Richard Marles (Corio, Australian Labor Party, Shadow Minister for Defence) Share this | Hansard source

I rise to speak in support of the Customs Amendment (Growing Australian Export Opportunities Across the Asia-Pacific) Bill 2019 and the second reading amendment moved by the member for Brand. This legislation is the enabling legislation for the Indonesia, the Hong Kong and the Peru free trade agreements.

Australia is a trading nation. Forty-two per cent of Australia's nominal GDP is based upon trade. Since the Whitlam government it has been the bipartisan policy of governments, since the early seventies, to pursue trade—and for good reason. We are unlikely to be able to maintain the level of prosperity that we have in our country today, as well as the level of employment, if we are solely based on engaging in that with our domestic economy of 25 million people. To maintain high-quality jobs and the prosperity and the standard of living that we enjoy today, Australia needs to be a part of the global trading system; we need access to markets around the world.

When we look at Australia's trading landscape, one of the countries which stands out in a glaring way—that our trading relationship is underdone with—is Indonesia. Currently, our two-way trade with Indonesia is $16.8 billion. That compares with Singapore, where our two-way trading relationship is $27.8 billion, and Malaysia at $21.5 billion. But the difference is this: in Singapore, the population is six million people and in Malaysia it's 32 million. In Indonesia, the population is 270 million people. It is anticipated that by the middle of this century, as a result of that enormous population and that enormous potential market, Indonesia will become the fourth-largest economy in the world. So if we seek to have trade continue to play the role in our domestic economy that it does today and to use it to build high-quality jobs in this country going forward, then we must be in a trading relationship with Indonesia on a bigger scale than is currently the case.

But the Indonesian agreement, and indeed the Hong Kong agreement, also form part of Australia's engagement with Asia. This is a story which has been written by Labor governments, going right back to the Chifley government. In the aftermath of the Second World War and Australia's focus on the Pacific theatre of that war, it was the Chifley government which understood that out of the ashes of the Second World War in the East Asian time zone would grow an economic powerhouse. But, just as significantly, it was understood that it was absolutely essential that Australia find its security in Asia. This was a sentiment that was reflected in a very famous quote that was made half a century later by another Labor Prime Minister, Paul Keating, who said:

… Australia needs to seek its security in Asia rather than from Asia.

It was of course the Whitlam government which established diplomatic relations with the People's Republic of China and all that that has implied since in terms of our economic relationship with that country. It was the Rudd-Gillard government which gave us the Asian century white paper, published in October 2012, which spoke about the enormous opportunity that the rising middle class in Asia represented for our economy, as well as the strategic significance of East Asia to Australia.

But if we look at Indonesia specifically, again, it was the Chifley government which placed Australia at the forefront of supporting Indonesia's independence movement. It was Paul Keating who, in December 1995, establish the signature Australia-Indonesia Security Agreement, and it was the Rudd government which invited President Susilo Bambang Yudhoyono to this place to address the Australian parliament in March 2010. In doing so, he was the first Indonesian president to address the parliament.

On that occasion President Yudhoyono referred to the history of our relationship with Indonesia. He said:

We are not just neighbours, we are not just friends; we are strategic partners. We are equal stakeholders in a common future with much to gain if we get this relationship right and much to lose if we get it wrong.

…   …   …

We in Indonesia will always remember that Australia resolutely stood by us when Indonesia was struggling for our God-given right to independence and statehood. We remember how Prime Minister Chifley, foreign minister Evatt and diplomat Sir Richard Kirby actively supported Indonesia during critical moments of diplomacy in the United Nations—a standard collegiate with that of the Netherlands. That was one of the finest hours of our relationship, and we have had many more high points since.

Those comments spoke about how important our relationship is with Indonesia going forward. In that context, it is worth noting that the Indonesian free trade agreement, which will be enabled by the legislation that we are debating today, will be the first free trade agreement that Indonesia enters into with any other nation in the world.

Free trade agreements shape economies, and whilst it is important that we are doing this agreement it's important that the agreement is a good deal. But I would submit that this is a good deal. This will provide a reduction in tariffs for two per cent of Indonesian exports to Australia and an increase of 4,000 places in Australia's working holiday visa scheme. It's worth noting that that is in a context of 210,000 people being in Australia today under working holiday arrangements and in a context where the existing cap of 1,000 working holiday places provided to those from Indonesia is not fully subscribed at this moment, so the increase in the number of working holiday visas in Australia as a result of this agreement will be, by any measure, marginal.

But, on the Australian side, what the agreement will provide is a reduction in tariffs in respect of 25 per cent of Australian exports to Indonesia—in some cases, a reduction in tariffs from 30 per cent down to zero. In the case of Australian exports of steel we will see the reduction down to zero of a 15 per cent tariff on steel exports to Indonesia. In areas such as mining services and agriculture, commodities such as grains, sugar and cattle, and in the provision of services around education and health care, the Indonesian free trade agreement will provide much better access for Australian exports to Indonesia and, in the process, build our economic relationship with Indonesia and, in the process of that, create jobs and build prosperity in our nation.

This agreement is not exactly the agreement that Labor would have made had we been in office. We have sought a number of improvements to it, which are contained in the second reading amendment that has been moved by the member for Brand and that Labor supports—improvements which would see the labour market testing that currently applies in Australia's temporary work arrangements apply to any future providers of contractual services to Australia from Indonesia, making sure that working holidaymakers, when they come to this country, are not exploited; making sure that there is the termination of the 1993 bilateral investment treaty which has contained in it an old investor-state dispute settlement clause, which is very wide, and replacing it with the clause which is currently in this agreement, which is more modern.

In making that observation I'd also make the observation that Labor has a longstanding opposition to investor-state dispute settlement clauses in trade agreements but, given there is this clause in the agreement which is before us today, we have been seeking a commitment from the government that there be a review of that clause after five years. We've also been seeking an agreement that the Joint Standing Committee on Trade engage in an inquiry on the entire treaty-making process in our nation so that it is more transparent not only to the public but also to this parliament. We want to make sure that there is absolutely no inference whatsoever within the Indonesian free trade agreement that there would be any privatisation of Australian government services, we want to make sure that there is an enforcing of the existing anti-dumping measures within Australia and we also want to make sure that there is an adoption of independent economic modelling and analysis of future free trade agreements.

That is what's contained in the second reading amendment, but it was also contained in a letter from the member for Brand, Labor's shadow minister for trade, to the Minister for Trade on 17 October, along with a request that, in respect of the Hong Kong free trade agreement, nothing removed Australia's support for the principle of 'one country; two systems' in terms of Hong Kong's relationship and being part of the People's Republic of China. There is a response to this letter by the Minister for Trade on 21 October, which agreed to just about every one of the improvements that were sought in the letter from the member for Brand.

In that, it has to be said that this represents a very significant win on behalf of all those, including those within the trade union movement, who have been campaigning for the very best trade agreements that we can have and that Australia can enter into. As the Leader of the Opposition said, it is on the basis of the commitments that have been provided by the Minister for Trade that Labor is now able to support this legislation today.

There are a number of concerns that have been legitimately raised by many people within our community, including the trade union movement, particularly around the exploitation of those in Australia under temporary work visa arrangements. This is a real issue. There is exploitation of people on temporary work arrangements in this country today, and it is a stain on our country that that exploitation occurs. But, in saying that, this has not principally evolved as a result of Australia entering free trade agreements—although it is natural, given clauses that have existed in free trade agreements, that people are anxious about the interaction of free trade agreements with the question of temporary workers in this country. It is an issue which needs dealing with, but it is not principally a function of trade agreements. Indeed, the investment facilitation agreement of the China free trade agreement, which was the subject of much debate in this place, has seen no investor facilitation agreements registered in accordance with ChAFTA since it has come into this place and, accordingly, no temporary workers come into this country as a result of that agreement. As I mentioned earlier, the impact that the Indonesian free trade agreement will have on the number of persons coming to this country on working holiday visas will be marginal. That said, the issue, more generally, is one which needs to be dealt with.

There is, by virtue of repealing the 1993 investment agreement with Indonesia, a situation now where the investor-state dispute settlement provision within the Indonesian free trade agreement will be much better. There is no provision in this agreement which will see any inference at all in relation to the privatisation of any government services. It is worth noting that Indonesia is a signatory to the eight core ILO conventions. There is nothing in this agreement that will waive labour market testing, nothing that will undermine the Pharmaceutical Benefits Scheme, nothing that will undermine our antidumping provisions, nothing that will undermine the government regulation of public welfare or the safety of products and nothing that will undermine existing government procurement policies. There is no exemption of any person from Australian law, and there is nothing which undermines Australia's skills certification regime.

Our place in Asia is absolutely central to our future. Our place as a trading nation is absolutely essential to continued job growth and prosperity in this country. For those two reasons—supporting this legislation, which enables the Indonesian free trade agreement, the Hong Kong free trade agreement and the Peru free trade agreement, along with the second reading amendment, which has been moved by the member for Brand—it is absolutely essential to make sure that we continue to trade, that we continue to see jobs growth and that we continue to engage with our region.

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