THE Coalition has embarked on the most ambitious trade agenda in Australia’s history.
In essence we want to create a framework where competitive sectors can succeed and prosper in global markets. Without a well-functioning, rules-based system, key exporting sectors will be disadvantaged.
Over the past year or so, global trade policy developments have made more headlines than was probably desirable. Some commentators, even some of my counterparts in other nations, seem to be paralysed by the spectacle of what we have seen taking place globally.
Australia’s response, though, I think has been very different. Our focus has been on intensifying work on rules-based, market-opening deals with a wide range of important trading partners.
The last few weeks provide a good example of the scale and the breadth of the trade agenda that I am pursuing on behalf of our nation. Recently I was in Mexico meeting ministerial counterparts from the Pacific Alliance countries of Colombia, Mexico, Chile and Peru.
A few days earlier, I met with my British colleague Liam Fox in London to talk about the prospect of a free-trade deal with the UK after it concludes its exit from the European Union.
Australian negotiators met with counterparts in Hong Kong to work through the last phase of talks for a bilateral free-trade agreement between Hong Kong and Australia. At the same time, we had the meeting of officials from the eleven members of the Trans-Pacific Partnership who were discussing the progress with respect to the TPP11.
Several weeks ago, our officials had the first round of talks with the European Union and in early July I had very productive discussions with my counterpart, Indonesia’s trade minister, on finalising a bilateral, comprehensive co-operation agreement between Australia and Indonesia.
Recently, Australian negotiators met their counterparts from 15 other regional economies to make a push towards the conclusion of the Regional Comprehensive Economic Partnership.
So while most of the global headlines on trade focus on the tit-for-tat escalation of tensions between some of the world’s largest economies, Australia is going about its work quietly but very deliberately to implement an ambitious and comprehensive strategy. A strategy to secure the interests of Australian households and exporters with respect to access to global markets.
As the rules-based trading system comes under pressure from above, we have carefully crafted together a network of binding trade relationships from the ground up.
The scale of this effort has been remarkable. The Coalition has concluded or has undertaken free-trade talks with countries that account for $55 trillion in terms of combined GDP.
Our agenda will give goods and services access for exporters, tariff-free, or preferential access to a market of around 3.65bn consumers.
Most of those market-opening deals have been done with the fastest growing economies in the world. Arguably, I would say this has been the most productive period in trade policy in Australia’s economic history.
Since the Coalition was elected in 2013, the coverage of our free trade agreements has increased from 26.4% to now nearly 70% of our two-way trade. By the time the current round of negotiations are concluded, we will have locked-in, binding, rules-based commitments with countries that account for 88% of our two-way trade.
This, in my view, is the most effective hedge an open trading economy like Australia can possibly have against the forces of protectionism. This agenda has made good progress in opening markets for agricultural exporters.
We have made good progress on tariff and access issues with our three North Asia free-trade agreements. The TPP11 has built on these gains by securing the elimination of Canada’s wheat tariffs from entry into force and the phasing of Mexico’s tariffs on wheat from 67% to 0% over the next decade.
I recognise and acknowledge we didn’t secure everything that we wanted in these agreements. Reviews of existing deals will provide further opportunity to expand market access in growing markets.
* Steven Ciobo is the minister for defence industry and the former minister for trade, tourism and investment
This article appeared in the September edition of DCN Magazine