Monday, 25 November 2019
Customs Amendment (Growing Australian Export Opportunities Across the Asia-Pacific) Bill 2019, Customs Tariff Amendment (Growing Australian Export Opportunities Across the Asia-Pacific) Bill 2019; Second Reading
This chamber has seen some debates over the last 10 years—especially in the last seven years—on free-trade deals. After Mr Tony Abbott got elected as Prime Minister, we had a flurry of free-trade deals at the same time that his government started their austerity, zombie budget cuts. While we've had some pretty big biffos over the years with the Labor Party, and big differences on free trade, I never in all my years thought I'd hear a Labor senator get up and give a speech on jobs and growth in this chamber without any consideration for Labor's previous policies—not, for example, including ISDS in their free trade negotiations. I'll come back to that a little later, but I want to read a quote from Nobel Laureate Paul Krugman. He summed up a lot of my concerns around today's legislation. He said:
The first thing you need to know about trade deals ... is that they aren't what they used to be.
Rather than old fashioned trade in goods and services—listening to Senator Smith's contribution, that's absolutely what you might think they are—current negotiations in trade deals are aimed at standardising domestic regulations between countries, through investments and other chapters that have ramifications for important aspects of economy and society that go way beyond international trade. These free trade deals are negotiated entirely in secret, outside the remit of parliaments. We don't get to see the scripts of these trade deals until they come to the JSCOT and we're told to rubberstamp them. We, as elected representatives in this country, have absolutely no democratic input to the contents of these trade deals. Considering that they touch nearly every aspect of our society, why is that and how is that acceptable in this day and age?
The Greens initiated a large inquiry into the treaty-making process. While everybody agreed—and I heard this in Senator Smith's contribution—that they are deficient and they are not acceptable, nothing has changed. I urge senators to go read that Senate inquiry report into the treaty-making process and how the process has failed us—how it was written for an 18th century government in England who was conducting treaties around war and the conquest of countries. Here it is well over a century later and we have this same division in power between the executive and the parliament, where the executive get to negotiate free trade deals under the treaty-making process with no input from the Australian parliament, no input from elected representatives and no input from the Australian people. These deals are negotiated behind closed doors, and the majority of the content that is negotiated—and we have seen this in all previous trade deals in the last seven years, particularly the large multilateral trade deals like the TPP and the IA-CEPA, which is currently being negotiated—is being driven mostly by big transnational corporations. It is no coincidence that they happen to have operations in all these countries around the world that are suddenly adopting all these new trade deals, because they are trying to standardise laws and regulations between countries. Issues of significant matters of public interest, like the role of government in our lives and like government procurement, are out the door. That has been totally ripped to shreds by this decade of free trade deals.
I have often commented to people when I see the hundreds of billions of dollars being spent on our defence industry: why is it that the government is so active in spending money on defence procurement? It is probably the last area that has not been carved out by free trade deals. It is signed on by the Labor Party, joining the Liberal Party on a unity ticket, and reducing the role of government in our lives. What we have left is a military industrial complex and the government in bed together. It is the only area where we can actually have government procurement, because it has been precluded in just about every deal that we have signed in this place. From local government level all the way to federal government, we have sold out our role. The idea that the executive government can exclude parliament from the trade and treaty negotiation process is undemocratic and totally unacceptable.
Unlike some other senators in this chamber, I have sat on numerous JSCOT inquiries over the years. We initiated the world's first inquiry into investor-state dispute settlement clauses. This was at the same time as the European Commission was looking into the issue of ISDS. It is interesting how we are talking about having a free trade deal with Europe but they do not want an ISDS. Why is that? Why is it that the Europeans are not too keen on ISDS? It is because at least they are progressive and they understand that it has eroded our democracy. Why are we giving corporations a right to second-guess decisions made by parliament that are in the public interest simply because it may not be in their self-interest, in the interest of their profits and their shareholders? You can forget all this rubbish about carve-outs and exceptions. They have been thoroughly debunked. They were written entirely for corporations.
Did you know, senators, that these shady ISDS tribunals that often occur in other countries and that involve issues in places like Australia—like we saw with the Philip Morris case—have absolutely no transparency around who is selected to be on these tribunals? There is absolutely no transparency! I am talking zero transparency around the decision-making process. And you cannot appeal the decisions, yet they are binding, which raises another significant moral dilemma with these trade deals. It is okay to have binding agreements in here for matters that affect businesses and their profits, but where are the binding agreements for human rights issues? Where are the binding agreements?
Sitting suspended from 18:30 to 19:30
I accept that there are winners and losers in so-called free trade deals. There is absolutely no doubt that there will be businesses who either will start exporting or are currently exporting that are going to benefit from opening up markets internationally. Isn't it interesting that you never hear from this government any rhetoric around the flip side of this? That is that we open up our market to foreign businesses—that foreign businesses sell their products and their services into our markets. The input-output models that are an attempt to model the so-called benefits of free trade deals have been widely debunked as being inaccurate in the assumptions in their 15-, 20- or 30-year forecasts of the benefits that are going to be reaped for Australia's gross state product or gross domestic product. Most economists will tell you that this is a zero-sum game in terms of international trade. If you sign a bilateral deal with one country, you end up potentially excluding what your potential windfall gains could have been to another country.
As we get into multilateral trade deals, this kind of web becomes even more intricate, even more complex and even more difficult to understand. I have consistently raised in this chamber that this rush, this stampede, by the Liberal government starting in 2013—starting with the Korean free trade deal through to the Chinese free trade deal, the Japanese free trade deal, the Trans-Pacific Partnership and so on and so forth—was a really good distraction from the economic problems that we have in this country. They were used par excellence to sell the government's 'jobs and growth' message, which is exactly what we are hearing tonight. Sadly, it is also coming from the Labor Party.
This is serious stuff. This is the premier chamber of the land, where we get to interrogate legislation before it is passed into law. Why is it that we accept a process where we only get one decision? We vote either for or against the enabling legislation of a free trade deal, but we never get to amend it. There is no chance that I could amend this if I tried. If you amend a free trade deal which, let me remind senators, has already been signed by the countries under consideration—in this case, it may well be Hong Kong, Indonesia or Peru—it has already been signed! It has already been agreed to before parliament has even seen it, before civil society has even seen it and before unions and workers' groups have even seen it. However, I am sure businesses have seen it. In fact, we know with certainty that, in large deals like the Trans-Pacific Partnership, businesses have been in there negotiating when everyone else has been excluded. How can that possibly be?
Yet here we are, elected by the Australian people to legislate on their behalf, and we have no say in the construction of this trade deal. Sure, we can vote against it or we can vote for it, but how do we have a treaty-making process in this country after over 100 years that is so deficient?
The only attempt to amend the treaty-making process was the introduction of JSCOT, where at least parliament got to look at a trade deal. But JSCOT, as we all know, is chaired by the government, and anyone who's been on JSCOT—I've probably been on too many JSCOT committees in my time in this place—knows that it is a rubber stamp. It makes recommendations, but hands up anyone in here who can give one example of a JSCOT recommendation to any trade deal that has ever been implemented. Name just one recommendation from the Joint Standing Committee on Treaties that's ever been incorporated into a trade deal.
It's entirely undemocratic. It's not representative of our political parties and the people we represent. And these deals are becoming more and more sinister by the year, as we have pretty much traded away everything we've had, as we've opened up our economy. What is there left to trade in these deals? Well, we've got whole new areas being included in trade deals—temporary work visa programs, the right of government to regulate in the public interest, new rules around government procurement. I'm hoping that we can fix the recycling crisis in Australia by getting government to buy recycled content and to invest in solving this externality. Government used to be able to buy cardboard and paper, but it can't anymore, because of free trade deals. I want government to buy Australian recycled glass for the tens of billions of dollars worth of road projects around this country. Oh, that would be discriminating against a country we've signed a deal with. That would be giving preferential treatment to a 'foreign company'. We've sign these away, willy-nilly, and sadly I have been here to witness most of this. In the last seven years there have been a whole lot of deals.
I want to talk about that preferential treatment for a second, because I remember all the fanfare around signing the Chinese free trade deal. Senators may be aware that, in recent weeks, a Chinese company has bought a Tasmanian company a called Bellamy's. I've been very outspoken in my concerns about this takeover. This is a Chinese government partly owned subsidiary that was competing against Bellamy's. They came in and bought Bellamy's. Bellamy's was languishing on the share market. Its shares dropped from $24 back to $8 when it was announced they couldn't get market access to China to sell their milk powder. The Chinese government were issuing 300 new licences for milk powder after a contamination scare. That's absolutely fine—I accept why they would do that. But why was it that a company like Bellamy's, out of 300 licences, was one of the last 27 to receive their approval, when they had nothing to do with the contamination scare? That was just straight-up market manipulation, in my books. But how do you hold a foreign government to account if they manipulate an asset on the Australian stock market? They shouldn't have been able to buy one of their competitors. I don't think that's fair, and I'm going to continue to raise this issue.
But the reason I raise it in the context of what we're signing here today is that the Chinese free trade deal was signed with great fanfare. Chapter 2 of ChAFTA sets out the rules of the agreement for trading goods, and it's very similar for these free trade deals. Article 2.7 sets out the rules for non-tariff measures and clearly states:
… neither Party—
as in neither the Chinese government nor the Australian government—
shall adopt or maintain any prohibition or restriction or measure having equivalent effect, including quantitative restrictions, on the importation of a good originating in the territory of the other Party …
In other words, the whole reason we supposedly signed ChAFTA was to establish fair and equal market access unless otherwise agreed to. The Chinese government withheld import approvals for Bellamy's—as they did for other companies, by the way—and since then we've had translated Chinese government media statements saying, 'Bellamy's shareholders should take this; this is their last lifeline.' Another one said, 'As soon as the deal goes through, their approvals will come through for their licences to sell milk powder to China.' They're not trying to hide this. Indeed, they even had a government-driven policy recommending that Chinese government owned companies buy foreign milk powder operators. Today it was announced that the same Chinese government owned subsidiary is buying Lion Dairy & Drinks in Australia. They access about eight to nine per cent of the raw milk supply in Australia, and the Chinese company that bought them, Mengniu Dairy, said today in their media release that they want to develop value-added markets. They're going to take the raw supply that they're going to access now through this acquisition and they're going to open up new markets, including in their home market in China.
Now, it might sound like that's an opportunity, and potentially it is if you're working in the milk powder industry, but if you're going to take, let's say, eight or nine per cent of all of Australia's raw milk supply and divert it to a new product in another country, where are the Australian producers, the manufacturers and the dairy operators making yoghurt and other products going to access their raw supply from? At the moment, most of the raw supply for milk powder comes from Europe and New Zealand—well, this Chinese company today said that they're going to now access that from Australia.
These kinds of things need to be considered, and I'm hoping that FIRB will have a good, hard look at any potential repercussions on competition, consumer and market prices, and, of course, market concentration. In terms of ChAFTA, where's this government's outrage? Where is this government's inquiry into whether these milk powder companies have been discriminated against under ChAFTA—under the deal that we signed with them? Well, there haven't been any. I've met with FIRB. I've met with the Treasurer's office. I've raised my concerns. I admit they've been taken seriously, but there's been no information put out into the public domain around this issue.
We need a proper inquiry into this. We need a proper inquiry into these kinds of investments and how FIRB interacts with our free trade deals and how the national interest test interacts with our free trade deals. What other kinds of manipulation are we seeing in markets by foreign governments? This is a whole new paradigm. But you'd expect from the rhetoric that I've heard from both the Labor Party tonight and from the government that everyone's a winner if we sign a free trade deal. Well, the Greens believe in fair trade, and that is the governments of any nation firmly setting criteria around fairness. It means we look at a whole range of issues around compliance with human rights, labour rights and environmental standards.
I can't say it in the language that's acceptable in this chamber, but it really annoys the hell out of me that we have these binding agreements on matters that relate to corporations and profits, like ISDS and shady international tribunals, but we don't have any binding agreements on the importation of foreign workers, labour rights in foreign countries or environmental standards. It's all lip-service; it's all greenwash in these deals. We need to rewrite the treaty process. We need to actually take back control of this from the executive as a parliament and have a treaty system for the 21st century. (Time expired)