Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Hansard source

By coordinating our international policies to complement changes in our domestic policies, we solve common problems and hindrances to trade and investment opportunities. Given the importance of trade to our economic prosperity, it is critical that our bilateral agreements are updated with our partner states to meet the challenges of changing domestic policies. This is essential to our trade policy approach. We have to ensure that Australia is productive enough and competitive enough to take advantage of our market access gains.

I would like to bring to this debate some important information that was raised with the release of an independent report into Australia’s export policies and programs. The Mortimer review, as it is colloquially known, was conducted by David Mortimer AO and Dr John Edwards. The International Tax Agreements Amendment Bill (No. 2) 2008 reflects the sentiments in section 4.6 of the Mortimer review:

The review received a number of comments from stakeholders on Australia’s current system for taxation of overseas income. Many argued that the system has failed to keep pace with the changing nature of our trade and the internationalisation of business and that its complexity often leads to inadvertent evasion of tax.

The Mortimer review recommended that there be a concerted effort to strengthen coordination and delivery of trade policies and services. This bill is indicative of Labor’s commitment to provide a strong voice for business in developing trade and investment priorities and programs and to secure growth in Australian trade group bilateral agreements.

We have signalled a broadening of our export base, with a strong focus on services and investment. This commitment to refocus Australia’s trade policy is paramount, laying the foundations for our future prosperity. It is imperative that Australia secures trading opportunities, due to the failure of the previous federal government. Under the previous government, despite the resources boom, net exports made a positive contribution to economic growth in just two out of the 11 years they were in office. That is right: two out of the last 11 years in office. This has led to the increase in our net foreign liabilities. It is in Australia’s best interests that bilateral economic and trade relations with South Africa continue to grow.

The majority of the deterioration of Australia’s trade balance under the previous government was in the last five years, when they had the benefit of a major resources boom and very favourable terms of trade. I think the previous government really missed an opportunity to further develop Australia’s trade opportunities.

We have an opportunity now to make sure that protocols are in place to reduce barriers to bilateral trade and investment and to lower withholding tax rates on interest and royalties for Australian business and investment. This government will not miss these opportunities. We must take these steps to redress the failings of the previous government. We must take steps to redress the 72 consecutive trade deficits that we inherited from the previous government.

This is trade reform which is very important for our continued growth as a community. We, as a nation, are competitive enough and productive enough, I believe, to take advantage of the opportunities that this bill presents. An increase in exports will be necessary to stabilise net foreign liabilities and to avoid a potentially painful readjustment process in the future. The challenge is not only to take advantage of the opportunities but also to help secure economic growth in a sustainable way for our overseas and bilateral partners. It is vital that we secure our international business culture in this country to improve our performance. It is vital that we take the lead in the trade liberalisation agenda with our international trading partners. Our region can become a very substantial economic powerhouse within the global economy. Fundamentally, it also means that we have to diversify our trade base to harness much more of the huge potential that this nation has, to provide, in the long run, benefits to consumers and to build stronger relationships with our trading partners.

It is imperative that we get the frameworks right, boost economic growth and set the nation up for sustainable prosperity beyond the resources boom. This is a new era of economic reform. In just 12 months we have already made a huge down payment on our commitments to improve Australia’s trade performance. We have a strong resources and agriculture base. These are the things we share strongly with South Africa. But a strong resources and agricultural base will not solely support us in the long term, and the failures of the previous government in providing long-term structural trade policy must be reversed. We are taking those opportunities. The challenge for us here is to take up those opportunities and really deliver for our nation. Let us secure a strong economic growth for our future. This bill does that, and I commend it to the House.

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