Ms Julie Bishop (Curtin, Liberal Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

I welcome the tabling of the report of the Joint Standing Committee on Foreign Affairs, Defence and Trade's inquiry into Australia’s trade and investment relations with Asia, the Pacific and Latin America. I thank the committee members, particularly my colleagues from our side—the committee's deputy chair, Joanna Gash, and trade subcommittee deputy chair, Bruce Scott—for what is an interesting report. Most of the report is unsurprising, and there are a number of recommendations of particular interest that the coalition will have no problem supporting. For example, I support recommendation 1 which states that we should:

Work towards the admission of India to membership of APEC as soon as possible.

The coalition also subscribes to recommendation 3:

That Australia continues to set an example to other APEC member economies by: (i) maintaining its momentum towards trade liberalisation; and (ii) encouraging the APEC membership to push strongly for a positive and forward-looking outcome in the Doha Round.

However, I do make the point that we should avoid putting all our eggs in the Doha basket.

I note recommendation 6:

That Australia should strongly encourage the complete acceptance of the APEC Business Travel Card by the remaining members of APEC; and also explore the possibility of establishing a similar arrangement with other trading partners, e.g. non-APEC economies in Latin America, the EU and India.

Recent changes to the eligibility requirements for the APEC business card have adversely affected hundreds if not thousands of smaller businesses in Australia. The government has dallied on this matter. I understand that the relevant minister has been sitting for weeks on a departmental report designed to ease the red tape burdens.

Recommendations 9 to 13 relate specifically to trade with Latin America.

Recommendation 15 states that:

The Sub-Committee expressed its satisfaction that AusAID has given some emphasis to gender issues in negotiations with the Pacific Islands Forum countries. It proposes that these issues should continue to be advanced by DFAT and AusAID as a priority.

I certainly welcome that recommendation.

So, while not formally expressing the coalition view, I do believe that all these recommendations should be given serious consideration. As one of the leading trading nations in the world, Australia's prosperity depends on open and transparent international markets. Our national livelihood is reliant on international trade and the jobs and economic growth it creates. It is estimated that one in seven jobs in Australia is directly linked to exports, while one in 10 is dependent on delivery of imports.

The highest trade policy priority for the coalition remains the World Trade Organisation Doha development round and this has been a bipartisan position. With its global framework of agreed trade rules, the WTO remains crucial in preserving the openness of markets around the world and delivering further trade liberalisation. However, despite Australia's support for the Doha round, we acknowledge that progress has been unacceptably slow and there is increasing pessimism about the prospects of a successful conclusion to the Doha round. This slow progress in the major multilateral forum has led to increased focus around the world on regional and bilateral free-trade agreements. The coalition has a proud tradition of negotiating free-trade agreements. In many instances, regional and bilateral free-trade agreements offer the prospect of quicker and more extensive gains in the trading relationship between individual countries or groups of countries than can be achieved through the WTO. However, it is important to ensure that all free trade agreements are comprehensive, ambitious and WTO-plus. The proliferation of free trade agreements around the world means that to secure and protect Australia's competitiveness in our key export markets, Australia must be prepared to be bold in negotiating free trade agreements.

Despite the success of the coalition's trade policy when in government and the benefits derived from securing a number of agreements, including with the United States, Singapore and Thailand, virtually no progress has been made since Labor came to office in 2007. Specifically, this Labor government has made little progress in ongoing negotiations or ongoing discussions after feasibility studies were completed with China, South Korea, Malaysia, Japan, India or Indonesia and also, I point out, the Gulf Cooperation Council. I remind members that all these discussions started before the Howard government left office in 2007.

The final chapter in this report on the inquiry is about the government's trade policy statement released in April this year. Whilst the statement makes some worthwhile observations, there are some disturbing signs emanating from government ranks. The government's current trade policy has actually exposed deep divisions within Labor. For example, during an interview on the day the policy was announced earlier this year, Labor senator Doug Cameron labelled the Australia-US Free Trade Agreement a 'lemon' and a 'bad deal'. Senator Cameron was openly contradicting the Prime Minister, who had praised the tremendous benefits the agreement had brought to Australia during her visit to Washington DC just prior to his comments.

Senator Cameron has form with his anti-free trade agenda. When working as national secretary of the Australian Manufacturing Workers Union, Senator Cameron led a union campaign against Labor members who supported the free trade agreement with the United States. According to media reports in 2004, Senator Cameron wanted the union to withdraw financial support to Labor MPs who voted for the agreement stating:

I don't think we should be rewarding stupidity and cowardice.

Given that the current Labor Prime Minister was one of only 15 Labor members of parliament who voted with the Howard government in support of the agreement, I can only assume that Senator Cameron still holds that view. It is important to remember that such was the pressure from the union movement that 41 Labor members of parliament walked out of the House of Representatives to avoid having to vote on the Australia-US Free Trade Agreement.

Senator Cameron's views, along with a number of other Labor MPs, tie in closely with the extremist position of Labor's formal alliance partner, the Greens, which openly advocates the abolition of the World Trade Organisation, the International Monetary Fund and the World Bank as well as the removal of Australia from existing free trade agreements.

The internal division within Labor was also on display with strategic leaks from the Gillard cabinet when Treasurer Wayne Swan apparently warned against the unilateral trade liberalisation proposed in the government's trade policy statement. It is an interesting position for an Australian Treasurer to take but clearly the story was leaked to indicate to a certain Queensland union that the Treasurer was not really a supporter of free trade—there was a protectionist heart beating within.

It is also illuminating that under the Labor government resources for trade negotiation have been cut back. In 2007, there were cuts to the number of staff working on Australia's free trade negotiations with China. This would contradict the government's claims that a high-quality free trade agreement with China is a key government priority. The failure by the government to progress free-trade agreements has meant the loss of real export dollars. One case in point is the adverse impact on the rock lobster industry caused by the failure of concluding a China free trade agreement while our competitors in New Zealand concluded an agreement with China in 2008.

Economic modelling contained in the various joint government feasibility studies suggests that billions of dollars in benefits may flow to the Australian economy from the successful negotiation of comprehensive free

trade agreements. For example, it is estimated that Australia would achieve a US$18 billion increase in GDP over 10 years from a free trade agreement deal with China. While there can be a valid debate about the accuracy of the economic modelling, it is an indicator of the benefits that may flow. The Australian government should devote proper resources to free trade agreements, including fast-tracking current negotiations. Australia should fully engage with the Trans-Pacific Partnership Agreement negotiations and explore the feasibility of an agreement on services with the European Union. There is also a need for the government to work harder to complete negotiations launched by the Pacific Islands Forum for a regional trade and economic agreement, known as PACER Plus. It was disturbing to note that not one mention was made of PACER Plus, the Pacific Agreement on Closer Economic Relations, in the government's trade policy statement. According to the Department of Foreign Affairs and Trade, Australia's primary motivation in supporting PACER Plus is to help the forum island countries promote their own economic growth. In 2009, the then Minister for Trade, Simon Crean, described the agreement as an 'important commitment to the future prosperity of our immediate region'. The government must explain why it no longer considers PACER Plus as crucial to regional prosperity.

PACER Plus presents a unique opportunity for Australia and Pacific island countries to look beyond development assistance and cement closer economic relationships that will promote economic growth and open up new employment opportunities. The Pacific region is of key strategic and economic importance to Australia, and Labor must ensure there is no doubt in the minds of Pacific island governments that the region remains a very high priority for our national government.

In the absence of gains through the WTO, bilateral and regional free trade agreements can have a positive effect on the multilateral system and act as building blocks for global trade liberalisation and reform. I commend this report to the House.

Debate adjourned.