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Transcript of interview with Natalie Peters and Michael Pachi: 2GB Sunday Evening: 10 April 2016: Australia Week in China (AWIC); trade with China; Austrade; royal commission into banking sector; Australian Securities and Investments Commission (ASIC)

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THE H ON STEVEN CIOBO MP Minister for Trade and Investment




ts: Australia Week in China (AWIC), trade with China, Austrade, royal commission int o banking sector, Australian Securities and Investments Commission (ASIC)


NATALIE PETERS: Trade Minister Steven Ciobo on the line from Beijing. Minister, I know you've just landed so we appreciate your time.

STEVEN CIOBO: Thank you.


HI: Steve, how important is Australia Week to the economy?


EVEN CIOBO: Look, this is really important. This is Australia's largest ever trade del egation. We've got about 1,000 delegates from the small to medium size businesses, as well

as some of the large corporates. These are people who've shelled out to participate in this trade delegation to China because they recognise the tremendous opportunity of doing trade with China, being able to export to China, to invest in China, in both goods and services.


PACHI: So that's a very important point that you made there. Business people have actually shelled out their own cash to head to China to network.

STEVEN CIOBO: Absolutely; and in many respects this has been a key part of the focus of the Coalition. Obviously my predecessor Andrew Robb did an outstanding job as Trade and Investment Minister. He secured the free trade agreement with China, one with Korea, one with Japan. This is really opening up all sorts of preferential market access so Australian businesses are able to export goods and export services to these three north Asian powerhouse economies.

MICHAEL PACHI: Now the PM, he's going to be pressing the flesh with Chinese leaders and business groups. What exactly is Malcolm Turnbull's role in Shanghai and Beijing? Is he there to help clinch some of these deals?

STEVEN CIOBO: Look, of course. Having the Prime Minister travel to China just reinforces how significant our trade relationship is with China. Of course, China is Australia's largest trading partner. We've got two-way trade worth around $160 billion per annum. To

have the Prime Minister visit as well just reinforces the strength of the relationship between Australia and China so it's really important. Of course, it helps to build good will, but also creating good will by having, as I said, more than 1,000 business delegates - myself, Richard Colbeck, the Minister for Tourism, Josh Frydenberg is the Minister for Resources and Energy - a strong presence because we want to continue to build trade with China. The reason why we

want to do that guys is because it drives employment and it drives economic growth back in Aust


MICHAEL PACHI: Now, there is a story in today's Herald suggesting taxpayers are forking out $300,000 for this lunch the Prime Minister is going to be attending. Look, is this over the top, or is it just the price of doing business?

STEVEN CIOBO: Well, I think we've got to keep perspective on these things. This is going to be a lunch with around 2,000 people attending, so 2,000 people of which there's around about a thousand very influential people from China who are involved in government, involved in business, involved in academia, as well as those that are involved in some of the Chinese government Communist Party sections. So we're talking about very good access. Now

, $300,000, it is a lot of money. We're always crucial and prudent about how we spend taxpayers money, but the fact is that the Australia Week in China, last time we ran it, generated more than $1 billion worth of export sales, generated more than $3 billion worth of inve

stment, so frankly the amount that we're investing in what is the most significant event on the calendar for this week is fairly modest when you consider, one, that there's 2,000 people, and two, off the last event that we did, Australia Week in China, we saw over $1 billion worth of exports.

MICHAEL PACHI: Exactly right. As I mentioned earlier, a lot of those dairy deals that I remember that were done, they were just one of many deals that were done at the time.

STEVEN CIOBO: And we will see a continuation of those types of deals this week, I have absolutely no doubt. There are in fact a number of events that I will be presiding over, official signi

ng ceremonies, but also opportunities to make introductions, to network, to find business relationships, and let me stress again too guys, this isn't just about the big corporates. It's not just about the largest businesses in Australia. The vast bulk of people that are coming, they're from small and medium sized businesses across Australia. They're from the Western suburbs of Sydney. They're from Queensland, from Victoria. We're talking about operations that are saying, you know what "We've been providing this good or we’re doing this service in Australia. Can we start to export this?" You know, and that's terrific because the more that we export, the more wealth that we generate for our nation, the more jobs we create in Australia. This is what free trade is all about. It's about boosting economic growth.

NATALIE PETERS: We're speaking to Trade Minister Steve Ciobo about the Australia Week in China. He's on the line from Beijing. Now what do you expect to be achieved this year, minister? How many deals are likely to be done?

STEVEN CIOBO: (laughter). Look, a great question.


TALIE PETERS: Can you put a number on it?

STEVEN CIOBO: No. Not ahead of the week, maybe ask me after the week's done. But certainly from speaking with some of the delegates and sort of getting a sense from them ahead of the week, what they’ve thought they'd be able to do, there is a high level of aspiration, a high level of ambition about the kinds of deals that will be done, and excitement

around some of the contacts that they'll make here in China. Look, I have absolutely no doubt that this Australia Week in China is going to see a new record in terms of export sales, it's going to see greater opportunities for investment. That's going to drive employment back at home, and this is really good news for the Australian economy and really good news for Australian employment.

NATALIE PETERS: Putting the dollars and the numbers aside, as you say it's a bit hard to pre dict, but I'm guessing also it's the relationships, as you say, the contacts that are going to be

ar fruit in terms of profit and employment down the line.

STEVEN CIOBO: You know what we can't do, guys, is we cannot become insular. We can't think, "Oh, well, let's close ourselves off to the world and let's just focus on doing business with ourself and only with ourselves. This is part of what concerns me a little bit, frankly, about

Bill Shorten’s approach, and we saw recently his comments about Australia's steel manufacturing. Now,we want Australian steel to be super successful. We know that we offer good quality steel. It's a great product. But we can't turn around and say to the rest of the world, "You know what, we're not going to buy any steel off of you. We're only going to buy Australian steel." Because if we do that guess what the rest of the world will say back to us? They'll say, "Well that's fine guys. If you want to just shut yourselves down, so be it. We'll do the same thing". What that means is we won't be able to export goods and services to foreign countries, because they'll say, "No, we'll just buy local".


PACHI: Okay, but on that issue, Steve, what has been done to address these concerns? We have heard about the success of the services industry in China, like a lot of Australian aged care and financial services sectors moving in to China and education also. But there does seem to be some concern that the country is buying less of our iron ore and steel, putting pressure on the miners, and this week Arrium - it's been forced into administration. What do you think can be done to address these concerns?

STEVEN CIOBO: There's a couple of things that we need to do. One, we need to play to our strengths. Now, we know that we produce very good quality steel so we've got the opportunity to be able to better niche-market Australian steel for those high-quality, value-add building projects. The second thing is what the Coalition Government is already doing, and that is we're bringing forward some steel purchases. We've already announced the fast tracking of the upgrade of the rail line between Adelaide and Tarcoola. It's some 600 kilometres worth of track. That's going to create demands for steel, but we'll see other opportunities as well. Can I tell you, one of the most important things that we did? Was we abolished the carbon tax and the reason that's important is because, there is of course a lot of carbon and electricity generated as a consequence of manufacturing steel. If we still had the carbon tax in place, that steel would be even less competitive and that would mean they’d be

facing a much tougher ride, and the madness of course is that the Labor Party intends to reintroduce the carbon tax if they're elected, which will simply mean that exporters, steel manufacturers will be less competitive than they are today and that's the worst thing that could happen.

NATALIE PETERS: Minister, for business owners listening now who aren't in China and don't have a ticket at that table this week, is it getting easier for them to do business in China? Is a week like this making it easier for other Aussies to do business or is the red tape still there if you're not really involved this week?

STEVEN CIOBO: Look, it certainly is getting easier because it's becoming more familiar. The fact is every time we do one of these trade missions, you know more Australians make

more contacts in China and vice versa. That's opening up opportunities increasingly. We also see more active chambers of commerce, both in terms of Australia-China chambers of commerce as well as China-Australia chambers of commerce depending on which country you're in. That's all about building people to people and business to business links. The other agency that plays a really key role, of course, is Austrade. Austrade is our key government agenc

y that's there to help those looking at export or those looking to find out more information about export, and Austrade is building their database of contacts in China, as well as building their database of exporters or potential exporters in Australia. Each of these incremental gains, which ultimately over the long run, is great news.

NATALIE PETERS: Just on one final topic before we let you go. I know that Chinese companies are using Australian knowhow in the financial services sector as well, so how do you think that the Chinese will respond to Labor's push for a royal commission into the sector, which is something we will no doubt see more headlines about this week?

STEVEN CIOBO: Well I'm not sure it will have a big impact in China other than, perhaps, to create a little bit of uncertainty. I think Australians recognise - we know that the banking system has some faults, but you know what it's also important to keep it in perspective. The Australian banking and financial sector was one of the most stable sectors through the global financial crisis. I mean it kept Australia well and truly in good, stable footing when the rest of the world was having a meltdown. Fundamentally, we know it's pretty solid. That's not to say there's not more that could be done-

NATALIE PETERS: And there's a lot more that could be done for consumers as well?

STEVEN CIOBO: Well, that's it, and this is the point I was just about to make, which is that we have a tough cop on the beat with ASIC and so of course ASIC plays a fundamental role, as well as the banking ombudsman, to making sure that we've got people in place to monitor and to prosecute where there's activity that is wrong or that isn't customer-focused, but ultimately, the best way to get better customer service is through more competition.

NATALIE PETERS: Trade Minister Steven Ciobo. Best of luck getting those deals over the line this week and thanks so much for your time tonight.

STEVEN CIOBO: Thanks for the interest, guys.