Report on dinner and panel discussion with Reserve Bank of Australia Governor, Mr Philip Lowe

Melbourne, Monday 27 May 2019

In keeping with its tradition of engaging with leaders of international significance, the Global Foundation convened a major dinner and roundtable discussion in Melbourne on 27 May, 2019, with the Governor of the Reserve Bank of Australia, Philip Lowe.

The dinner was hosted by Michael Clough, Chairman of King & Wood Mallesons, a Key Partner of the Foundation. Dinner was attended by 63 members and guests.

The topic for the evening, ‘Where to now for Australia and the global economy?’ was addressed by Mr Lowe and a distinguished panel, comprising Alan Kohler, Editor in Chief, InvestSMART; Danny Casey, Chair, Catholic Super; Louise Watson, Member of the Board, the Global Foundation and Managing Director, Symbol Strategic Communications.

The dinner was conducted according to the Chatham House Rule, that is, it was unattributable.

Key messages:

The Australian economy is softening and will likely require both monetary and fiscal responses. Monetary policy and the cutting of interest rates are only one dimension, but not of themselves likely to be sufficient. Fiscal responses, including further investment in infrastructure and structural reforms to boost productivity, may be of even greater importance.

It was positively noted that the recently re-elected Prime Minister and Treasurer had called on the RBA Governor in the days immediately following the recent Federal election.

In Q & A discussion, there was some contention about the suitability of the RBA’s target inflation range of 2-3% relative to other factors in the economy, including wages growth and the unemployment rate.

At the same time, the Australian economy is impacted heavily by global factors, some less benign than others. The worst-case scenario, of a China-US ‘cold war’, with further escalation over the current and trade and tech disputes, would have very serious impacts on Australia’s economy.

As Foundation Chairman, Jock Murray AO, noted in opening the dinner, as Australia is a maritime trading nation and a net capital importer, the maintenance of an open, global trading regime is a matter of survival for an economy such as Australia’s.

This theme, of how to sustain global openness, of ensuring that the world is unified rather than fractured into trading and related blocs, is at the centre of the agenda for the Global Foundation’s upcoming London and Paris Roundtables, to be held on 19 & 21 June, respectively.

For some years now, working with its global networks and roundtable series, the Foundation has continued to escalate the case for a form of ‘co-operative globalisation’ and for a ‘dialogue between civilisations’, between East and West, such that tensions are de-escalated and that the global common good is able to be sustained and not weakened.