The first pitch to the cream of Australia’s investment community gathered at the Sohn Hearts & Minds conference in Sydney on Friday wasn’t a company, but a country.
Treasurer Jim Chalmers opened the event by noting that over the course of its history it’s been used by the premiers of NSW, Tasmania and South Australia to pitch their states’ economic growth potential to an international audience.
“Well, I’m here to pitch the parent company,” Chalmers said.
Australia, Chalmers said, is an “island of security, stability and reliability in a sea of uncertainty and risk”. He urged investors to run a screen looking for countries with AAA credit ratings, economic growth in the very highest bracket compared with major advanced economies, back-to-back budget surpluses, gross debt-to-GDP in the bottom half for advanced economies, unemployment below 5 per cent, inflation about a third of its peak and strong business investment.
“If you run that screen, you only return one country: Australia.”
Having gone through three distinct economic phases – an agrarian economy in the early 1900s, an industrial economy 40 years later, and a more open phase from the 1980s, with financial services a much bigger part of the story – Chalmers pitched the beginning of a fourth phase. In this, the economy is a powered by low-cost renewable energy, innovation in areas such as quantum computing and artificial intelligence, and access to Asia, the world’s fastest growing region.
“An economy anchored by strong fundamentals, powered by cleaner and cheaper energy, propelled by digital innovation, and positioned at the heart of Asia,” Chalmers said. “In a world short on certainty, Australia is a reliable, secure and stable long position. We’re blue chip.”
As pitches go, it’s more than a little cheesy. And it won’t be the only long idea pitched on Friday that accentuates the positives and ignores the negatives.
But we certainly can’t fault Chalmers for getting in the spirit of the day. And we loved that he pointed out the first investment trust launched in Australia by Hugh Walton in 1936 had only one fee paid on entry with no high watermark, no performance fee and no management fees.
“I see all of you taking notes,” he told the fund managers in the crowd.
This article was originally posted by The Australian Financial Review here.
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