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Wednesday, 24 March 1999
Page: 4165

Mr ADAMS (9:43 AM) —It has taken some time for me to get to speak on the Customs (Anti-dumping Amendments) Bill 1998 and the Customs Tariff (Anti-Dumping) Amendment Bill (No. 2) 1998. The last time I spoke on these bills was in May 1998. At that time, I was concerned about the time it was taking to implement the Willett anti-dumping recommendations. Now we are nearly into April—another year on after the legislation was first put into parliament—and the passing of these bills is still to be done and in the meantime we have had an election.

The debate started in 1996 when the Willett report was submitted to government in September with four major recommendations. Then nothing happened. We had to put in a private member's bill to try to put these recommendations in place, and still nothing happened. Three months later, a response was announced which closely matched Labor's. But despite all the delays, it is still important to get this under way quickly.

In 1997 bills were introduced to implement changes to the way goods sourced from China are treated for the purpose of anti-dumping complaints. China has been treated as a command economy and, therefore, when goods sourced from China are subject to anti-dumping complaints, the domestic price is determined by reference to a surrogate country.

In 1996 the Minister for Trade accepted a proposal that China's goods be treated as coming from a free market in future anti-dumping cases. The 1997 and 1998 bills respond to the situation created by this decision. They introduced a new economy in transition category which allows goods to be considered on a case-by-case basis. The opposition proposed amendments and the bills were amended in the Senate, but they were not passed before parliament was prorogued.

I have taken a particular interest in these measures because of the terrible situation facing our paper mills in Tasmania. It was quite obvious to all and sundry that Indonesia was dumping paper pulp on Tasmania and there were grave concerns expressed about the future of many people's jobs in the Australian paper industry.

As it was, many fears were realised with the closure of the Amcor pulp mill in Burnie and hundreds of jobs disappeared. So great was the disgust of the community that when the election intervened they tossed out the sitting member for Braddon and replaced him with Sid Sidebottom, my current colleague, who will speak later in this debate. I suppose there is some rough justice in that, but it is much harder to replace jobs that have been axed than to try and keep them in place through some intervention, legislation and assistance. So the Indonesian situation was far from resolved.

To add insult to injury, a written undertaking was given by the minister to the National Association of Forest Products Industries Communities that Customs would not notify the Indonesians of the results of the study and its recommendations. They were only supposed to receive the figures for verification. This has now been broken again by the department.

They were given the assurance that any overseas investigation into Indonesia would not repeat the last inadequate inquiry. It was also pointed out that there was a need to adopt a surrogate country to determine dumping margins. We have a situation now that is likely once again to threaten the paper making industry in Australia. If Indonesia can still dump, then many other similar style economies could easily develop arguments to dump too; China included.

So these bills were seen as being very crucial to the ongoing well-being of many Tasmanians involved in the forest industry. Yet we have seen the legislation held up and the minister procrastinate to such a degree that the bills have gone through the lives of two parliaments yet still we have not had some sort of protection for our workers in Australia.

The purpose of the bills this year is still to amend the Customs Act 1901 to provide a special approach for determining the normal value of allegedly dumped goods from countries that are in the process of transition to a market economy, when it is established that the selling price of these goods is subject to government control.

Also the purpose of the bills is to provide a new methodology for determining the normal value of allegedly dumped goods where the goods are exported from a control in the process of transition to a market economy, and a raw material input into the goods which accounts for more than 10 per cent of the costs of producing or manufacturing the goods is supplied by a state-owned enterprise. This is the provision which was not in the original 1997 bill. It was recommended in the report of the Senate Economics Legislation Committee. A further purpose of the bills is to clarify provisions of these acts which relate to the manner in which interim dumping and countervailing duties are collected.

As I recall when the 1997 bills were introduced, there were four concerns raised by industry with the proposed special approach for determining normal values, and these were taken up by the opposition and moved as amendments.

Under the 1997 bills, a price control situation was not taken to exist where government controlled, substantially controlled or influenced more than 10 per cent of the cost of inputs to production. Industry wanted this to be included.

The 1998 bills have dealt with this issue by defining a price control situation to include cases where a raw material input into the goods which accounts for more than 10 per cent of the cost of producing or manufacturing the goods is supplied by a state-owned enterprise. It should be noted that this is the second substantive amendment referred to above.

Under the 1997 bills a price control situation was defined as one in which the domestic selling price of the goods is controlled or substantially controlled by government. Industry wanted the definition to include situations where price is directly or indirectly controlled, or substantially controlled or substantially influenced by government.

Under the 1997 bills industry wanted to include a regulation making power to allow the minister to make regulations deeming price control situations. If a price control situation does exist under the 1997 bills, the minister could use the surrogate country method of determining the normal value of the allegedly dumped goods, but had a discretion to use any other method. Industry wanted only the surrogate country method to be available.

The major amendments proposed provide for a tightening up of the time scales and the way in which investigations are treated and creates a new body, the Trades Measures Review Office. But it also removes provisions allowing Australia to take retaliatory countervailing action against another country. It is claimed that this is contrary to our WTO obligations. I believe there are many products that have been similarly affected.

Australia is very open to dumping because we have lowered most of our tariffs and lowered or dropped our bounties on a range of goods. Yet we are still allowing subsidised imports from other countries. This has had a terrible impact on Australian pig farmers and many have gone to the wall during the passage of legislation aimed at trying to overcome this problem.

While the market problems are not entirely caused by subsidised imports, these have had a disproportionate effect compared to their actual volume. If there had not been the open slather imports from September 1996 to December 1997, then that particular crisis would not have occurred. Dumping is being allowed in the so-called interests of free trade. This does not make sense and it is sacrificing a good and keen market.

These bills are even more important in light of some of the evidence from the inquiry into the possible treaty concerning the Multilateral Agreement on Investment. Here we were being launched into the global market by our Treasury people without having a clue what sort of effect this would have on our local trade. This is the report I spoke of earlier in the week.

This was all done in the name of free trade. I have my doubts. When I look at the cartels around, I wonder who was really making the deals and who the deals were being made for. But being susceptible to dumping is just as bad. Without some legislation to enable us to control what comes into our country, the prices of our resources and maintaining the standards that are being sought now in world trade, we really could be accused of raping our own country. What the opposition is trying to achieve with the amendments is to try to avoid goods coming in the back door. However, the government appears to be supporting some sort of check on dumping while sending out information by the backdoor to help our country's competitors compete against us. I support the amendments.