Topics: Australia-China relations; Trading relationship; CIIE;

Simon Birmingham: I acknowledge the Kaurna people, the traditional owners and custodians of the land on which we meet. I acknowledge their language and congratulations Tim and thank you for your Welcome to Country on your first attempts there at Kaurna language. I do occasionally attempt more than just two words but never without the script in front of me. But not only acknowledging language but also culture and indeed, as one of our first nations, acknowledge the role that our First Nations People had in establishing their own cultures of trade and exchange. Ni hao and Peter, thank you for your welcome here and to the ACBC event in Chinese language. It’s wonderful to be here with the ACBC and Sean, thank you very much for your leadership and that of all the ACBC members for the work that you do in helping to further Australian-China relations. Can I only acknowledge also my former Senate colleague Tim Storer? Tim, good to see you again. And indeed, predecessor Chris Schacht. Hello, Schachty. Nice always to see you and thank you both for being here today too.

Well, I’ll keep my remarks reasonably informed today and maximise the time we have for some questions and exchange and along the way. But to Sean, thank you for your framing remarks in terms of South Australia’s place in the Australia-China relationship and the importance that we have in recognising that not all aspects of the relationship, not all capabilities across the Australian economy are precisely the same from different parts of the nation. And what is now a very broad, deep relationship, we need to ensure reflects that diversity and the different challenges that exist. And certainly, we are living in some quite challenging and engaging times. I would wish to be able to wake up in the morning and not roll over and reach for my phone and have to check what the latest tweet on trade wars was overnight, or of course, where the latest outbreak of different tension or conflict around the world that is impacting upon our economic circumstances may exist. And it’s not just in relation to US-China tensions that are so evident to all, or of course, increasingly, concerns about the impact, the tensions, the situation in Hong Kong may have. We also see a range of other tensions that exist around the world – the uncertainty created by the landscaping Brexit; now we see economic tensions escalating between Japan, the Republic of Korea. A whole sequence of different partners and key relationships for Australia, where in different settings, we’re seeing new challenges emerge that are going to create obstacles that we have to carefully step our way through. We have to do that in a way, as a nation that, is consistent with and mindful always of our values and our national interest, but also critically pursue that as a country where every decision we take is about our long term national interest, in balancing all of the different factors that can impact upon that national interest.

Now, our relationship with China is one that has changed in ways that few could have foreseen or imagined just a couple of decades ago. We look back 45 years since diplomatic relations were established and since the beginning of opening and reform occurred in China, few would have thought all these years later that we would now have the strongest trading relationship of any Australia’s partners, that China would be there as our largest two-way trade partner, as our largest export partner. Few would have imagined that we would have established a comprehensive strategic partnership relationship between Australia and China. We have come an incredibly long way. Along that way, addressing often tensions in the relationship where there are challenges or clashes to value, but we ought to celebrate and acknowledge the successes that have been achieved and the fact that notwithstanding some of the doomsday headlines that I see from time to time, the economic relationship is in incredibly strong shape at present. That two-way trade remains at a record level. Our export volumes remain at record levels, but importantly it’s not just the economic relationship. The people-to-people relations continue to strengthen at record pace. The exchange of students and tourists remains central to building what will be deeper, long-term ties between Australia and China. The degree of business engagement and investment exchange remains strong and will further strengthen those ties that exist well beyond government-to-government level but critically are driven by the individuals who do business and engage between Australia and China.

And it’s those sorts of relationships that we have to really bank on to continue to underpin the strength of that relationship into the future. It’s often reflected that China now stands as the largest source for tourist numbers to Australia. What’s little appreciated it is that in per capita terms, more Australians visit China than do Chinese visit Australia. In fact, if we had a similar level of per capita tourism flows to Australia, we would be unable to cope with the sheer volume number of tourists. And that’s just one little identification of the fact that it is actually more of a two-way relationship than I think is sometimes acknowledged. But of course, I just returned from having had the chance to spend a few days in Beijing last week and I was there for the negotiations of the Regional Comprehensive Economic Partnership Agreement. This is an opportunity for us to take the work that we have successfully done around the China-Australia free trade agreement and move it to a new level, a stronger level of regional focus and cooperation. ChAFTA has been an incredible success, as Sean acknowledged. The growth that we’ve seen in terms of trade volumes and economic cooperation in the time since ChAFTA came into force has been phenomenal and that is very much to the credit of businesses and others who have led that.

We now have our exports, that record $136 billion and here in South Australia, China is the largest export market for South Australian businesses, worth around $2.5 billion. It’s the market that provides around 40 per cent of our international students – I see Karyn Kent from education Adelaide- StudyAdelaide here today – and generates around 60,000 tourists into SA. So ChAFTA provides now a pillar, a bedrock for that economic exchange to continue into the future. The RCEP negotiations that I was there before will help us to better integrate in terms of our regional economies and value chains that we can each tap into and continue to support the development of our region. Because the transformation that we’ve seen in China over the last couple of decades hasn’t just transformed the lives for many millions of Chinese people and created new economic opportunities, greater prosperity for them. It’s also transformed the lives of people across our region and created new economic opportunities in many other Southeast Asian nations. And RCEP is a construct that has been led by the ten ASEAN nations and brings together with those ten nations, six of their key economic partners: China, Japan, Korea, Australia, New Zealand and India.

And for Australia, there are two key benefits from that construct. One is that it would be the first trade agreement we could potentially strike with India and that’s important in and of itself. But the other very much is that RCEP will create a series of regional rules, rules of origin in terms of products that can allow businesses to better tap into those global supply chains and value chains and be able to have common rules of origin and enable those products to be more freely traded throughout the region of those 16 nations. And of course, collaborating to create the most productive and low cost environment for goods and services to be delivered for export out to the rest of the world. And that’s really where Australia and China are playing a leading role in helping to drive forward those negotiations. We continue, of course, to cooperate as well in a number of other areas of work, in terms of potential reforms at the World Trade Organization is important in my space as well as the work and to continue to be able to deliver on the mission and objectives of China’s development. I was pleased in discussions with my counterpart Mr Zhong Shan in Beijing, to hear him acknowledge the fact that this year as China hosts the second China International Import Expo, the registrations for that have grown most notably from one country, Australia. Our business continues to step up to the plate to recognise that events like CIIE are important to China, are important to the way in which they are shaping their growth and engagement in the world. And that our businesses are playing a key role in terms of supporting that and facilitating that. And that’s coming all from a very large bucks. Last year, particularly in terms of food and produce, we were already the largest participant and exhibitor at the CIIE and I hope to be able to return to Shanghai in November this year and to see an even bigger Australian presence at an event that is remarkable for its scale but also for its concept. Hard to imagine any other country in the world hosting an import expo where they encourage businesses from across their country to come and strike contracts to bring imports into their country. Certainly as Australia’s Trade Minister I tend to talk more about our exports than our imports. But I do acknowledge critically there’s a big role to play in terms of imports for us in our business development and in investment activities that’s critical for Australian business. But equally, China in their pursuit of especially driving increased consumer activity in their economy sees CIIE as playing a crucial role there.
So we work off of strong foundations and we work off of enormous success in recent years, that is to the credit of so many. But we do face certainly challenging times. We can’t change, nor can we seek to resolve things like US China tensions and trade conflict. We can but stick to our principles and pathway through those sorts of challenges and to make sure that the decisions we make are calm, predictable and consistent in the way we present them, and that they step towards those best interests for Australia. But also try to encourage engagement in the region and in the world from China and from the US that is also consistent with those values. Values of support for the international rules-based order, support for the sovereignty of other nations, support for the continued economic development progress of individual peoples.

So can I thank all of you for the work that you do in terms of supporting this critical relationship. Our Government’s approach is to keep building this relationship and to focus on how we can put more depth to the Australian understanding of Australia China relations. I know that ACBC will no doubt be a key partner in terms of the new Australia China Foundation that Minister Payne and the Prime Minister announced earlier this year. The foundation will provide a capability for us to look well beyond the economics of the relationship and to make sure that the depth of our understanding is strong and the depth of our engagement is diversified where it possible. And the types of contributions that ACBC can make, and to the work of that foundation will be important for us to seize and maximise the opportunities that our investment there is going to create. And so thanks again Sean for hosting today, and I look forward to the chance to take a few questions and hear a few comments from the room. Thank you very much.