Topics: G20 summit; US-China trade tensions; Chinese visitors to Australia; foreign investment; coal; AHKFTA; IA-CEPA; innovation.
Interviewer: So do you think the G20 members can work out some sort of communique that actually is close to the consensus?
Simon Birmingham: I hope so. That was achieved last year in Buenos Aries and having a consensus communique will send confidence into markets and to business that there is at least agreement around some of the fundamentals, and those fundamentals we hope are that there is an element of commitment still to a rules-based system based around the World Trade Organization. To modernising that, improving that, and there is some very important work that we want to see achieved in terms of completing negotiations on fishery subsidies this year, continuing work on industrial subsidies restarting next year ideally work on agricultural subsidies, and modernising some of the functions of the World Trade Organization whilst continuing the very important negotiations we launched at the start of this year around e-commerce and digital trade.
Interviewer: You were at the Donald Trump and Scott Morrison dinner last night. What was the message on global trade that was sent up there?
Simon Birmingham: Well Prime Minister Morrison gave a message that is very much consistent with the significant speech he gave before coming to the G20 that great powers have great responsibilities. That of course the United States has long been a great economic power since the end of World War II in particular, and it helped to build and establish many of the global institutions that have allowed for and facilitated the rise and growth of economies around the world including China who are now also putting out a great economic power. And what we urge both parties now as two great economic powers is to recognise that they cannot just operate in their own interests, that they have to recognise responsibilities to the rest of the world. And that their fight over trade tensions is having an impact on rates of global trade growth, rates of economic growth and as a consequence that’s hurting other economies around the world. And that’s why we urge them to negotiate, negotiate thoroughly and ultimately hopefully reach some agreement that eases those trade tensions.
Interviewer: Such as Australia. What’s the impact on Australia so far?
Simon Birmingham: I think there is little doubt that for Australia and for most other countries here and those not here, economic growth prospects would look a little bit better if we didn’t have these trade tensions. Australia’s economy is still performing strongly, we are in our 28th consecutive year of economic growth in Australia. We’ve seen record levels of exports, an incredibly strong performance and part of that is because of the success in building strong relationships within our region, the broader Indo-Pacific. But we do need to make sure that the things that have allowed us to grow over these years and our region to grow, are protected and modernised for the future to make sure they are fit for purpose. And the WTO and its rules sit very much at the heart of that.
Interviewer: Your portfolio is trade and investment and tourism and in those three areas due to tensions with China for example, I know that Chinese tourism numbers to Australia have fallen. How concerned are you and what are you doing to address that?
Simon Birmingham: Well our Chinese tourist numbers haven’t actually fallen. The rate of growth has fallen but of course as China’s market has grown larger and larger, we expect to see…
Interviewer: Many other countries are competing.
Simon Birmingham: And many other countries are competing but we expect to see some reduction in the rate of growth but it’s still a huge market that is growing and growing significantly in terms of the numbers of individuals. What we’ve done this year in tourism is we have both worked around the approved destination status putting more funding back towards that which supports organised tour group visits to China, but also we’ve launched a particular marketing campaign targeting so-called free and independent travellers, those who make their own bookings, make their own plans and encouraging them to come and explore Australia in ever greater numbers. And we have been seeing a shift in those tourism numbers of greater proportions, of those free independent travellers and we want to keep encouraging that market to grow.
Interviewer: What about investments? I guess Chinese investors are getting the message especially from Australian media that they’re not welcome?
Simon Birmingham: Well I want to make it very clear that investment in Australia is welcome. Yes we have safeguards to make sure that our critical infrastructure is safe and to make sure that competition is not harmed. But otherwise Australia is an incredibly open country for investment. The vast majority of investment applications that go through our Foreign Investment Review Board are approved and Australia wants to see continued growth in China, continued economic growth because we know that will continue to lift people in China and elsewhere around the region out of poverty circumstances in some cases, create more opportunities and indeed be good for Australia. But a key part of that indeed is the two-way investment flow and we’ve seen growth in Australian investment in China and we want to welcome and continue to see that investment by China in Australia because that can of course help those Chinese companies to grow further in the future too.
Interviewer: Well last weekend I was told an Australian company opened their first restaurant Hurricane, I don’t know if you know of the chain. A steak and ribs restaurant in Beijing their first branch in China so hopefully that grows as well. What about trade though because we know that because Huawei because of various issues in China has stepped up restrictions importing certain Australian commodities?
Simon Birmingham: Well China has assured us that in terms of things like slowing down of processing times around coal that these are not discriminatory measures that they’re not targeting Australia and we take those assurances at face value. We continue to engage behind the scenes with officials to try to understand if there are additional environmental checks being undertaken and how we can make sure they’re done as quickly as possible. How we can give Australian business certainty around the export times, the time it would take to get shipments processed and through into market in China. And that’s not just important for those Australian businesses but of course this is a supply chain. Coal is used by Chinese industry and business and it’s important that those industries and businesses have certainty that they’re going to receive the products they’re expecting in the timely manner that they expect it.
Interviewer: (indistinct) long-term structural issues in Australia, I moderated a forum recently that talked about because there’s so much superannuation money that is focused on short-term returns, that’s why the whole venture capital and innovation drive hasn’t taken off as strongly as the government has hoped. I mean of course that will have ramifications for the sustainability of your portfolio as well. What do you think Australia should do more to foster more innovation?
Simon Birmingham: We do want to encourage more startups more scale-ups and I know that in parts of Australia we’re seeing some strong work in building hubs in my home city of Adelaide. The State Government there is particularly focused on building a new innovation and commercial hub in Adelaide that does encourage some of those technology startups, it is the home to the new Australian Space Agency which is going to be a very important vehicle to try to bring in more investment in high tech areas, recognising that Australia’s unique geography in particular makes its potential high value location for launching of low orbital satellites and other developments in those areas of space technology. Our work as a nation in terms of medical devices and medical equipment is an area in which we are a world leader.
Simon Birmingham: Cochlear indeed being one that really comes to mind and a very strong global brand, developed as an innovative product out of Australia. But other health and medical devices are important and as a government we have managed to build a very significant medical research future fund that we hope will continue to turbocharge really medical research in Australia. From that of course hopefully grow some more Cochlear’s for the future.
Interviewer: Going back to the G20 talks especially around trade, how is Australia setting up contingency planning in the case that China (indistinct)?
Simon Birmingham: Australia continues to try to make sure that our market access is as strong as possible in as many markets as possible. So over the course of my time as the Trade Minister in less than 12 months, we’ve concluded negotiations around new trade agreements with Hong Kong, with Indonesia, we’re seeking to legislate one as well with Peru, and we’re continuing negotiations to hopefully conclude the RCEP discussions this year, as well as our work with the EU and elsewhere around the world to really make sure that Australian business, farmers and businesses, have that type of preferential market access that can allow them to successfully compete in as many countries and economies as possible. Because we do realise the real importance there of making sure that all our eggs aren’t in one basket but that we do try to ensure that market access is there and that business and trade growth is there with other countries as well.
Interviewer: Okay, good. Thank you.
Simon Birmingham: Thank you.