their commitments, to bear the cost of failure. We need to show the world that the G20 can do more than agree to many reforms that can actually deliver them. We've done the talking, now we need the action. We need to implement and we must be accountable. Our Sydney Declaration had a five-year horizon. That's because we are tackling some fundamental challenges and, of course, that can take time. And through peer review of our growth strategies, we can keep each other honest. Of course, as policy makers, we know that many things are sometimes out of our control. If we have to, we must be prepared to commit to further reforms should macroeconomic conditions warrant it. We will draw on international organisations where their input can offer guidance on the impact or gaps of our policies. We will work with the IMF and the OECD on plans to monitor implementation and build effective accountability mechanisms. The motivation behind the Sydney Declaration is something that will keep driving us forward each year. So, ladies and gentlemen, the G20's achievements this year have been considerable. The nations that sit around the G20 table can honestly say we have made a contribution. Given that we have leaders of 85% of the world's economy sitting at the table, it's timely to recognise that our deliberations can make a significant difference. To my colleagues and the many to support our work, I say thank you. Whilst our presidency may end in December, our efforts in support of the G20's work will not diminish. There is still much work to be done to stimulate growth, to facilitate job creation and to build infrastructure that delivers enduring prosperity for all our communities. Thank you very much. Thank you very much, you want to say something? Thanks so much, I appreciate it. So, that was terrific, and I think you've achieved the objectives you laid out at the beginning of setting out some concrete goals and targets, communicating them well, trying to put them into a broader narrative, and I think you really today proved that you've accomplished that part of the mission, and now there's the final push to actually get the things done that you need to get done. So, good luck with that. And I'm struck just from what it's worth as a comment. I was going to ask a question, but I want to let the audience ask two or three questions if you're willing to do that. When I was a yak, that is a Sherpa's deputy, I've had a haircut since. It was difficult to get consensus in that room, and frankly there were floating coalitions, it wasn't sort of us versus them, but there were different groups of countries, and I just wonder how you've managed to pull these countries together, whether you've picked the right issues or the right agenda that people can agree on, but then I guess I would ask a little mischievously, have you lowered the bar too much so that people can agree to things that are sort of easy for people to agree to, or have you done something special to kind of try to build consensus? So I guess I am asking questions before I open up the floor. Well, I suppose it's a little self-indulgent to reflect on it all, whilst we're still got meetings to go, but I think Sydney, one of the comments from one of the leading finance ministers at the beginning of this year was, Joe, if you think we're going to spend 16 days flying up and down to Australia next year, you're kidding yourself, because even though the G20 is very important, three meetings in Australia takes a lot of time to get there, and it's not going to work for us if it's not a meaningful agenda. Now, we worked very hard on consulting everyone on what the agenda should be before we took up the presidency. Tony Abbott is one of those sort of people that is very focused as Prime Minister on outcomes, rather than words, and that suited the needs of the G20 perfectly. Now, I consulted all the ministers before we took the presidency at this meeting last year, said, what do you want out of the G20 next year and what is going to be meaningful? And everyone's got the same problem. Governments have run out of money, so it's very difficult and quite rare for governments to be able to use fiscal stimulus to create growth. I mean, there's some capacity, but overall it's quite limited. Monetary policy has been stretched, you know, arguably as far as it should go, but in some cases, again, there would be exceptions, but monetary policy hasn't got the capacity to deliver. Therefore, we have to have structural reform. Now, what a lot of technocrats don't understand is that ultimately we are in politics and sometimes it's a good thing to have air cover when you're going into battle. And the air cover was that the G20 was saying the same thing as we say domestically, that we have to undertake difficult but important structural reforms. Because only through structural reform are we going to be able to truly build longer-term growth in the global economy. It is also the case that there is a massive demand for infrastructure. Governments haven't got the money to be able to deliver it. The private sector is a washing cash. They are looking for these sorts of projects. If we get our collective act together and having standardized rules and standardized documentation, and in so far as is possible to have things like similar access regimes to utility markets in developing countries as it is in developed countries, to get that together, then you become a de-risk investment in public infrastructure and de-risk the engagement process for the private sector. Now, these are all common sense. And the final area is financial reform. You know, there's a temptation after a crisis to blame someone for governments. We even do it occasionally. And understandably, in the wake of the global financial crisis, financial institutions were blamed. So the response of governments has been to announce more regulation, either unilaterally or collectively. We're going to do this. We're going to have new regulation for that and so on. But the more regulation you have in the flow of capital, the more expensive that capital can become or less accessible or ultimately just adds to the uncertainty of that direction. So working closely with Mark Carney, who I met when I was in opposition a few years ago when he was in Canada, we formulated an agreement that we would nail down the priority, the real priorities for the FSB. I mean, the FSB had 73 work priorities. That was the legacy of the global financial crisis. Finance ministers, everyone kept saying to the FSB, you've got to work on this. You've got to work on that. 73 work priorities is no priorities. So I asked Mark Carney, what are the big ones? What do we have to nail? And too big to fail. Shadow banking, Basel III, there was a handful that needed to be nailed and over the counter derivatives as well. And we nailed those and then the rest of it, well, as far as I'm concerned, it can fall off the table because we've got to deal with the priorities and then get on with things. And the sweetest sound that the G20 finance ministers was Mark Carney reporting back with the central bank governors to say, we're drawing a line in Brisbane, the Brisbane line. That's when we stop looking back and start looking forward and we will deliver. There's a couple of outlying things, and we had to get a couple of countries over the line and that takes quite a bit of effort, but not only have we got a great team, I've got a persuasive style. Okay. All right. That's clear. All right. Let's take some questions, three questions. Yes, ma'am. Please wait for the microphone, identify yourself and do ask a short question. Thank you very much. Barbara Matthews of BCM International Regulatory Analytics. My question is short. Why are you so optimistic about the effectiveness of peer review over a five-year time horizon when the recent history, whether it's in the G20 in the mutual assessment process or more spectacularly in the Eurozone with the stability and growth pact, suggests caution might be advisable when relying on peer review to incentivize governments to override domestic political constraints to meet an international obligation. When I talk about peer review, we're working with the IMF and the OECD to undertake that review. So we'll all be exposed. And I would hope and expect that everyone would sign up to that. And as much as we don't necessarily like every statement that comes out of the IMF and the OECD, it's effective. Transparency helps to deal with, you know, the challenges. I think part of the problem in the past has been there's been a lack of transparency about performance. And if it's transparent, and that it's not just for you, but it's open to everyone, then, well, you know, certainly we want to benchmark ourselves in Australia against the best in the world. That's what we want to do. That's our benchmark. Other countries might have different priorities. And sure, other countries have got many different challenges to us, but I find it... transparent and forthright approach of the OECD and the IMF on things helpful. Okay, great. Yes, sir. Press question. Thanks, Matt. I'm just wondering with the World Economic Outlook downgrade over the last couple of days, the U.S. economy is strengthening, but Europe and Japan continue to struggle. Can the world economy take over and do okay just with the U.S. via power alone? Well, it helps, but I'm not as bearish as many others about China. Yes, there will be some measure of volatility, but what matters most is the determination of individual governments to do something that involves structural reform. And what has been most encouraging to me sitting around the table at the G20 is the reform agenda of various countries as they've outlined, but in a number of cases actually delivered. Now, there is domestic reform in China, and, you know, when Loji Wei goes through the list of reforms that they're undertaking and not all of them are public, it is, to me, encouraging and represents and I know from various other sources on the ground that they are being implemented. Therefore, I am not as pessimistic about China as some others. Of course, they're going to have property bubbles and various other things, but overall, it's a reformist government. In Japan, again, it is a reformist government. Now, people in some cases have been skeptical, but, you know, you look at the numbers, you look at what is the example in relation to indirect taxes in Japan and you say, this is very encouraging and in our own negotiations on a free trade agreement, we saw Japan go further than it had previously done and that's encouraging. Europe's a bit different. Europe has its own challenges and many of you will be familiar with those and I wouldn't venture an opinion on Europe, but the United States I think is showing good signs of growth. But again, the old ways are not necessarily going to be the new ways. You can't look at the global economy from the rear vision mirror. You have to look forward and tomorrow is better than today. Today is better than yesterday in the global economy. You didn't talk much about trade, but we talked a lot about it earlier and I think since you mentioned Japan, I think the best thing that we can all do is try and persuade Japan to open its agriculture market to get TPP done and move that agenda forward. I think that would be a huge contribution. This is more a bilateral conversation than a G21, but trade is clearly an important critical engine of growth. Well, it's hugely important and after the GFC there was a tendency for some countries to put up protective barriers. And there is still that danger in number of jurisdictions. And that's why, to be honest from my perspective and Australia's perspective if multilateral negotiations aren't moving, we will go into bilateral negotiations aggressively. Because ultimately if you expand the market for your produce and if you can do anything you can in order to have free trade around the world then that is a big step forward. And particularly in Asia I mean it's Asia will be the growth engine of the world over the next 30 years and beyond and there's a lot of entrenched politics in the region, historic politics people have been beating on the doors of the Europeans in relation to agricultural barriers for years. Well we haven't gotten used so let's get on with it. Good, agreed. Okay, one more Alan. Alan Alexandrov the director of the Global Summetry Project among school at University of Toronto. That's a great town. Thank you. Matt earlier mentioned that he thought the G20 had moved beyond the debate on physical consolidation which was really at the Toronto summit a little bit of Korea but really at the Toronto summit and that it would appear that you've gotten everybody on side with respect to growth, the 2% target and so forth. Are you confident though that you have on board for instance in the European which I noticed you stepped the side on particularly with respect to Germany and its impact on within the Eurozone but more generally on the argument about growth as opposed to physical consolidation. So you're asking me the European question again. Yeah, look the fundamental point is this I can look I've got all these bells ringing in my head here. Germany was initially the most cynical about the 2% target and Wolfgang who I have an enormous amount of respect for and is very much the elder statesman of the G20 finance ministers was concerned that putting a number on growth was a target that may not be achievable and it's fair to say Germany is amongst now the strongest advocates for what we've done and you can understand why because he wants to see the structural reform that we talk about and in a sense fiscal stimulation is an easy option I say in a sense I don't want to overreact but the countries that did undertake fiscal consolidation and did have structural reform are now getting the benefit in partnership with the IMF to some degree and countries that haven't undertaken structural reform and haven't had that steely determination to change are continuing to lose effective control of their budgets. Fiscal reform and fiscal consolidation is a discipline it's a discipline on government it's a discipline on parliament it is a challenge in Australia because we have some people that say more debt is not a bad thing and comparatively we have low debt that is a narrow minded and short sighted approach because anyone who's an expert on the future could only understand that you don't know what it looks like and in that sense fiscal consolidation as a plan and fiscal consolidation as a deliverable is an important discipline on communities and on government and it effectively pushes you towards structural reform now this debate between structural reform and fiscal consolidation is nothing new but I understand where Germany is coming from in arguing about structural reform in Europe and a number of economies that have not had fiscal discipline have failed to have significant structural reform there is a temptation to turn on the tap particularly at this moment I'll leave that to the Europeans to work out but from my perspective what's more important for Europe is a real commitment to structural reform and it covers labour relations that's a big one and there are other issues in relation to competition and also I know Mario Draghi is doing a terrific job in endeavouring to have appropriate stress tests and transparency associated with the banking system in Europe but you can see the recovery in the United States and the banking system and banks compared with where the European banks are at and you ask why and you start to get some of the answers to the questions that you asked ok well terrific you have a busy schedule we want to let you go but really terrific tour de force and tremendous capstone to our event today so please join me in thanking Trevor