I come to the Assembly, as
Australia has each year since the first session of the
General Assembly in 1946, and I come in the same
spirit, to seek solutions to the great challenges of our
age and together help give those solutions effect.
The challenges are not new. They are reflected in
the Preamble to the Charter which we, as an
international community, crafted together: “to save
succeeding generations from the scourge of war”, to
advance economic growth and social progress for all,
“to reaffirm faith in fundamental human rights … in
the equal rights of men and women and of nations large
and small”. All those great undertakings were to be
reflected in a new body of international law.
Two thirds of a century later these great
international values remain constant, while the
challenges to which we apply them are subject to
continuing change. It is on the current challenges
facing the global order that I wish to speak to the
General Assembly at its sixty-fourth session today: the
global financial crisis, the unfinished business of the
Doha Round, the unfolding crisis of the planet itself,
unresolved questions of nuclear weapons 20 years after
the end of the cold war, and the future of global
governance itself.
Just on a year ago, just down the road from here,
a destructive chain of events triggered the worst global
financial crisis in three quarters of a century. It was
just on a year ago that I addressed the Assembly for the
first time, 10 days after the collapse of Lehman
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Brothers, to reflect on the challenges which lay ahead
for the proper regulation of global financial markets.
That reform programme is now under way,
through the Group of 20 (G-20), the Financial Stability
Board and the International Monetary Fund (IMF). But
there remains much work to be done to prevent the
unrestrained greed of unregulated financial markets
that has wrought such economic carnage across the
world in the past 12 months from sowing the seeds of
future financial crises.
The global financial crisis has been a wake-up
call to the international community to reform the
institutions of global governance, and a wake-up call
that our system of global governance today is in need
of radical reform. Because the truth is that the failure
of these institutions is not just a matter of concern for
Governments and for diplomats and for economists; the
price of the failure of these institutions has been paid
by working people and their families right across the
world.
The events on Wall Street spread rapidly and
indiscriminately to every corner of the globe, from
London to Lima, from Beijing to Barcelona, from
Melbourne to Mumbai, to developed and developing
economies. This global financial crisis and its ensuing
economic and employment crisis has been no respecter
of national boundaries, and no respecter of peoples.
Australia has been no exception. The global
financial crisis saw the Australian stock market fall by
55 per cent. It wiped around A$ 150 billion from the
retirement savings of Australian workers. And it led to
tens of thousands of Australians losing their jobs. We
expect more job losses to follow. Behind each of these
statistics lie the faces of working Australians, who
have seen their savings diminished, their financial
security eroded and their job security threatened.
I think of places like Liverpool in Sydney, where
the decline in its light manufacturing base has led to an
increase in unemployment of 4.5 per cent over the past
year, and where now 19,000 local people are without
work; like the tourist destination of Cairns in far North
Queensland, where unemployment has risen by 3.7 per
cent over the past year, meaning that 13,300 people are
now out of work in that area; and like the south-eastern
suburbs of Perth, where unemployment has risen by
3.3 per cent in the past year, leaving 12,800 people in
that community without a job as well.
In communities like those across Australia the
global recession is hurting in very real ways, just as in
communities like them across the world the global
recession is hurting in very real ways. We can never
forget these men, these women, and their families, as
we seek to find a path out of this global recession.
While our global economic system failed
comprehensively to prevent the crisis, the G-20
Governments have rallied to reduce the damage and
prevent systemic collapse. Through the agency of the
G-20, for the first time involving heads of Government
from the major developed and developing economies,
Governments acted in concert to provide around
$13.6 trillion-worth of support to directly stabilize the
global financial system; to inject $5.5 trillion-worth of
fiscal stimulus into the global economy; to provide
$1.1 trillion in resources to the international financial
institutions, to give markets confidence that any
subsequent collapses could be dealt with; to develop
also an integrated framework of toxic asset
management to repair the balance sheets of many
major banks; and to initiate a comprehensive financial
markets reform programme, through the Financial
Stability Board.
The IMF has assessed that these extraordinary
interventions succeeded in breaking the fall in what
was an economic crisis spiralling out of control.
But the truth is that our global economic recovery
is far from certain, and that many twists and turns lie
ahead. Furthermore, the institutions of global economic
governance are facing new challenges. First, the
financial market reform programme must be completed
and implemented to prevent a future crisis. Secondly,
in anticipation of global economic recovery, we must
agree on a framework for the coordinated withdrawal
of our emergency interventions. And, thirdly, and most
critically, we must articulate a new framework for
sustainable future economic growth, a framework that
does not simply return to business as usual, based on
unsustainable financial imbalances and excessive
consumption, fuelled by consumer and corporate debt
and irresponsible risk-taking in systemically significant
financial institutions.
One of the failures of the old growth model of the
last decade was the lack of effective global economic
coordination. This allowed imbalances to grow
unchecked and financial institutions to remain
inadequately supervised. As we move towards
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recovery, we must build a framework to foster both
growth and balance in the global economy. The IMF
estimates that effectively implemented coordination
between major economies could add significantly to
global growth — an additional 10 per cent to global
output, or around $6 trillion over a five-year period. To
achieve this coordination dividend the G-20 will need
to build on the structures of cooperation that have been
established during the crisis and apply them to the new
challenges of the global recovery.
In Pittsburgh we have a historic opportunity to
agree on a framework to deliver effective coordination
of our national economic policies. This framework
should have four key elements.
First, G-20 members should agree on a common
objective to achieve balanced and sustainable growth.
Secondly, G-20 members should outline their own
national economic strategy and identify how it
contributes to our common objectives. Thirdly, the IMF
should analyse individual national economic plans to
determine whether they are consistent and collectively
adequate to achieve sustainable and balanced global
growth. And, fourthly, this report should be submitted
to the G-20 to form the basis of peer review, which
would identify specific risks and vulnerabilities for the
future. This framework should be consistent with, and
an important input to, the development of a set of
global principles, such as the current proposal from
Germany for a charter for sustainable economic
activity.
The other great global challenge of our age is
climate change. With only 74 days remaining until
Copenhagen, the Governments of the world are far
from agreement. Enough has been said about the need
for action on climate change, but as of today not
enough action has been taken. Our collective political
will to date has not been adequate to meet the task. For
too long discussions between developed and
developing countries have degenerated into mutual
recrimination, with developing countries accusing
developed countries of failing to meet their obligations,
given their undeniable responsibility for the bulk of
greenhouse gas emissions already in the atmosphere,
and developed countries warning the major emerging
economies that unless they take action global warming
will increase to unacceptable levels, based on emerging
economy emissions alone.
The trouble is that both arguments are right. What
is required globally is the leadership to embrace this
truth and respond to it accordingly, because the truth is
that all our Governments need to reach beyond their
self-interests and instead fashion a grand bargain
between the developed and the developing countries of
the world: a grand bargain on climate change which
embraces both historical and future responsibility; a
grand bargain which is anchored in the science of
climate change and the need to keep temperature rises
within 2 degrees Celsius to avoid catastrophic climate
change; a grand bargain embracing the three great
challenges of climate change which we are yet to
resolve.
Those three challenges are to answer these
questions: what binding targets and commitments must
developed and developing countries adopt to keep
temperature rises within 2 degrees Celsius; what public
and private climate change financing arrangements are
necessary to support the mitigation and adaptation
measures we need to implement in the future; and what
technology transfer do we need to undertake in
renewable energy, in carbon capture and storage, in
energy efficiency and in the avoidance of deforestation
and forest degradation to bring about real reductions in
greenhouse gas emissions?
In the period ahead, the grand bargain we must
strike needs to resolve all three of those challenges, as
each is inextricably dependent on the other. We must
make use of all available mechanisms for international
cooperation, including the Major Economies Forum
and the G-20, to achieve success in the negotiations.
For us all, this will be a test of our leadership,
leadership which seeks to lift our collective vision
beyond today and instead focus on the needs of
tomorrow.
But time is short. As Chair of the Pacific Islands
Forum, I know that time is already running out for the
island States of the Pacific. Coastal inundation is not a
prospect; it is a reality. Fifty per cent of the population
of those island States reside within 1.5 km of the coast.
The South Pacific is part of the human face of climate
change. And that is why Australia, nationally,
regionally and globally, stands ready to play its part in
acting on this great moral, environmental and
economic challenge of our time.
This Organization was born in the shadow of
nuclear weapons; that shadow remains today. One truth
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remains absolutely clear: the proliferation of nuclear
weapons can never make any country more secure. The
nuclear test by North Korea this year was rightly
condemned across the international community. It
reiterates that the only path to safety is through the
eventual elimination of nuclear weapons. Australia is
encouraged by the commitment of the United States
and Russia to further reduce their nuclear arsenals, but
the international community must also progress the
broader disarmament and non-proliferation agenda.
The Nuclear Non-Proliferation Treaty has played a
crucial role in limiting the spread of nuclear weapons,
but the Treaty today is under grave challenge. We must
work to ensure that its global security benefits are
reinforced by a successful Review Conference in 2010.
To reinvigorate global consensus and activism ahead of
that Conference and beyond, Australia and Japan last
year established the International Commission on
Nuclear Non-proliferation and Disarmament, which in
the next few months will produce its final report. Its aim
is to chart a practical and realistic course to achieve a
strengthened non-proliferation disarmament regime,
leading to the ultimate elimination of nuclear arsenals.
Tomorrow’s Security Council summit on
non-proliferation and disarmament is important for us
all. We must not miss the opportunity it offers to
summon the political resolve to move towards a
nuclear-weapons-free world.
The challenges of global governance extend
beyond the global financial crisis, climate change and
the threat of nuclear weapons. The realization of the
Millennium Development Goals is fundamental to the
elimination of extreme poverty. It remains an obscenity
that in 2009, after an age of unprecedented global
prosperity, 1.5 billion of our fellow human beings are
living in extreme poverty. That is a core reason why
the Australian Government has committed to
increasing official development assistance to 0.5 per
cent of gross national income, to help close the
development gap which has been widening in many
Pacific island countries, while also helping, where
possible, to deal with poverty elsewhere in Asia,
Africa, Latin America and the Caribbean.
Parallel to the Millennium Development Goals,
the Doha Development Round has now been going for
eight years. This is too long. The negotiating gap
between us all is not wide, but the deficit in political
will to conclude the Round seems vast. As the world
searches for a new growth formula to sustain long-term
economic recovery, surely Doha represents one critical
element? Australia, as one of the lead negotiators
within the Doha Round, remains ready to help bridge
the negotiating gap.
Let the Assembly also not forget the continuing
critical work of the United Nations across the full
spectrum of global governance — issues concerning
international peacekeeping operations, humanitarian
operations, food security, women, health, children and
refugees — all hallmarks of a civilized global order.
The United Nations is not a place; it is not an
institution. The United Nations is us, “We, the peoples
of the United Nations”, as the Charter begins. It is we
who must find solutions to the problems we face, build
consensus around those solutions, and implement them.
This Organization had its beginnings not in an act of
will, though will was certainly needed, but in an act of
imagination, an idea of what the world should and
could be. This is the challenge of leadership: to
imagine a future worth having and then craft that
vision into a practical and present reality.
That was the challenge to which our forebears
rose in 1945. That is the challenge to which our
generation must now rise for the future.