Australia-United Kingdom Leadership Forum

Ladies and gentlemen, Britain is undoubtedly at a crossroads in history.

Australia has never been part of the European Union, and it's been a long time since we were a British dominion – but there is no doubt the Brexit vote has impacted us as well, over the other side of the world.

There has been a lot of history made right here at Lancaster House.

In 1971, on 7 July, then-British Prime Minister Sir Edward "Ted" Heath stood right here and held an international press conference on entry into the common market.

Picture 200 British and foreign journalists listening intently to a man who had one particular vision of where British priorities would lie.

Fast forward to 18 April 1988, when Margaret Thatcher stood right here and delivered a powerful speech launching her single market campaign.

Her effort to revive that same vision, renew hopes for the same priorities.

Then of course, we come to 17 January 2017, in the wake of one of the most dramatic shifts in British economic policy.

Prime Minister May stood – you guessed it! – right here to deliver Britain's plan for exiting the EU – what we now call the "Lancaster House speech."

This was a new plan for Britain, and a fresh lens on what it will mean for Britain to reach its true economic potential in this day and age, inclusive of all the people and all the differences that shape this country as distinct from 45 years ago, in 1973 when Britain joined the European Economic Community.

It might have been divorced from our own domestic charge, but at each of these moments – Heath in '71, Thatcher '88, May '17 – Australia has been watching with keen interest.

Perhaps partly due to what you might call our nostalgic connections – a shared heritage and common values.

Yet mostly, because of the more substantial ties that bind – our extensive trade and investment links, our strategic outlook, our reliance on each other as dialogue partners from the very highest levels down.

These ties are enduring and provide a foundation on which to continue to build our trade and investment relationship.

Today, Britain is Australia's seventh largest two-way trading partner - $27 billion in 2017.

You are our second largest source of foreign investment - $481 billion in 2017.

Just a couple of weeks ago on 29 June, Prime Minister Turnbull announced British company BAE systems had won the bid to design the future frigates for the Australian Navy.

We are talking about a AU$35 billion contract; what is for Britain, the largest naval defence deal of the decade.

BAE has had a presence in Australia for 65 years – the longest operating overseas private defence contractor – employing 3,500 people across 15 sites.

You are our fourth largest inbound tourism market by arrivals in 2017.

There is no doubt that any shift in the tectonic plates of British economic activity will flow on to influence Australia in very real ways.

I take, for example, the Australian wine industry.

Australia exports millions of litres of wine into the United Kingdom each year.

Granted, a lot of it disappears at that point – rumour has it the British have developed quite the palate for a good bottle from Margaret River or the Barossa Valley.

Yet many Australian wine exporters nonetheless use Britain as a hub for their product to enter into the common market.

The European Union currently imposes tariffs of up to 32 euros for every 100 litres of Australian wine – how will getting rid of these tariffs change the costs flowing on to British consumers when Brexit becomes a reality?

These are questions that Australian wine exporters are asking themselves – really, that Australian exporters of any product are asking themselves.

And no doubt businesses in Britain are asking the same.

My message today is loud and clear: when Britain is ready, Australia is keen.

Australia was the very first nation to establish a bilateral Trade Working Group, scoping out the parameters for a future free trade agreement between Australia and the United Kingdom.

We are two nations whose partnership is distinct from any other – economically, politically, strategically, and gastronomically.

There is an enormous potential for mutual economic opportunity, and our Trade Working Group is a vehicle which means we can start negotiating on Day One.

It is a vehicle that will return to us a piece of architecture that has been lost for 47 years and 11 days – autonomous trade relations between our two nations.

We have a significant economic relationship – strong bonds in both trade and in investment – and it's critical the agreement we form between us is nothing short of exemplary; terms that will continue to broaden and to deepen what we are already lucky enough to have.

We have an opportunity to create a truly modern trading relationship.

Take for example, the exponential growth of the digital economy. This is an area where we have shared interests in ensuring we develop the right framework to adapt to rapid developments that permeate many sectors of our economies and can affect broad parts of our societies.

Another example is in the area of critical minerals. Of course Australia has relied on British capital and expertise to feed the growth of our mining industry right back to the days of the 1850s gold rush.

The opening up of bauxite deposits in the 1950s and the fabulous riches of the Pilbara in the 1960s were funded through Anglo-Australian joint ventures.

The same can be said of the opening of oil refineries by BP and financing the foundation of our LNG export industry in the North West Shelf in the 1980s.

Now new horizons beckon. Australia hosts the world's largest and highest quality deposits of hard-rock lithium needed to power the next generation of electric vehicles, and substantial deposits of rare earths needed in wind turbines, electric motors, and high-tech defence applications.

Australia stands ready to power the world's coming new energy revolution. And as before, we welcome the support of London, one of the centres of mining finance, to bring it to fruition.

In the meantime, of course, we are all too well aware that negotiations with the European Union remain a priority for the UK.

Despite the long slog, it is essential for Britain and the EU to settle on a top quality trading agreement.

We hope to see the emergence of a relationship on new terms – terms that are mutually beneficial, terms that sustain your economies, terms that support your global influence.

Settling for anything less than that would send an entirely wrong message out to an international trading framework that is already vulnerable to attack.

The global leadership role that Britain continues to play in the 21st century cannot be understated.

Like Britain, Australia, along with so many other nations, is committed to an open and rules-based global economy.

We set this out clearly last year in our Foreign Policy White Paper – our commitment to resist protectionism, our vision for an open, rules-based international economy.

Consider this: within months of when this Government came into power, we had finalised not one but three separate North Asian free trade agreements – one with China, one with Japan, one with Korea.

We did so because it was critical in achieving our own trade and investment outcomes, and also because we recognised the emergence of the Indo-Pacific as a major powerhouse and as a vital presence in international trade.

When the United States pulled out of the Trans-Pacific Partnership – the TPP – we saw it as a call to arms for the defence of rules-based trade as a global ideal.

We were innovative and active in working with key players like Japan – and in the end, we achieved what many said could never be achieved without US support.

This was a considered course of action. One which recognised the need to be ambitious and creative, especially at a time when the WTO Doha round was falling over.

Importantly it demonstrated foresight. And with the stresses on the global trading system today, the reasoning is more pertinent.

That is why this Government is continuing an active trade agenda across the board.

We have signed a free trade agreement with Peru; we are negotiating with Hong Kong, and we are getting to the pointy end of negotiations with Indonesia.

We are pushing ahead to finalise the multinational RCEP FTA and the Pacific Alliance FTA. And of course we have just commenced negotiations for an agreement with the European Union.

Needless to say, we consider this a very high priority in our agenda – achievements like these don't come about just by chance.

There are two reasons why we have pushed so actively for this program.

First, bottom line is we know these agreements are fantastic for our businesses, for our communities, for our economy.

Second, and just as important, we are trying to show leadership in a global trading environment that is already challenging the authority of world trade rules.

That's the sort of leadership role we try to take up for ourselves, and that's the sort of leadership role we see equally for a post-Brexit Britain.

Let's be honest here – Brexit has probably been a bit of a headache to most of you here in this room today, the leaders of this New Britain.

Yet for all its challenges, Brexit presents the kind of opportunity that so rarely comes to pass.

As you lead into some of the final negotiation deadlines, you have the opportunity to negotiate your own economy on your own terms.

Your own commitments to the Continent, your own commitments in the WTO, your own commitments to your bilateral partnerships.

As Britain steps forward into this next stage, I can assure you that Australia stands ready, our ambitions set high.

We look forward to the next regeneration of the British vision, and we look forward to continuing as the strongest of economic partners in the years ahead.