Kevin Hogan (Page, National Party, Shadow Minister for Trade and Tourism) Share this | Hansard source

I move:

That this House:

(1) notes:

(a) the importance of providing appropriate protections for Australian businesses investing overseas; and

(b) that Australia has negotiated Investor State Dispute Settlement (ISDS) clauses over the past 30 years in investment treaties and free trade agreements;

(2) acknowledges that Australian companies investing in foreign countries have used ISDS clauses to protect their investments from being taken over by foreign governments;

(3) recalls that:

(a) free trade agreement negotiations came to a standstill under the Government of Prime Minister Gillard arising from the refusal to include ISDS clauses in these agreements; and

(b) it took the re-election of the Coalition Government to get Australia's trade policy back on track; and

(4) recognises that the current Government's decision to once again scrap ISDS clauses in new free trade agreements and renegotiate them in existing ones shows that the unions are controlling the Government and putting Australia's trade gains at risk.

Before I get to the specific things about ISDS clauses and why they're not scary things—they're things that we should be happy to negotiate with someone or another country when we are doing free trade agreements with them—I want to talk more generally about the golden goose that trade literally is and put that in the context of ISDS provisions and other things.

Deputy Speaker, you may be aware that global trade, measured in US dollars, has gone from something like US$6 trillion to the mid-20 trillions. So it has more than tripled over the last two decades. During the same time that global trade has taken off and many more countries have become involved, realised their specialty in trade and got into that world, the rate of global poverty has gone from 30 per cent of the global population to 10 per cent. I put it to you that those two are integrally related. As countries start to open up, they trade, work out what their natural advantage is—whatever it may be—and become more wealthy. That obviously is a good thing.

Why is it a good thing? It's obviously good financially for those communities, people, families and countries. But what also happens is that, as a country gets richer and gets to a certain level of GDP wealth net per person, they start to become more environmentally sensitive and more environmentally aware, and things like labour laws get better. If we go way back, a country like Japan, post World War II, started off with a low-wage advantage. But they have evolved, through being an open, trading economy, and their natural advantage is now high tech or whatever—not low wages. It's a good thing environmentally, and it's a good thing for employees, as a country gets wealthier and starts trading.

In relation to Australia—and I'll give a bit of credit here to the Hawke and Keating governments of the eighties, who started to talk the trade case—when we came into government in 2013, 20-odd per cent of our goods and services were covered by free trade agreements, and, over the nine years we were in government, that increased to nearly 80 per cent, with the deals done with the UK and India. What has that meant for Australia? That has meant a lot of positives. That has meant that one in four jobs in Australia is related to the export sector. Jobs in the export sector pay higher than more domestically focused jobs. So, in Australia, it has been a wonderful story as well.

The reason I put that forward, in explaining why I've brought this private member's motion today, is that there has been, probably in the last two or three decades, a similar theme from both sides of politics about the benefits of trade and the importance of trade. But where I think there's starting to be a bit of a discrepancy in that theme is in the statement by the new government that they would review the ISDS provisions in some of our free trade agreements. I'm going to go into that and some of the other things that they're starting to talk about, which I think put at risk the bipartisan agreement we have on some of this stuff, and, in some cases, I think they're putting the cart before the horse.

It doesn't happen all the time, but there have been a number of countries that have requested that an investor-state dispute settlement provision be put into a free trade agreement. For a country like Australia, it's not a big deal because we are a transparent country. We follow the rule of law and we're transparent in the way we do things in our legal system as well. I think there's been one court case where someone took us, as a country, through that process, and we won that case. Again, it wasn't necessarily a major deal. However, if we are to go to some countries and say, 'Those provisions need to be removed,' that puts at risk the free trade agreements we have with those countries. Some of them are major trading partners, and those free trade agreements have brought great benefits to our exporters. That's why this is an important point to talk about.

The other thing is that the new government is starting to throw in other things, especially in relation to some of the developing nations who need to get trading and who will then become more environmentally conscious and better with their labour laws. Some countries and the Labor Party are talking like this. They want to throw a whole lot of conditions on everything right now. They want all these environmental outcomes and all these labour law outcomes. There are some very important environmental outcomes that we as a globe have to achieve. That should be handled within COP and other environmental institutions and programs. That is the way you do that. There are also labour programs where you can talk about this thing. The Labor Party should not kill the trade goose that laid the golden egg.

See this speech in context