- content / uploads / chief - scientist - submission - to - senate - inquiry - intoaustralias - innovation - system1. pdf ; and ceda ( 2013 ), “ australia adjusting : optimising national prosperity ”, november. available at http : / / www. ceda. com. au / media / 338287 / cedaaustadjusting _ web. pdf. bis central bankers ’ speeches responsibility for the g20 now passes to turkey. we can bask in the glow of success for a few weeks and then get on to other matters. the point simply is that this has gone well as a result of the determined efforts of a range of people who were clear about what they wanted to achieve and who mobilised the necessary resources and effort to get there. one other result of australia ’ s leadership of the g20 is that the whole issue of infrastructure is well and truly on the table. no one doubts the need for infrastructure provision and it has clear economic attractions. spending on infrastructure supports aggregate demand during construction but, if done well, also augments the economy ’ s supply capacity for the long run. it is also clear from the various discussions over the past year that there is not a shortage of capital in global markets to fund infrastructure projects. the issues to be overcome don ’ t include finding the money. they concern appropriate project selection criteria, long - term planning, governance, contract design, appropriate risk sharing between public and private sectors, pricing usage of the infrastructure and so on. there is an opportunity here, including for australia, to do something of value over the years ahead. of course, we will need to be serious and to put in the effort over an extended period – in all the above areas. if we don ’ t put in that effort, not much actual infrastructure will be delivered. but if we are serious, a lot could be achieved. i imagine that the committee for the economic development of australia would be keen to be involved. conclusion i have reached the limits of our time this evening. australia ’ s economy is continuing to grow, moderately. it has been responding in ways you would expect to the remarkable set of circumstances it has faced over the past decade. there is continuing adjustment ahead and doubtless no shortage of challenges. but beyond these challenges of the next couple of years, maximising our economic possibilities in the modern world requires sustained efforts at adaptation and innovation, at doing things better and, perhaps most of all,

glenn stevens : economic possibilities address by mr glenn stevens, governor of the reserve bank of australia, to the committee for economic development of australia ( ceda ) annual dinner, melbourne, 18 november 2014. * * * i thank elliott james for assistance in preparing these remarks thank you again for inviting me to address ceda ’ s annual dinner. tonight marks the fifth time i have done so, and it continues a long tradition. my first venture to your gathering in 2006 talked about the role of finance in economic development. an important part of the story was that, through history, financial development and innovation went hand in hand with the extraordinary growth in living standards that flowed from the industrial revolution. another part was that financial development did not come without its risks, which on various occasions in history had materialised in damaging, or even devastating, fashion. in 2006 we were talking, among other things, about the rise in debt of australian households and the various risks that might accompany that. we had had a “ stress test ” focused on such issues, conducted as part of the international monetary fund ’ s financial sector assessment program. the results had been pretty good actually, but we were not sure how reassured we should be by them. and we talked about an increase in risk - taking in certain parts of the corporate sector that was occurring at the time, and wondered how that would all turn out. we didn ’ t have to wait long for answers to those questions. the next time i came to ceda in 2008 the global financial crisis had erupted and the global economy and financial system were facing their darkest moments since the 1930s. the g20 leaders had just met in washington and taken the first steps towards putting the global financial system back on a sound footing. by then economic growth in australia had already begun to moderate, but we feared a much more significant slowing could be in prospect. confidence was shaken and, understandably, households and businesses became much more cautious about spending, taking on more debt, or investing in a new process or idea. the deteriorating global outlook also led to large declines in asset prices and the prices of commodities important for australia. the feeling at the time was that the terms of trade, which had risen substantially as prices for minerals and energy had reached very high levels, had probably peaked. the falling terms of trade were expected to subtract noticeably from growth in national income over the subsequent period. it ’ s a matter of record that, due to a combination of factors, australia ’ s