Ambassador Berry’s Address to the American Chamber of Commerce, South Australia

This year we celebrate both the 75th anniversary of diplomatic relations between the United States and Australia and the 10th anniversary of our free trade agreement. I think it’s a perfect time to reflect on our partnership. Part of what makes it so strong is our great trade and investment relationship. It is broad, deep, and – like our alliance – historic.

Americans and Australians have been doing business together since the Philadelphia arrived in Sydney Harbor in 1792. It had a cargo that included beef, tar, and most importantly, rum – the makings for a great barbeque!

That was the beginning of a beautiful friendship – and a great business partnership.

Ten years ago, that partnership was cemented even more firmly with the signing of the Australia-U.S. Free Trade Agreement. I would argue that this agreement has had a greater effect on the bilateral relationship – and the globe – than any other except ANZUS. It’s a relationship that is tremendously beneficial to both the United States and Australia.

Australian Ambassador Kim Beazley has said that ours is Australia’s most successful FTA, in terms of what he calls “kit and cash.”  U.S. companies are major exporters of agricultural and mining machinery (the “kit”) and major investors in those industries (“the cash”).

Hundreds of U.S. companies – including some of our largest – are exporting to, and investing in, Australia. Chevron and ConocoPhillips have their biggest investments in the world here. Boeing has its largest footprint outside the United States in Australia. Australia is GE’s second biggest market after China. This is also a top five market for Medtronic, which earned $800 million in revenue here last year.

Innovative pharmaceutical giant Merck – known in Australia as MSD – has numerous links with Australia. These allow them to do business, to support research and clinical trials, and to engage with hospitals and universities across the country. Among other successes, MSD cooperation with Australian researchers helped bring the Gardasil vaccine to market. This vaccine prevents 90% of the cancers that can be caused by the human papillomavirus.

According to a 2015 independent study by the East-West Center, United States Studies Centre, and the Perth USAsia Centre – “Australia Matters for America,” since AUSFTA was implemented, our two way goods trade has increased by 65%. The two ways services trade has increased by 72%. Our bilateral trade of goods and services is worth more than $61 billion.

By the end of 2013, U.S. Foreign Direct Investment stock in Australia was $159 billion, and Australian companies had invested $44 billion in the United States. If we count indirect investment, our entire economic relationship is worth more than a trillion dollars.

That is a success by any measure – not just for companies, but also for the public. U.S. exports to Australia directly support more than 300,000 American jobs. And, American companies employ more than 350,000 Australians.

My hope is that some of these Australians are veterans. I made a promise to the RSL last month that I would champion veterans’ employment to the American Chamber, just as I took the hiring of veterans to record highs when I was the Director of OPM. Veterans bring invaluable skills and traits to the workforce. Skills not taught in the classroom, but developed on the battlefield, such as leadership, teamwork, adaptability, and critical thinking. The talented pool of Australian veterans is one of the many benefits of doing business here.

In March, when I was back in the United States promoting the benefits of doing business in Australia, I had the opportunity to tour several U.S. companies that do business in Australia.

What these companies know from experience is that exporting is just good business. The vast majority their customers – 95% – are located outside the United States. That is why agreements such as the one we have with Australia and the TransPacific Partnership under negotiation are so very important to our future economic health.

AmCham’s membership looks not only to do business in Australia but to use Australia as a base from which to access the vast and growing markets of Asia. This region is rapidly developing. Today’s burgeoning middle class is keen to acquire the high-end goods and services that we produce.

For these reasons the TransPacific Partnership deal is of utmost importance.

This cutting edge trade deal is the economic centerpiece of President Obama’s rebalance to the Asia-Pacific region. The 12 countries in the agreement together make up 40% of the world’s GDP.

Not only will the TPP promote trade and open markets, the TransPacific Partnership is critical to the promotion of a stable, transparent, rules-based order for the 21st century, this century.

We are currently in the end stages of negotiating the final details of the TPP. The President, Secretary Kerry, and I remain confident this historic agreement will be concluded soon.

TPP has bipartisan support in the U.S. Congress, which approved the trade promotion authority legislation. I’d like to ask you to let Congress – both sides of the aisle – know how important the TPP is for the future of American businesses. You as individuals and the American Chamber as an organization have powerful voices. I urge you to use them both early and often.

This century’s history will be defined by the Asia-Pacific, and the United States and Australia need to be there to help write the next chapter.

Success in this century was the theme of President Obama’s State of the Union address in January. Unsurprisingly, both national success and business success depend upon the same things: well-educated and knowledgeable workers, more exports, free and fair trade environments, and – far and away the most important – innovation. Without strong research and development and cutting edge science and technology, we cannot remain competitive in the global economy of the future.

Fortunately, companies like yours – and like the ones I visited when I was back in the United States – are rising to meet the challenges.

3M, whose tagline – “Innovation” – describes perfectly the secret to their success, gave me a tour of their innovation center in St. Paul, Minnesota. Last year they were awarded 625 patents in the United States, adding to their total of more than 100,000. This is a company that took sandpaper and turned it into masking tape and turned that into a giant multinational with more than 60,000 products under production.

Intellectual Ventures in Bellevue, Washington, uses its vast network of inventors to solve global problems. Right now they’re working on keeping vaccines cold for longer periods so they don’t spoil, a new kind of broadband antenna, a nuclear reactor that uses the waste of other reactors, and a new feed for dairy cows that increases milk yield.

Kimberley-Clark is innovating right here in South Australia. Its Millicent Mill in Mount Gambier produces 85,000 tons of tissue paper each year for the New Zealand and Australia markets.  Recent innovations, including a co-generation plant, improvement of wastewater quality, and introduction of automated guided vehicles, have improved efficiency and helped it compete globally.

The $33 million co-generation plant, for example, uses clean gas to power a turbine engine and generate electricity for the entire factory.  The plant has helped reduce energy costs and also has eliminated 80,000 tons of carbon dioxide emissions annually.  It is estimated that the plant injects $130 million into South Australia’s economy each year, and employs nearly 400 workers.

So you see, Americans don’t have a monopoly on good ideas or talented people. U.S. firms are working with scientists and engineers from every country to revolutionize the world we live in. If we want to solve the world’s greatest problems, we must look beyond our borders and increase our cooperation.

We could have no better partner on in this goal than Australia. Former Prime Minister Bob Hawke called Australia the “clever country,” and he was absolutely right. South Australia is a prime example of Australian ingenuity and innovation as it transitions from a hub for traditional manufacturing to a center for the knowledge economy.

Adelaide was recently named the first smart and connected “Lighthouse City” in Australia by U.S. company Cisco – due to its “Internet of Things” Innovation Hub. The Internet of Things refers to everyday devices – such as household appliances, watches and cars –“talking” to each other via the internet. Other Lighthouse Cities include Chicago and Dubai. Lighthouse City status for Adelaide will help make it one of the leading global examples of a smart and sustainable city.

Hewlett Packard and Microsoft have also established innovation centers in Adelaide. HP ‘s Innovation and Collaboration Centre is a key component of the University of South Australia’s new Science Creativity and Education studio. The Microsoft Innovation Centre South Australia or MICSA (mick sah) is designed to help drive the next generation of startups and entrepreneurs, as well as accelerate the growth of small- to medium-sized enterprises.  MICSA aims to graduate more than 40 start-ups in its first 18 months.

Lockheed Martin, Raytheon, and other U.S. defense industry firms are key contributors to “Defence SA” in defense industry precincts throughout South Australia.

I know that South Australia is also an education magnet. South Australia hosted more than 30,000 international students last year, many of them from the United States. Australia is the most popular destination in the Asia Pacific for American students, and the United States is the most popular destination for outbound Australian students.

Fulbright scholars and students are an important part of this trade. For six decades, the Australian-American Fulbright Commission has been working with universities in South Australia. The exchange of ideas generated, not to mention the billions of dollars international students bring in to the economy, makes both our countries richer.

As everyone in this room is aware, the variety and quality of the work the United States and Australia are doing together is absolutely cutting edge. From space to neuroscience and from agriculture to medicine, we are changing the world on a daily basis. Our partnerships help our economies expand, develop, and compete in the world market. Our partnerships are necessary to spark innovation, which is one of the keys to improving productivity.

But one of the common concerns I have heard over and over is about the difficulty of getting ideas funded so that projects could make the leap from the drawing board to the market. Making a scientific or technological breakthrough shouldn’t be the easy part of the equation.

That is, in part, why we began a series of “Ambassador’s Innovation Roundtables” last year. The next event is tomorrow here in Adelaide at the Tonsley Industrial Area – where the future of South Australia industry is rising from the ashes of an old car plant.

These events put students, business leaders, academics, government officials, venture capitalists, and entrepreneurs in the same room to talk about best practices and expanding cooperation.

Increased cooperation and increased integration – between the United States and Australia and regionally – will pave the way to the future.

Over the years, our historic ties have grown to encompass issues ranging from educational exchanges to trade to conservation to scientific research. We are working together to counter violent extremism and the hateful ideology of ISIL, to contain the spread of Ebola and find a cure for AIDS, to develop new sources of energy, and to encourage the entrepreneurs of tomorrow.

As FTA partners, we’ve built close partnerships through increased trade and investment. Thousands of our citizens are doing business across the Pacific Ocean, making our bilateral ties even stronger than they were a decade ago.

As global partners, we’ve worked together in the multilateral forums that are building the 21st century economy, from APEC to the WTO to the G20. We are finalizing the next chapter – the TransPacific Partnership agreement – that will ensure the security and prosperity of this region for decades to come.

These regional institutions and tools for economic integration will help the United States, Australia, and the region weather economic ups and downs.

When President Obama was in Brisbane last November, he spoke about how Australians and Americans share many traits. We are both nations of immigrants. Our forebears bequeathed to us a common desire to push toward the frontier, to seek the next challenge beyond the horizon, and to discover solutions before others even realize that there is a problem.

We know, as the President said, that “the future is ours to make.”

And we are making that future together with business people like you – and companies like yours – leading the way.

Thank you. I look forward to our discussion.