Australia to launch $2bn fund to ‘turbocharge’ trade with south-east Asia
Australia will set up a $2bn fund to “turbocharge” trade and investment in south-east Asia, with a focus on clean energy and infrastructure.
The prime minister, Anthony Albanese, will announce the fund in Melbourne on Tuesday when he addresses a gathering of 100 chief executives from Australia and south-east Asia.
Albanese will say in a speech that he is pursuing “the most significant upgrade of Australia’s economic engagement with Asean for a generation”, referring to the Association of Southeast Asian Nations.
He will also promise to improve access to longer-term visas for south-east Asian travellers, saying this “demonstrates unequivocally that Australia is open for business, tourism and trade”.
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The $2bn south-east Asia investment financing facility is to be managed by Export Finance Australia. It is expected to provide loans, guarantees, equity and insurance to increase Australian trade and investment in southeast Asia.
“The government I lead has made it clear: more than any other region, south-east Asia is where Australia’s future lies,” Albanese will tell business leaders, according to speech notes distributed to media in advance.
He will say Australia’s two-way trade with Asean member states topped $178bn in 2022 – and two-way investment was worth $307bn – “but we want to do more to support regional growth and to realise mutual benefits”.
The treasurer, Jim Chalmers, said he would speak to the same gathering of investors on Tuesday “because we really believe we can turbocharge these relationships with Asean countries”.
Chalmers said Asean was “the hope of the side when it comes to two-way trade”. As a bloc, he said, it was already Australia’s second-biggest trading partner.
“[It is] bigger than the US, bigger than Japan, bigger than the EU, second only to China,” Chalmers told Sky News.
“This is where the action is – in Asean – and we want to get a bigger slice of that action.”
On Tuesday the government will also earmark $140m over four years to extend the Partnerships for Infrastructure Program. The program has helped fund transport, clean energy and telecommunications projects since launching in 2021.
Australia will set up regional “landing pads” in Jakarta and Ho Chi Minh City to “provide on-the-ground support to help Australian businesses to boost technology services exports to southeast Asian markets”.
Trade and investment are a major focus of this week’s special summit in Melbourne, held to mark 50 years since Australia became Asean’s first dialogue partner.
But security and great power rivalry between China and the US also loom large.
China, like Australia, is not a member of Asean but is a dialogue partner to the regional bloc.
Some Asean members have tensions with China over competing maritime and territorial claims in the South China Sea, but the regional bloc resists taking sides in the strategic contest between Beijing and Washington.
The Australian foreign affairs minister, Penny Wong, warned on Monday that “the region’s character” was under challenge, including in the South China Sea.
In a veiled reference to China, Wong said: “We face destabilising, provocative and coercive actions, including unsafe conduct at sea and in the air and militarisation of disputed features.”
Addressing a maritime cooperation forum at the special summit, Wong called for a regional balance “where no country dominates and no country is dominated” and “where each country can pursue its own aspirations”.
Wong welcomed the resumption of leader-level and military-level dialogue between China and the US as “important steps on the path towards stability that the region has called for”.
But she said all countries, not just the major powers, must “shape habits of cooperation that sustain the character of our region”.
She said all countries should “insist differences are managed through dialogue, not force” and “insist that communication never be withheld as a punishment or offered as a reward”.
“We want to support Asean member states to ensure, collectively, we all have the practical tools we need to be able to rapidly and effectively deescalate tensions and crises.”
Wong said the government would commit $64m over the next four years to help Asean countries “increase resilience to coercion and ensure waterways that serve us all remain open and accessible”.
Albanese met the Malaysian prime minister, Anwar Ibrahim, in Melbourne on Monday and promised closer collaboration on issues including cybersecurity and nuclear non-proliferation.
Malaysia was an early critic of Australia’s plan to acquire nuclear-powered submarines, but Anwar avoided direct criticism of the Aukus pact at his joint press conference with Albanese.
Anwar expanded on his recent comments about a rise of “China-phobia” in the west.
“We are an independent nation. We are fiercely independent. We do not want to be dictated by any force,” Anwar told reporters.
He said Malaysia remained “an important friend to the US and Europe and here in Australia” but that “should not preclude us from being friendly to one of our important neighbours, precisely China”.
“And if they have problems with China, they should not impose it upon us. We do not have a problem with China.”