Topics: Barley WTO; Australia-China trade relations, Jobkeeper
Sylvia Jeffreys: Well Australia is officially taking China to task over barley tariffs this morning, calling in global umpire, the World Trade Organization, as the trade war escalates. But Beijing’s pointing the finger right back, accusing Australia of breaching its Free Trade Agreement by blocking $14 billion worth of business deals.
Federal Trade Minister, Simon Birmingham, joins me now from Canberra. Minister, good morning to you, thanks for your time. This is the first time we have taken China to the WTO but what is that likely to actually achieve?
Simon Birmingham: Hi, Sylvia. Yes, well it is the first time we’ve taken China to the WTO. It’s not the first time we’ve used these processes. Even in the last couple of years we have initiated challenges to India in relation to the sugar industry, to Canada in relation to wine market access. And importantly, with the Canada one we didn’t have to go through all of the processes – through dialogue and discussion we were able to sit down and resolve that earlier.
And that’s the offer that we continue to make to China in this regard – but yes, we’ve started the formal processes with the WTO, called in the independent umpire to make an independent decision which we’re very confident of given that we know that Aussie farmers don’t dump their product on international markets, aren’t subsidised by Governments, but purely produce high-quality, premium, world-valued grain.
But we’ll work through those independent processes. They take longer than would be ideal, but it is the right thing to call out wrongdoing by China and to call in the independent umpire.
Sylvia Jeffreys: You mentioned our case with India, that’s been dragging on for more than two years. That could very well be the case this with case against China. In the meantime, would the Government consider new subsidies or other support measures for struggling grain growers?
Simon Birmingham: Look, it’s not a quick fix, that’s right. But in the meantime, what we do is seek to help our farmers and all exporters to access other markets. We haven’t just done a trade deal with China in the last six or seven years, we’ve done trade deals with Japan, with Korea, with Canada, with Mexico, with Vietnam, with Indonesia. We’re in negotiations with the European Union, the United Kingdom and India.
All of these are crucial markets and opportunities and we’re already on the ground around the world seeking new access for grain growers in places like the Middle East as well as South East Asia, to help them find alternate markets for this product.
Sylvia Jeffreys: Nothing’s going to come close to the China market for barley growers, though. It’s worth $500 million a year.
Simon Birmingham: China is a big market, and of course, a big market with a booming middle class and it pays off in premium prices. And it may be the case that some businesses won’t be able to get the same price for the same product in other markets. And that’s why we are so deeply frustrated with China’s actions in this regard. But as the Australian Government, we’re going to stand by our farmers, our exporters and help them find alternate markets and do as best they possibly can – as they always do.
Sylvia Jeffreys: Minister, China is not happy about this. Let’s have a look at this quote from China’s Foreign Ministry spokesperson who says: Australia dresses up as a victim pointing and accusing finger at China. It is the Australia side that has been politicising economic investment and technological issues, and discriminating against Chinese companies.
Have you stoked the fire?
Simon Birmingham: Well, this shouldn’t be, shouldn’t be the reaction. China themselves have taken other countries to the WTO. This is normal process, as I said, that we’ve used against other countries like Canada and India. I stress that we are happy to sit down and talk. We don’t need to go through the full dispute resolution process – we could resolve these issues by dialogue.
Australia is consistent in our approach; consistent in defence of our values and our national interest which is never for sale; but also, consistent in the fact that we also value the partnership with China and we would like to be able to resolve these issues by working through them with China.
Sylvia Jeffreys: Well, let’s hope we can resolve them for the sake of all the industries involved.
In other knew news, a glimmer of hope in the mid-year financial review – JobKeeper will cost $11 billion less than first projected. That’s encouraging news, right?
Simon Birmingham: Look, it is really encouraging to see the strength of the recovery in the Australian economy. Now, there is still a long way to go but we’ve seen more than 650,000 jobs created across Australia in recent months. More Australians back in work, fewer Australians on JobKeeper – this is a trend that we want to see continue but we know that there are always threats present.
But we are delighted to see that the measures put in place to help the Australian economy through the depths of COVID-19 and drive it into recovery are working, and we’ll have to continue to show that type of determination to keep them working in the months and years ahead.
Sylvia Jeffreys: One point six million people are still expected to rely on JobKeeper though when it expires in March. What are they going to do come March?
Simon Birmingham: Right throughout this crisis we’ve ensured everything we have done has been to respond in a way that is temporary in terms of the direct assistance there, but also targeted to those who need it most – the sectors that are necessary and proportionate to the circumstances. And we’ll keep that analysis going right through the period of March.
And no doubt beyond, the roll-out of vaccines will take some time but Australia is very, very well placed to be able to ensure that we deliver those vaccines as safely and effectively as possible across the population, and help to continue the population and help to continue the flow of recovery from this crisis.
Sylvia Jeffreys: Well, you will soon leave the China trade war behind as you head into the finance portfolio, Minister. But you will be heading straight into the country’s biggest ever deficit. So we wish you well. We thank you for your time this morning. And we wish-
Simon Birmingham: Plenty of challenges but thank you very much, Sylvia.
Sylvia Jeffreys: Challenges all around but we wish you some Christmas cheer too. Thank you for your time this morning.
Simon Birmingham: Thank you, and you. Cheers.