Topics: Regional Comprehensive Economic Partnership;
Simon Birmingham: This afternoon, I look forward to signing the Regional Comprehensive Economic Partnership agreement on behalf of Australia, together with the Prime Minister. This is a huge accomplishment, especially for the ASEAN nations. The 10 nations of the Association of Southeast Asian Nations have provided remarkable leadership to bring about this 15-nation trade agreement that will be the biggest trade agreement of its type globally. What this does is provide a common set of rules and approaches in terms of trade across some 15 nations that account for 30 per cent of the world’s population and around 30 per cent of global GDP.
This is an incredibly important agreement in terms of the timing for when it occurs. Symbolically, we see huge pressures globally on the trading system and of course pressures that Australia faces, too. This agreement signifies that our region, which has been the most economically dynamic region of the world in recent decades, is still committed to openness and to trade and that we will use that as a platform and a springboard for recovery in the post-COVID era. Australia is a country where one in five jobs relies upon trade, and we know that better access for our farmers and businesses means more jobs for Australians overall. That’s why our government has consistently pursued trade agreements since we came into office, securing agreements with Japan, Korea, China, the Trans-Pacific Partnership that gives us better access into Vietnam, Canada, Mexico and others, our agreement with Indonesia that came into force recently, the PACER Plus agreement with Pacific Island nations, and the negotiations we continue to pursue with the European Union and with the United Kingdom.
The RCEP agreement includes nine out of Australia’s 15 top trading nations. These are our biggest trade partners, and that’s why having more common rules and better access into those markets is going to be great news for our businesses, our farmers, and for jobs of Australians in the economic recovery of Australians. Right now, Australia does have different trade agreements across all of the other 14 nations in this RCEP agreement. There are in fact 10 different trade agreements that businesses can currently access to be able to export into these markets, and that’s been great news in terms of lowering tariffs and providing better access and driving growth across the nations of RCEP. But it has meant that for business there’s been a more complicated range of processes – that you may have different terms to be able to access markets in Japan compared with the Philippines, compared with Korea or China or Singapore or other RCEP nations. What RCEP provides is an agreement of all 15 nations are some common rules, common rules that lift the bar in relation to digital trade that’s become so important during the COVID era. Common rules in relation to the treatment of intellectual property that is so important for Australian businesses when we head out into this region. It also provides the better market access, especially for so many of our services industries. Those services industries across financial services, healthcare, aged care, education services – these are all crucial sectors for which Australia has got a huge economic footprint at a domestic level, but traditionally, our exports have been dominated by trading goods. For most of these markets, we’ve seen goods barriers such as tariffs eliminated or phased down under existing agreements.
RCEP is going to provide the platform for us to be able to actually have better growth in those services sectors as well. They will have more opportunities to do business from Australia in RCEP nations or to open up in those RCEP countries. The positive news across the board – and this is a key part of our ongoing plan for economic recovery post COVID – RCEP has been eight years in the making. It’s taken determination and drive by the ASEAN nations and enormous leadership by them to bring the parties together. We are disappointed that India is not part of the final agreement, but we do see this as a huge platform and pillar upon which we can keep driving trade growth for Australians, deliver more exports, which means more jobs for more Australians in the future.
Question: Minister, it’s no secret there’s been escalating trade tensions with China. Are you hoping that this deal will open dialogues with your Chinese counterparts and perhaps maybe even facilitate a face-to-face meeting in the future?
Simon Birmingham: I welcome the fact that Australia and China have been able to continue as partners in the RCEP agreement. It’s an important sign of our willingness to continue to work in regional cooperation and regional economic partnership. There are difficulties at present, and I am deeply concerned by the fact that in a number of areas, Chinese regulatory actions have disrupted trade flows. I urge all parties to the RCEP agreement to engage in implementing not only the letter of it, but also the spirit of it, and I hope that it will provide a platform for ongoing economic and dialogue between all of the parties across the region.
Question: How important is RCEP to diversifying our reliance on Chinese trade, allowing us to not be so subject to [indistinct]…
Simon Birmingham: RCEP is crucial because it has the 10 ASEAN nations at its core. ASEAN put together, is Australia’s second largest trading partner. It includes some of the most dynamic economies in the region, such as Vietnam and Indonesia, notwithstanding the current disruptions of COVID. It includes some of our oldest trading partners as well, such as Thailand, Malaysia, and Singapore, and those 10 RCEP nations with enormous diversity are central to the strategic relationship that Australia has with our region. That’s why we’ve celebrated and worked so closely with the ASEAN nations in terms of their leadership and their drive to deliver this agreement. We see the opportunity for huge economic growth and trade growth between Australia and the nations of ASEAN, but also for integration of supply chains that can give Australians businesses easier and better access and greater diversification over time amongst those countries.
Question: Keeping in regards to China, its Foreign Ministry spokesman last week accused Australia of having poisoned the relationship and noted speaking out on issues like Hong Kong and Taiwan as part of the problem. Is Australia willing to refrain from speaking out on issues like that, particularly democracy in Hong Kong, to get the trade relationship back on track, or is it going to continue to stand by it’s issues or principles on these matters?
Simon Birmingham: Australia’s position in relation to matters of human rights or matters of democracy and the hand-over of Hong Kong, as it was, at the time of the hand-over, has been a long-standing and consistent position. Australia has not deviated throughout the years from our position in terms of advancing and expecting nations to respect human rights in terms of the consistency with which we have expected the legal agreement and treaty that enabled the hand-over of Hong Kong to occur, to be upheld and to be implemented and honoured. Our position is a consistent one up until this point, and it will remain consistent into the future. But out position has also been one of consistently welcoming and wanting to pursue mutual engagement in areas that are mutually beneficial between Australia and China. That’s what’s enabled Australian businesses and Chinese businesses, Australian people and Chinese people, to grow a strong economic relationship and partnership over a long period of time now. We remain committed to that partnership with the same type of consistency, just as we remain consistent in all of our other policy positions.
Question: You’ve said before that it’s important for trade to have the planes coming in, because then they can fill up with Australian goods and go out. The PM’s talking with Daniel Andrews tomorrow. How soon do you think we can get international flights back to Melbourne and how important is that, not just for getting Australians home but for our exporters?
Simon Birmingham: Look, anything that sees extra international flights coming in and out of Australia is good news for our exporters, but it can only happen where it is safe to do so, and our government’s been consistent about that all along. We’ve stepped up with additional assistance for freight-specific flights out of Australia – hundreds of millions of dollars that has kept more than $1 billion worth of Australian exports leaving Australia and hitting the markets overseas, and that’s been a crucial support to many thousands of Australian farmers and exporters of premium but time-critical produce to be able to get out to markets. The big gain that will happen if we can see Melbourne Airport again welcome international arrivals and quarantine them safely is that it will provide a huge uplift in terms of additional capacity for returning Australians. That remains our number one priority, and we will keep an intense focus there and hope that Victoria can again play its part.
Question: Minister, are you anticipating any interim tariffs on Australian wine from China next week after we’ve handed back our submissions to the anti-dumping inquiry?
Simon Birmingham: We remain deeply concerned about the anti-dumping investigation that China launched into Australia’s wine industry. Australia is clear that our winemakers are not subsidised by government, and they do not dump their product in overseas markets. And there is no justification for any type of interim duties to be put in place, and that is what we would hope the findings of China’s investigations will settle on, given the evidence that has been provided to date. However, given the track record this year of adverse regulatory decisions, we are deeply concerned and hope, though, and urge China to focus on the evidence. And if they do look at the evidence and stick to the appropriate processes in analysing that evidence, they will find that Australia’s wine industry operates according to commercial market practices, and there’s no justification or grounds for tariffs to be applied.
Question: What improvements to access Australian services markets will this give RCEP nations? And will any changes be required to legislation or programs here in Australia?
Simon Birmingham: So, RCEP has been carefully negotiated, and what we have is, of course, an agreement here, as I said before, that layers over the top, if you like, the existing network of 10 agreements that we have across the 14 other nations who are party to RCEP. It gives a more common set of rules and standards and a higher ambition in areas that are important to Australia, like intellectual property and digital trade and commerce. In terms of for Australia, there are no requirements for us to make changes in relation to labour market testing rules or the like. There’s no new application of ISDS provisions, so some of these types of factors that have been raised as concerns or scare campaigns by some of the opponents to trade agreements are not part of the RCEP agreement. We will work through the normal ratification processes in terms of it being thoroughly scrutinised by the Joint Committee on Treaties, and of course, any legislation that is necessary to implement some of the technical aspects of RCEP will then proceed through the Parliament in the usual way.
Question: Can you give more confidence that the US will come into more global trade discussions generally with a new administration?
Simon Birmingham: I look forward to the opportunity for Australia to have new and fresh dialogue with a Biden administration around trade policy when they take office. We certainly worked hard as a government to- under Malcolm Turnbull’s leadership to keep the Trans-Pacific Partnership in place and to make sure that it entered into force and that provides a door that is always open and that Scott Morrison has reinforced publicly remains open to the United States to join the TPP, which is one of the most advanced trade agreements in the world in terms of the standards and terms that are set within it. We would warmly welcome the US to the table there, but we in no way are pressuring them to do so as well. We recognise that a new administration will have much on its plate, but economically and in a trade sense, just as in a security sense, we encourage US engagement in the region, and the TPP would be one basis for doing so. We also look forward to cooperation at the World Trade Organization, where the US has remained an important partner in discussions such as those on ecommerce negotiations, and we hope that a Biden administration can continue that momentum but also work to resolve some of the difficulties at the WTO, such as around the appellate body and its appeals processes.
Question: What types of businesses in what types of industries are set to benefit from this agreement?
Simon Birmingham: Look, the real benefits here are twofold. One is, for our farmers and exporters, they get a more common set of rules across all 15 nations. The other is, for our services export industry, they get significant new access across financial, banking, aged care, healthcare, education, and other types of services industries, right into provision of architectural or engineering and planning services. This is about making sure that we have the opportunity for that part of our economy, the services industry, to be able to grow and get the same type of uplift in trade benefits across the region that our goods exporters have had over recent years.
Question: Just on India, why is it such an important market? And why did it not sign up?
Simon Birmingham: So, India is the second largest population centre and has huge growth potential in terms of the way in which we see our region. India had been a valued part of the RCEP negotiations for most of the eight years under which they were undertaken. Regrettably, India chose not to proceed in the final year, and that diminishes some of the value for Australia, particularly given India would have been the one RCEP partner with whom we did not previously have any type of FTA. However, the value of RCEP is still there; it’s still clear in terms of especially the opportunities for those services exporters, and the door remains open for India to rejoin RCEP at a later time. And there will be a clear statement, I expect, made by leaders in RCEP countries acknowledging that we would welcome India back to the table at any time in the future.