In a landmark speech setting out his government's policies, Albanese sought to allay public concern over AI, saying it could be adopted in a way that enhanced the national interest.

The center-left leader said he would meet Australia's state and territory leaders next month to discuss the proposed new laws, which would be introduced next year to build trust in AI and protect national security.

Australia had led other countries in imposing limits on social media use for children, but the challenge to shape AI in Australia's interest was greater and demanded action now, he said.

"If we hang back and stand still this will just run right over the top of us," he said in the speech at the University of Sydney.

"Our great country can be much more than a data warehouse for AI products made overseas."

Albanese's announcement comes after it emerged this week that US startup Anthropic has lobbied Australian officials to change copyright laws to assist the training of AI models.

Musicians, writers and publishers have urged the government to resist such pressure and protect their work.

Australian creative content was not "up for grabs", Albanese said.

"No company should use Australian books, music, art or news to build or train AI without the artist's control [...] anything less is theft," he said.

The new standards would set clear legal obligations for large data centers, requiring them to put more power into the electricity grid than they take out, minimizing water usage and ensuring they don't compete for land with housing.

Investment in data centers was the largest contributor to the country's economic growth in the three months to March, according to government figures.

Albanese said the government had not yet seen the impact of AI on the Australian jobs market.

"We should not treat AI as a threat to good jobs. We should use it as an instrument to create them," he said.

The government will elevate its response to artificial intelligence with a dedicated office in his department to oversee policy.

"Getting this right will enhance our appeal to international investors, by delivering greater clarity and speed for approvals, and a streamlined process for verifying compliance," he said.

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