Australia's pharmaceutical industry has welcomed the government's new White Paper, entitled Australia in the Asian Century, which forecasts that, by the end of this decade, Asia will overtake the economic output of Europe and North America combined to become the world's largest economic power.

In order to take advantage of the opportunities presented by these developments, Australia must build on its strengths and take active steps to shape its future, says Prime Minister Julia Gillard.

Among the goals set out in the White Paper are, by 2025, to raise Australia's Gross Domestic Product (GDP) per person to among the top 10 worldwide, from 13th in 2011, and for the nation to be ranked in the world's top five in terms of ease of doing business and in the top 10 for its innovation system.

"The fundamental message of the White Paper is that the Asian century will offer enormous opportunities for Australia across all sectors of our economy," said Deputy Prime Minister and Treasurer Wayne Swan. Central to the nation's success will be lifting its domestic productivity performance, and the government will provide the building blocks for this by progressing reforms and investments across five pillars of productivity - skills and education, innovation, infrastructure, tax and regulation, he pledged.

Welcoming the report, research-based industry group Medicines Australia pointed out that its members are already helping to drive Australia's engagement with the Asian region, and that further opportunities lie ahead.

"Medicines are among Australia's largest manufacturing exports to Asia, and with Australia's latent competitive strengths in this area, we have the potential to grow this significantly," said the group's chief executive, Brendan Shaw.

"We are already seeking companies like CSL, AstraZeneca and GlaxoSmithKline supplying Asian markets from their operations in Australia and, if we get the policy settings right, we can build further on these opportunities," he said.

As well as supplying items such as blood products, asthma and flu medicines to Asia, the Australian industry is also providing services such as clinical trials and health economic analysis to the Asian economies, he pointed out.

"Over the next five years, emerging markets will double their share of the global medicines market from 14% to 30% and account for most of the growth in the global market, with Asia accounting for a significant part of that. With rapid growth, rising incomes and a growing middle class, Asian markets are likely to see increased demand for prescription medicines and this provides Australian researchers, biotech companies and fully-fledged medicines companies with real opportunities," said Dr Shaw.

The challenge is to "get our policy settings right," he added. This will require programmes to boost Asian engagement and a comprehensive response to the report of the Prime Minister's Manufacturing Taskforce, published last August. This report - Smarter Manufacturing for a Smarter Australia - also called for policies to take advantage of emerging opportunities in the Asian region, and the government has pledged to issue a response to its recommendations in the last quarter of the year.

Also needed, said Dr Shaw, are predictable policies in health, intellectual property and innovation, and the development of a strategy "to put Australia more on the radar screen of the global medicines industry."