Increasing the impact of Australia’s economic diplomacy

If there is one thing that most Australians, from across the political spectrum, can agree upon it is that foreign policy has emerged as one of the key strengths of the Coalition Government lead by Prime Minister Tony Abbott and his team. The energetic and creative leadership of Foreign Minister Julie Bishop and the Trade and Investment Minister Andrew Robb was demonstrated most recently with the launch of the Coalition's Economic Diplomacy policy at the Lowy Institute for International Policy in Sydney.

Economic diplomacy is a strategic and operational concept that has been used by sovereign states to achieve better economic, security and development outcomes in partnership with key internal and external stakeholders especially with the corporate sector. Economic diplomacy has been refined and implemented effectively by super powers, middle powers and emerging economies to improve bilateral, regional and multilateral economic relations and systems. All members of the G20 use economic diplomacy policies strategically to promote their interests. The USA, China, Russia, Brazil, Turkey and India have policies and programs in place to support their economic agenda and their foreign policies.

Australia has a proud tradition of using economic diplomacy to improve national and global prosperity. Australia was a key supporter of the Bretton Woods initiative in 1948. This lead to the creation of the International Monetary Fund and the World Bank as instruments for economic development and global stability.

The Abbott-led Coalition has elevated and prioritised economic diplomacy to become a core pillar of Australian foreign policy along with defence and international development assistance. Australia's economic diplomacy agenda is based on promoting trade, encouraging growth, attracting investment and supporting Australian business and state governments through economic statecraft. Australia's leadership role in the G20 and the forthcoming Leaders Summit in Brisbane in Nov 2014 provides the perfect platform for showcasing its commitment to boosting economic growth, creating jobs and addressing pressing issues in global economic governance

As noted by Foreign Minister Julie Bishop 'Australia is the 12 largest economy and to retain and improve this position requires strong international engagement.' It also requires continuous innovation and investment in strategies, capabilities, business practices and performance management systems that will deliver positive and significant economic outcomes for Australia and the world.

History tells us that having a strategic vision and intent to achieve economic outcomes is just the starting point. Closer attention needs to be focused on institutional and budgetary constraints to economic diplomacy. In particular, we need to ask to three important questions. First, to what extent are Australia's institutions ready to deliver the desired economic diplomacy outcomes from a strategic, operational and cultural aspect given the risk averse nature of Australia's public service? Second, to what extent is Australia's economic diplomacy funded to run long term, expensive, sensitive and sometimes risky campaigns given the pressure to reduce government spending and interference in business? Third, to what extent is Australian business ready to compete on the world stage given that 90% of local businesses do not export?

Our esteemed Foreign Minister Julie Bishop is well aware that Australia's economic diplomacy policy can be strengthened if all key stakeholders feel ownership of the concept and the agenda.

It would have been beneficial if there was more national, parliamentary and public policy debate on economic diplomacy using an Economic Diplomacy White Paper as a framework for debate. Such a document and consultative process would have enabled the Australian Government to systematically analyse and calibrate the conditions for high impact economic diplomacy in a highly competitive and risky global economy. Economic diplomacy can be a two-edged sword. Australia is at constant risk of being exposed to economic sanctions from the increasingly assertive China, Russia and others in response to our economic and security policies and the irresponsible statements by the likes of Clive Palmer and some PUP senators.

Solid and robust economic diplomacy policy and practices can deliver multiple benefits for Australia. It can enhance Australia's economic reach and impact. It can revitalise Australia's foreign policy impact on the most strategic challenges facing Australia and the world. It can innovate and transform the way Australia conducts diplomacy and development. It can also protect core Australian interests by promoting sustainable economic development, entrepreneurship and civil society. It can shape a better world if everyone plays by the same rules.

Australia's economic diplomacy can also be enhanced by harnessing the power and business networks of its global diaspora It can also benefit from the input from the diasporas of other countries that call Australia home.

The United Macedonian Diaspora (UMD) welcomes the Coalition's Economic Diplomacy policy and is already part of 'Team Australia'. UMD has been working with the Australian Government and the Australian Parliament to advance closer economic relations with South East Europe and with the Republic of Macedonia. We have been waiting patiently for years for Australia to ratify basic agreements and to transform its policies which can boost trade and investment with this part of Europe. Australia needs to engage all the ethnic chambers of commerce into the economic diplomacy agenda. It also needs to nurture economic diplomacy with all parts of the world starting with the countries in our region and beyond. Australia should also seek to attract as many supporters and followers as possible as strategic partnerships and initiatives can reduce costs and deliver better outcomes. We must constantly be aware that in a globalised and turbulent world we are heavily dependent on trade and investment. We must run twice as fast to retain our top 20 economic status. We also need to recognise the profound shift of economic power in our region and act accordingly.