John Murphy (Lowe, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the hardworking Minister for Trade. Will the minister advise the House of the outcomes of his recent visit to China and any implications for Australia’s trade performance and economic recovery?

Simon Crean (Hotham, Australian Labor Party, Minister for Trade) Share this | Link to this | Hansard source

I do thank the honourable member for Lowe and I congratulate him for the continued interest that he takes in the importance of trade to Australia’s future. I have just returned from China, my fifth visit in the space of 18 months. The Chinese economy is the fastest-growing economy in the world. It will be that for this year, next year and, I suspect, the year after that. China’s recovery is well underway partly due to an $800 billion stimulus package which is focused on both infrastructure and consumption. This not just is important for our resources sector, as important as that is but also provides exciting new opportunities for our economy in the areas of green building activity, automotive, agribusiness, financial services and education services.

There is now a growing view amongst analysts that China’s growth will exceed the forecasts. And if anyone wants any evidence of this, in the first quarter of this year compared with last year, China car sales were up six per cent and retail sales were up 16 per cent—that is on the consumption side—and fixed asset investment was, overall, up 29 per cent and infrastructure was up 100 per cent. This is truly a powerhouse economy reactivating itself. In the midst of this global recession, Australian exports to China increased 48 per cent in the 12 months to March. China helped propel our second highest trade surplus, $2.5 billion according to the figures released last week, now the eighth in a row, despite the global financial crisis. This surplus represents a remarkable achievement in the midst of the global recession and one with which few other economies can compare. For that, China has been a major contributor.

Our approach in terms of developing the opportunities further is a two-track approach. One is, of course, to try to conclude the free trade agreement at the national level and, secondly, to go to regional parts of China, all of them diverse and all of them growing at different rates, to develop relationships on a region-by-region basis in terms of commercial activities. I believe also that, if this is done properly, the second track can energise and put upward pressure on the first track.

That is the positive opportunity that we have to exploit. What we do not want is the reckless opportunism that has been demonstrated by the other side of this chamber. Quite frankly, China is the place to be. Australia has to get a greater part of the action and we have to tap into the economic growth prospects because this means increased economic growth, increased jobs and increased exports. Our relationship with China and its interdependency is fundamental to our economic future. We have to build on it, we have to strengthen it, we have to deepen it, but we should never fear it.