Wednesday, 10 June 2020
Joint Standing Committee on Trade and Investment Growth; Report
On behalf of the Joint Standing Committee on Trade and Investment Growth, I present the committee's report, incorporating a dissenting report, entitled Trade transformation: supporting Australia's export and investment opportunities.
Report made a parliamentary paper in accordance with standing order 39(e).
by leave—I move:
That the House take note of the report.
Can I say that trade and investment are essential to the economy of the nation. Tens of thousands of Australian businesses, from sole traders to large enterprises, export both goods and services right around the world. Investment has underpinned the growth of many Australian industries and has enabled businesses to expand, diversify, hire new staff and enter new markets. This inquiry considered opportunities for Australian businesses to increase their exports and to attract further investment. In particular, the committee examined what role the Australian government had in boosting exports. The committee considered what challenges businesses face when exporting, such as non-tariff barriers and also unnecessary and burdensome regulation, both federal and state. The committee's report makes some 20 recommendations that are all aimed at supporting businesses, including in new and emerging industries, to increase their trade and to attract investment. There is one very important reason for that, and that is jobs—the growth of local jobs on the back of exporting.
The committee recommended in particular an assessment of the regulatory arrangements that we have at state and federal levels for the agricultural sector. This includes a recommendation for an examination of red tape and green tape, and whether the regulatory costs and the regulation itself in the different jurisdictions we have around the country are impacting on our nation's competitiveness internationally when it comes to agriculture. This is very important because this government has a very strong target for the growth of agriculture. We want to see it boom. We want to see it lead the way for jobs growth in this nation by 2030. Some of the submissions we received to the inquiry cause me to believe that, in particular, there are state regulations that are inhibiting the growth of agriculture. We certainly received some feedback from the sugar industry to that effect. I come from a sugar area, and I know quite well that there are the so-called reef regulations that are inhibiting the growth of the industry. We received feedback from the seafood industry as well—concerns around restrictions on wild catch quotas which seem to be based on 'non-scientific evidence'. This is all restricting the growth of agriculture as the country wants it to grow. It's also restricting jobs in agriculture.
Another focus of the committee's recommendations was supporting innovation in new and emerging industries, including the space sector, defence exports, international health and video game design—an interesting one. The committee also looked to the future of Australian trade and investment, including the government's goal of having 90 per cent of all of our two-way trade covered by trade agreements by 2022. That's a significant and ambitious target. Achieving that goal will be something of a milestone. It raises the question: what opportunities will there be to drive further growth in new markets in Australian exports? Certainly diversification was one of the key factors that emerged from this inquiry—not putting all of our eggs in the one basket. We have seen quite recently what can happen when you do that.
One of the recommendations which I know has caused some dissent—and certainly the deputy chair will speak to it—is around business tax arrangements. We as a committee resolved that we support the continuation of the government's agenda on driving down business tax breaks. That's important because it's an inhibitor on growth. We live in a global world. We live in a world where there is competition. When you have lower business tax rates around the world, you are hampering Australian businesses. That costs jobs and wages. We have one of the highest business tax rates in the world, at 30 per cent. The global average is under 24 per cent. The OECD average is just over 23 per cent. In Europe it is under 20 per cent. In Asia it is around 21 per cent. In China it is 25 per cent. Through data they have collected, Treasury has shown us that business tax cuts would lead to more employment and wage increases. That's certainly something that was reflected by submitters to the inquiry and people who came before the inquiry, including the Business Council of Australia and the Australian Investment Council.
As this inquiry was coming to a close, the world was confronted with the coronavirus pandemic. This has had already devastating consequences for individuals, for families, for businesses and for economies, not just here in Australia but right around the world. The long-term economic impact of COVID-19 is not yet known, but the government is putting measures in place to support businesses after this crisis has been overcome.
As the majority of the evidence to this inquiry was received before the pandemic, before the outbreak, the report actually does not reflect the emerging challenges that businesses around the globe will face as a consequence. However, the recommendations of the report, which focus on creating more opportunities to export and invest, remain relevant and necessary as the economy looks towards recovery in the coming months.
On behalf of the committee, I would like to acknowledge the difficult times that many businesses around Australia and workers are experiencing as a result of the COVID-19 pandemic. It's our hope that the work of the Australian parliament, through this committee, will help businesses recover from the effects of this pandemic.
I would like to thank not only the other committee members, some of whom are present in the chamber, and the secretariat, who did a lot of hard work in helping us come to the report that we've tabled today, but also those who submitted—the individuals, the businesses, the organisations, the government departments and agencies who participated in this inquiry and provided the committee with an insight into the trade and investment challenges and opportunities for Australian businesses. I would also like to thank my committee colleagues once again for the significant contribution that they made to this inquiry and the ongoing work of the committee more broadly.