• Transcript, E&OE
Topics: Coronavirus impact on trade.
01 April 2020

Annelise Nielsen: Now joining us live is Trade Minister Simon Birmingham. Simon Birmingham, thank you for your time. Now, one of the really early impacts we saw in the coronavirus pandemic has been on Australian seafood exporters. I know the banks were saying they were the first ones to come asking for loan help when this all kicked off. What is being done now to support that industry?

Simon Birmingham: So indeed, Annelise, what we saw was that as China went into its shutdown initially, and particularly as Lunar New Year celebrations were cancelled, our seafood exporters really were the first economic hit that the Australian economy took. And of course since then, even though we’re seeing some recovery in demand in China, it’s now not just us seafood exporters but all of those exporters who depend upon usually the bellies of passenger aircraft to get their freight out who are now doing it incredibly tough. So the Government is stepping up to provide some limited support in terms of underwriting or subsidy arrangements to try to increase the freight capacity for particularly seafood and agricultural exports out of this. This is crucial to make sure that our fishers and our farmers who are so dependent upon the export markets are still able to get their goods out to those markets so that we can protect their businesses and save the jobs of the employees who work within them.

Annelise Nielsen: There have been serious concerns with how China has conducted itself on a global level during this pandemic. That they could have given us more information sooner, there’s questions even now about the veracity of the information coming out of China. Do you think we can ever have the same trade relationship with them now that we had before coronavirus?

Simon Birmingham: The trading relationship with China is a very important one. Now there will clearly be thorough analysis as the world moves through, and particularly gets beyond the coronavirus crisis, in terms of analysis of the information and the approach that was taken to controlling this virus and how the world cooperated. And there will need to be very thorough investigations and open cooperation from all nations. What we’re talking about here is about ensuring that our farmers, our fishermen, people who depend upon being able to send the surplus of agricultural produce that Australia generates out to the rest of the world, is still able to do so. China is one of those countries, but so too is Japan. So is Singapore, of course, Singapore trade hub, so indeed is the UAE, is another key trade hub that we need to get produce out to so that it can then be distributed to all of the different markets upon which depend.

Annelise Nielsen: But China is our fifth largest trading partner. If we take them in concert with Hong Kong as they insist that we do, do you think that we can still consider them a dependable trading partner after coronavirus considering how they’ve handled themselves?

Simon Birmingham: Well China are a significant and important trading partner. We’re a trading partner. We’re in the [inaudible] as I often say, business [inaudible]… they do business. We don’t determine as a government, who our farmers sell their goods to, or who our fishermen sell their goods to, or who our mining or resources companies sell their goods to. They decide those things. We indeed open up market through the type of free trade deals that we’ve done as a government over the years. Whether that’s with China, or Japan, or Korea, and with the United States in the days of the Howard Government or the Trans-Pacific Partnership. They’re all about improving the access that farmers and fishers have into different markets. But what those businesses do is then go out and seek the best price, the most reliable customer, the best deal for them as Australian businesses to generate export earnings for Australia, jobs for Australians, revenue in terms of the taxes that are paid. And what we are doing through this measure is simply another job saving measure. First and foremost, as a government, we’re focused on saving the lives of Australians by containing the spread of this virus and by making sure that we contain it in a way our health system can cope. But then of course we’re focused on saving the jobs of Australians, knowing that the type of restrictions put in place in the global economic downturn are threatening jobs. That’s why we made the huge step this week with the JobKeeper payment. A crucial payment to ensure that people stay tied to their employers. And this freight subsidy measure is again about making sure that we can save jobs of other Australians and in saving those jobs here, what we’re doing is ensuring they continue to earn export dollars, pay taxes, be viable businesses and keep us well-placed for the future.

Annelise Nielsen: I take your point that it should be up to businesses to conduct themselves in any manner they like, but if an Australian business decided they could do a roaring trade with North Korea, the Government would not put resources towards helping make that happen. Should the Australian Government be moving so quickly to try and help the trading relationship with China when we have serious concerns about the way they’ve conducted themselves through this, or should we be helping them trade with other countries including our four biggest trading partners?

Simon Birmingham: Look, China is in fact our largest trading partner. I don’t think it’s remotely analogist to compare it to North Korea in terms of the type of measures that we have in place to restrict trade with North Korea, as we do with certain other targeted countries where sanctions are put in place for a range of other reasons. Now, what we are seeking to do here is to make sure that we protect the businesses, the jobs and the livelihoods of fellow Australians. Now, that is something that I would hope everybody supports and wants to do. Yes, we’re making sure they can also access markets well beyond China. This scheme is not about exclusively the China market. It will be supporting crucially, first and foremost, I think, in terms of the initial flights to Japan, flights also to Singapore, flights also to the United Arab Emirates. It’s about getting our goods into all of the markets of the world upon which we depend.

Annelise Nielsen: And Minister Birmingham, will the Government still be able to deliver on its promised income tax cuts in 2022, ’24, considering it looks like we’re going to be lumped with about a trillion dollars’ worth of debt after all of this, coronavirus impacts hit the economy.

Simon Birmingham: We will, Annelise, and we will for a few reasons. First, we entered this crisis in a far better financial position than most other nations. So, we entered with a stronger budget balance sheet, a stronger budget position than most other nations. Secondly, because our Government has taken approach, not only of ensuring that our measures of support for the economy are proportionate and are targeted to those sectors and people who need it most, but also because we are ensuring that they are restricted to the time in which they are necessary. These are not ongoing spending measures that we’re putting in place; they’re measures to get Australia over that bridge to the other side of this virus and to keep people employed and to preserve the productive capacity in our economy through that time.

So we’re confident that when we get to the other side, the spending drops off, as it should, and that we get the economy ticking over again. And crucially, those tax cuts that we’ve already legislated will be a key component of ensuring that Australian households and Australia’s economy is as well-placed as possible to continue to grow in those years ahead and to be competitive.

Annelise Nielsen: Simon Birmingham, Trade Minister, thank you for your time.

Simon Birmingham: Thank you Annelise.