Jason Clare (Blaxland, Australian Labor Party, Shadow Minister for Communications) Share this | Hansard source

Indonesia is our next-door neighbour and it is a big and important neighbour. It is home for more than 250 million people. In population terms, that means it is the fourth biggest country in the world. By the middle of this century, it will be the fourth biggest economy in the world, sitting only behind the United States, China and India. But, at the moment, trade and investment with our big northern neighbour is massively underdone. Indonesia does not even register on the list of top 10 trading partners for Australia. We trade more with New Zealand, a country of less than five million people, than we do with Indonesia, a country with a population of 250 million. The comparison is stark. There are more than 12,000 Australian companies currently doing business in New Zealand and there are less than 300 in Indonesia—12,000 Australian companies doing business in New Zealand, a country of 4.6 million people, and only 300—or fewer than 300—Australian companies doing business in Indonesia, a country of 250 million people. This is what I mean when I say that our trade and investment relationship with Indonesia is massively underdone, and why the free trade agreement which is being currently negotiated between our two countries is so potentially important.

That agreement has the potential to provide the foundation and framework to increase trade and investment between Australia and Indonesia and to make the most of the enormous growth that is expected to occur in this economic juggernaut in the decades ahead. Just one statistic gives you an idea of the potential opportunity that awaits us in Indonesia. Indonesia's a young country. The median age in Indonesia is 28.6—in other words, more than half the population is under 30. By 2030, 70 per cent of Indonesians will be of working age. That means about 130 million to 135 million potential consumers and a market worth almost US$2 trillion. Our challenge here, as we look at this opportunity, is how we build the foundations now between our two countries that will help to make sure that, as Indonesia grows in the decades ahead, it also creates more jobs here and more opportunities here at home for Australian businesses. If we do not, then other countries will—other countries in Europe and in North and South America. The opportunity is enormous and it is up to us to make the most of it.

The free trade negotiations between our two countries kicked off about seven years ago. They kicked off under the former Labor government. They were initiated by Julia Gillard and by President Susilo Bambang Yudhoyono in 2010. We understand now that these negotiations are reaching a conclusion. The Prime Minister of Australia and the President of Indonesia made a commitment in Hamburg at the G20 that they would seek to finalise free trade negotiations between our two countries this year. We look forward to seeing the details of that agreement when it is finalised and we hope that the government can forge a high-quality agreement, because the opportunities here are so great, in particular for Australian farmers, for Australian universities and other education providers, for the tourism sector, as well as for increased investment in both directions.

We will wait to see the details, but one of the interesting features of these negotiations has been the role that business has played so far in helping to focus negotiations and identify the opportunities that are available here. The Indonesia-Australia Business Partnership Group was established in 2011. It is made up of business peak bodies from our own country and Indonesia. It includes the Indonesia Australia Business Council. It includes Asosiasi Pengusaha Indonesia, otherwise known as APINDO. It also includes the Australian Chamber of Commerce and Industry and the Ai Group. They've done a lot of important work in identifying the opportunities to increase trade and investment between Australia and Indonesia and also in identifying some of the impediments and providing advice on how they could be overcome by this agreement. This is not something that happens with all of the free trade negotiations that Australia undertakes. It is unusual to have business leaders from both countries do this sort of work. I think it is constructive and extremely valuable. Hopefully the agreement that's signed later this year will be the better for the work that these business organisations have done.

There are a number of other issues that I also hope this agreement addresses when it is finalised later this year. Some of them were picked up in this report. This report that we are debating here is a report of the Joint Standing Committee on Trade and Investment Growth. The committee were asked by the government to inquire into Australia's trade and investment relationship with Indonesia, and they have made a number of what I believe are very important recommendations. One of them is a recommendation that this agreement, the free trade agreement with Indonesia, should not waive labour market testing. I agree. Labour market testing is a pretty simple concept. Before a company can bring in a temporary worker from overseas, they should first have to check and see if there is an Australian who can do the job. Waiving that in this agreement would mean workers from Indonesia can come to Australia without the company they're going to work for first having to check if there's an Australian who can do the job. This is the sort of stuff that makes our constituents angry. It's not protectionism; it's just common sense that, before you bring in an electrician, a carpenter or a plumber from overseas, the company seeking that person to do the work should first have to go through the basic task of seeing if there is an Aussie who can do it. The report recommends that the free trade agreement with Indonesia does not waive labour market testing. We agree, and we hope that the government do too. From the contribution we just had from a member opposite, it's doubtful that they will. It also indicates that they just don't get it: they just don't understand how simple a concept and how important a concept like labour market testing is to the Australian community.

The report also recommends that the final text of the agreement should be accompanied by independent economic analysis conducted by the Productivity Commission or an equivalent organisation. This is just another sensible, practical but important recommendation. It's not a new idea. The Australian Chamber of Commerce and Industry has recommended this before, as has the ACTU. It has also been recommended by a number of committees in this place: the Joint Standing Committee on Treaties, the Senate inquiry into the Trans-Pacific Partnership and the Senate Standing Committee on Foreign Affairs, Defence and Trade's review of the treaty-making process in 2015.

The important point here is that public scepticism about trade, open markets and globalisation is real and increasing. You see evidence of it in the election of Donald Trump last year, in Brexit even and in the rise of Hansonism and the vote that One Nation got at our last national election. This sort of independent economic analysis of a trade agreement, once it's struck between our two countries, helps to respond to these sorts of concerns. That's important because public trust, public faith, public confidence and public support for free trade and open markets is important. One in five jobs in Australia is directly related to trade. More trade means more jobs and more high-paid jobs. We need to be able to say, when we are debating a free trade agreement, that we know—not just because the government says so, but because the independent analysis proves it—that this is going to provide a meaningful, real benefit and more jobs for Australians.

I hope that the government listens to this recommendation and implements it not just here but in the other trade agreements it is negotiating. This is a good report, and it's a bipartisan report. It's not just the Labor members on this committee that have recommended that this free trade agreement with Indonesia not waive labour market testing and should be subject to the scrutiny of independent economic analysis—the government members have too. Both sides have said this. Unfortunately all the evidence to date, and we just heard it again, indicates that the government is going to ignore its own members and the recommendations in this report. If it does that, it will be a mistake. The free trade agreement with Indonesia, currently being finalised, is an enormous opportunity for our two countries. We shouldn't be afraid of independent analysis of it, and we shouldn't have to trade away the right of Australian workers to get the first crack at a job before overseas workers in order to get a great deal done.

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