“While Mr Trump’s victory in the US Presidential election introduces new uncertainties – particularly in relation to trade and the global economy – the risks to Australia should not be overblown,” Australian Industry Group Chief Executive, Innes Willox said today.
“There are some clear positive signs from the election outcome – for example in the commitments to increase infrastructure spending and to stimulate the US economy with tax and other pro-growth policies.
“On some of the specific issues of relevance to Australian business, the end of the Trans Pacific Partnership (TPP), which became a bipartisan position over the course of the election campaign, is disappointing rather than disastrous. We already have a Free Trade Agreement with the US which is not under threat and we have FTAs with many of the other countries interested in joining the TPP.
“On climate policy, the implications are far from certain. The US has ratified the Paris Agreement and if it decides to withdraw this may take years. Even without the US, the Agreement would still have very widespread coverage.
“Perhaps the most important take-outs relate to broader questions about the management of economic transition and the importance of building a more inclusive approach to economic and policy change. Critically, the US election result shows that you cannot airily wave goodbye to big parts of industry without expecting political repercussions.
“And it shows that long periods of real wage stagnation for large sections of the community and rising inequality of income will generate disenchantment with political and economic systems.
“While Australia has a far stronger social safety net and more actively embraces income redistribution than is the case in the US, nevertheless there are significant parallels here and there are important messages for how we in Australia approach our own economic transitions.
“There are massive changes afoot in our industrial structure; in the way we work; and in the way we do business, and we need to recognise that government and business have responsibilities to bring the community along.
“People are hurting and are not convinced that the economy and the political system are delivering for them. They have concerns about their jobs and opportunities for the future and they do not like being taken for granted. Put simply a lot of people are not confident that the trickle-down argument works for them.
“This does not mean that we walk away from change; it is more a question of how change is managed. It also further emphasises the importance of investing more to equip people to participate in the higher-skilled workforce that we need for the future.
“There will be endless analysis of the US election outcome and the risks it presents. But there are also opportunities from what is a huge change to the global political landscape and messages for business and policy makers that cannot be ignored,” Mr Willox said.
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