The Venice Biennale is the biggest show in town, in any town. Of all the international biennials and triennials that showcase contemporary art, it is the oldest, the grandest. Established in 1895, the year before the modern Olympics (it is often said that the Venice Biennale is to art what the Games are to sport), it was the product of 19^th-century hunger for global interaction – one sign of modernity that apparently never wanes.

This 120^th anniversary marks the 56^th time Venice has staged the Biennale Arte. It is now more a festival than an exhibition, swollen past the Giardini on the eastern edges of Venice, with its suite of 29 national pavilions, and the nearby 16^th-century Arsenale, headquarters of Venice’s once-mighty navy, into a city-wide flood. From the Cannaregio district to the islands in the lagoon, from the Punta della Dogana art museum to baroque palazzi on the Grand Canal, art (official or otherwise) is everywhere. Only the truly dedicated see it all.

So what is the Venice Biennale today? An unseemly jostling for prestige by national competitors, both powerful and aspiring? Anachronistically, prizes are still awarded: Armenia won the coveted Golden Lion for best national pavilion in the 100^th year since the Armenian genocide, the Ghanaian-born sculptor El Anatsui the lifetime achievement award. Is this more than a tawdry array of competing artists, exhibitions, curators, gallerists and hangers-on, all trying for fame and fortune, sales and deals? Some say no – and Venice does bring maximum exposure and huge sales, as 30,000-plus professionals and collectors (including a shoal of Australians) surge into the three-day vernissage (preview) before the exhibition opens. More importantly, is the Venice Biennale still a really big conversation in contemporary culture, a defining moment when agendas are reset and future possibilities considered?

It’s all of the above, always, and contradictorily so. But this year, under the leadership of Nigerian-born uber-curator Okwui Enwezor and titled All the World’s Futures, it is emphatically the latter: a powerful persuasive multi-vocal conversation. Not without difficulty. Here the old-style international expo meets the statement exhibition of a single curator head on, and parochial, often mysterious, choices made for national pavilions encounter the broad themes of the curated show. This conjunction can get awkward, sometimes interesting: in the Arsenale, Enwezor’s core exhibition butts up against Charles Lim’s meditation on Singapore’s maritime history and South Africa’s packed group show that includes a devastating video about the Truth and Reconciliation Commission. Navigation is always challenging in Venice.

Despite the independence of the national pavilions, Enwezor has put his stamp on the entire messy ensemble. His All the World’s Futures exhibition makes sustained claims for art’s continued social, even political, relevance. “Political” is always the red rag to the bull. In certain circles, especially in the US, it’s shorthand for the art of commitment that abandons ancient ideals of beauty and transcendence. Some critics immediately rejected the 2015 exhibition: Australian-born critic Benjamin Genocchio called it “the most morose, joyless, and ugly biennale in living memory” but also the most curatorially rigorous in 20 years. Yet in some radical circles, no artistic program, however critical, can effectively counter the organised cupidity and insider politics of the system.

Enwezor’s Biennale has separated visitors into two camps: lovers and haters. I’m in the former. One of the most influential voices in contemporary art, Enwezor has staged a Biennale that is provocative and abrasive, even angry, but also engaging and humane. Key themes, signalled by the continuous reading of Marx’s Das Kapital in the new Arena at the main pavilion in the Giardini, are power, labour and inequity. Why Marx? Provocation aside, what else stands as a foundational text for the modern period? Kapital leads into the exhibition’s exploration of what is happening now, with the world’s exploited labour, mass migrations, historical and inherited injustices. The aim is to see the state of things, in Enwezor’s often repeated italicised phrase, in order to move forward. It’s an enormous program, a huge ask.

It mostly works. In my view, Enwezor’s exhibition, which he orchestrates with enormous energy, is far better at the Arsenale than at the Giardini. From Bruce Nauman’s text-based neon sculptures denouncing American violence paired with Algerian-born Frenchman Adel Abdessemed’s clusters of machetes, this is a no-holds-barred investigation of power, but also resistance. The exhibition is aggressive, certainly – one of the main complaints – but I find this exciting, percussive, theatrical. Terry Adkins’ sculptural appropriations of the spirit (as much as the substance) of musical instruments lead into the recurrent beat of music and song throughout the exhibition: Sonia Boyce’s rap/opera encounter set in London’s Victoria and Albert Museum; Carsten Höller’s two-channel video of a song contest in Kinshasa – two rivals and 150,000 baying supporters; Charles Gaines’ exquisite song texts or Jeremy Deller’s British workers’ songs. The whole exhibition clangs, thrums.

Artists from the world’s diasporas steer All the World’s Futures: Australian Daniel Boyd is showing magisterial paintings based on the Marshall Island star maps of his forebears; a magnificent documentary film by Korean Im Heung-soon examines the plight of migrant workers across Asia; Harun Farocki and Antje Ehmann’s video Labour in a Single Shot captures the sheer variety of work across the globe. Importantly, and this has been Enwezor’s historic role over the past 20 years, the exhibition features many artists from Africa, often first-time exhibitors. Leading artists from the African diaspora include Adrian Piper, Melvin Edwards and Theaster Gates from the US, and British stars Isaac Julien, Chris Ofili, Steve McQueen and the sublime John Akomfrah. The point is the histories, narratives and perspectives these artists bring to “international art”. For me, this was extraordinary. And if some works are angry and uncomfortable, so be it.

Among all this violence and flux, All the World’s Futures is anchored by mini-surveys by beacon figures as various as Robert Smithson, Hans Haacke and Georg Baselitz. Emily Kame Kngwarreye, the late Aboriginal painter, is represented by one immense, joyous canvas, suggesting openness to a world of artistic practice. There are also, importantly, many positive, even tender, portraits: Liisa Roberts’ photographs of elderly Russian workers, once models for heroic Soviet art; Chris Marker’s Passengers (2011), made in the Paris Métro the year before his death; Olga Chernysheva’s observational drawings laced with humour; the entire set of Walker Evans’ photographs from Let Us Now Praise Famous Men.

The disquiet with Enwezor’s Biennale leads to this question: what is the purpose of art? The outer reaches of engaged art are perplexing. City authorities closed down the notorious Icelandic pavilion, which installed Venice’s first mosque in a disused church in Cannaregio, claiming it was a security hazard and the artist hadn’t obtained the proper permits. On the sunny Sunday I visited, the mosque was peaceful, even mundane. Too much so for some: the argument turns on whether the convergence of religious observance and artistic practice is acceptable, though, ironically, different responses from religious and secular sides often tend to come to the same negative conclusion. One thing is certain: the Icelandic and Venetian Muslim communities were happy with the experiment.

And Australians in this global mix? A record number of Australian artists are exhibiting across Venice. Enwezor folded five individuals and the partnership of Sonia Leber and David Chesworth into his core exhibition, the Australians participating in the wider conversations. Newell Harry’s sensational anagrams on long tapa scrolls, calling to other diasporic histories, are installed near works insisting on the dignity of personal, often handmade, objects and communications; Emily Floyd’s sculptures, an anatomy of labour and knowledge, are sited in a magical garden in the furthermost reaches of the Arsenale – it’s well worth the hike; Leber and Chesworth’s operatic video evokes the legacies of Soviet revolutionary aspirations; and Marco Fusinato’s invitational work joins a chorus of interaction and collaboration, from Adrian Piper’s piece that asks viewers to sign crisp contracts with themselves to Oscar Murillo’s drawing project with dispersed communities of children. Here Enwezor is following other international curators working with Australian artists, but because it’s Venice, and his themes of diaspora and immigration are so pertinent to this country now, it’s especially significant.

Let’s return to the national pavilions. My picks? Sarah Lucas, survivor of the Young British Artists movement, for Great Britain, with an ensemble of mutated phallic sculptures modelled on balloon figures and cast into acrylic. The interior of the grand old pavilion was painted yellow to make the point: you can’t overlook this. I loved the disturbing motion-capture video by Hito Steyerl at the German pavilion, and revelled in Canada’s excessive Canadassimo, by Montreal collective BGL, a meditation on ways of living that is perhaps as much an allegory of making. And I do not think I have ever seen a more thoughtful, even poignant, architectural intervention than Heimo Zobernig’s refashioning of Austria’s 1934 Josef Hoffmann pavilion. Many national pavilions – the US, Japan, Australia, Great Britain, Germany, Sweden – feature female artists. That tide finally seems to be turning.

In the city, New Zealander Simon Denny’s Secret Power evokes contemporary governmental surveillance in the 16^th-century Marciana library: newer forms of power are superimposed over old ones. In a remarkable gesture of amity, India and Pakistan are sharing an exhibition; Shilpa Gupta and Rasheed Rana, known in Australia through the Asia Pacific triennials and other outings, speak to the difficult legacies of partition. And Australian Mike Parr, in a distinguished installation in rooms at the top of the Palazzo Mora, looms like the original bat in the belfry.

This brings us to the Australian pavilion. Fiona Hall’s Wrong Way Time is a complex exploration of mortality and the consequences of human action in, and on, the world. Her installation is perfectly attuned to the big-picture questioning of the 2015 Biennale. On entering, one immediately confronts a finely wrought aluminium skull, a memento mori setting the prevailing mood of warning but also, as curator Linda Michael notes, the joyous affirmative inventiveness embodied in Hall’s work. In a Wunderkammer jam-packed with new and existing work, Hall ranges from sardine cans to painted tapa, from shredded US dollar bills to carved bread, from bronze to driftwood. A flock of painted-up cuckoo clocks gave the installation its title, filling the pavilion with concatenating tick-tocks.

All this is dazzling, confusing, confounding. Hall’s art demands close attention to its fine grain – this is not 30-second-take art. So much the better. But these proliferating ideas, media and techniques cohere through the reiterated environmental warning – it’s as if Earth’s biological clock is ticking. A corral of museum display cases present human knowledge in a variety of its forms, from cast Platonic solids and crystals to newspapers, encyclopaedias and maps. What of the inclusion of collaborative works with the Tjanpi women of remote South Australia, which has inspired much social-media chatter about tokenism and complaints about how rarely indigenous artists have shown in the Australian pavilion? I was troubled by the awkward placement of the work, in a corner, but I see why Hall prizes the insights of the Tjanpi women, their experiences from Maralinga to the present, as an essential part of the whole. For Hall, everything in the universe is interconnected, and she clings resolutely to her sense of its totality.

This year is notable for the opening in the Giardini of the much-heralded permanent Australian pavilion, which replaces Philip Cox’s 26-year-old “temporary” structure. Melbourne architecture firm Denton Corker Marshall has found an elegant solution to the cramped sloping site, reorienting the building towards the water and providing approaches along two pathways that converge on a ramp leading to a generous deck. The pavilion is almost square, completely unadorned. Externally it is monolithic, except for large panels that can open to admit natural light, two extending the building’s cantilever over the Rio dei Giardini, the little canal at the back of the gardens. Strikingly, the pavilion is black, clad in granite, where the majority of the Giardini’s Art Deco buildings are white. It’s a fine decision: the Australian pavilion stands out. And it speaks to its setting: the granite takes dancing light off the canal, shadows cast by the overhanging trees.

Internally, it’s the modern art exhibition’s classic “white cube”. The pavilion is unassuming and supremely art-friendly, its mix of simplicity and practicality the envy of other exhibitors. Anything can be built inside its shell: that’s the point. It is “state of the art”, complete with computerised systems and the myriad services required for contemporary art media. (It will also host Australian participation in the architecture biennales.) As it happens, Fiona Hall immediately subverted Denton Corker Marshall’s white cube: she transformed the space with her signature dark background. This pliability is a great sign: an exhibition space is always, first and foremost, a nest for art.

Securing this new pavilion has been a long and arduous process, kickstarted by the Melbourne restaurateur Rinaldo di Stasio’s unofficial design competition in 2008. Funded by a private–public partnership, led by the Australia Council, that saw dozens of Australians come to the party with a total of $6.5 million, the pavilion marks an important moment in Australia’s cultural life. Is it paradoxical to claim national cultural confidence (as Australia’s Venice Biennale commissioner Simon Mordant did in a speech to the National Press Club) through international exposure? I don’t think so. This million-dollar baby is a solid commitment to the future of Australian artists and architects, and the potential of Australians in the global arena. I see the new pavilion manifesting, in a very practical way, a sense of renewed certainty, even maturity, which was claimed by speakers at the official launches in Venice, including actress Cate Blanchett, one of the pavilion’s supporters. It’s about time.

In 1961 Truman Capote famously said, “Venice is like eating an entire box of chocolate liqueurs in one go.” Is Venice itself actually the biggest show in its own town? This is a challenging setting for contemporary culture. What can rival the city’s celebrated beauty? Its fabulous art? Its brutal history? There’s a special frisson in seeing the latest art in this sedimented setting, finding the future among the vestiges of past glory. This always brings us back to the Venice Biennale: its improbability is incomparable.

The 2015 Venice Biennale runs until 22 November; some collateral venues close earlier. See www.labiennale.org.

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