Mr Rudd is, as I am speaking to you, using his multi-lingual talents to promote greater openness and dialogue here in China. We can be proud that we have the only Mandarin speaking leader in the western world and I know this is particularly well received in China.
I am also delighted that ANZ is hosting tonight’s dinner. Australia’s relationship with both China and India and our place in the region is of great importance to me.
I have spent much of my working life in the region and it is clear that Asia is an essential part of our future. For ANZ we have set an aspiration to create a “super regional bank” which involves becoming a leading foreign bank in the region with a significant presence in Greater China and India.
The reason we have set this aspiration is clear.
-A banking study by McKinsey forecasts that emerging markets will contribute around half of new banking revenues between 2006 and 2016. These are expected to be in the order of US$5.7 trillion.
China is expected to maintain its recent accelerated growth rates and Indian banking revenues are expected to overtake those of the countries of Central and Eastern Europe.
We are also following our clients into the region.
Many of the businesses I talk to are already deriving part of their earnings from China, India and the region. Asia constitutes more than 50% of Australia’s trade flows and is growing fast. We are the leading destination for the education of a new generation of Asian people. And furthermore, Asian migration accounts for 40 per cent of our population growth. That is little surprise given our geographic proximity.
Underpinning this is the pace of recent growth and the outlook for the economies of both India and China even though, in line with the rest of the world, these economies are expected to slow a little in the coming year or two.
We expect real GDP growth, in both China and India, to be an average of about 9 per cent per annum over the coming decade. That is more than double the rate of growth we expect for Australia and around four times the rate of growth we expect for the “developed economies” of the world between 2010 and 2020.