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Transcript of interview with Stan Grant: ABC TV: 24 January 2017: Trans-Pacific Partnership (TPP); President Trump; Australia's free trade agreements with North Asia and the US; Labor's betrayal of the free trade legacy



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THE HON STEVEN CIOBO MP Minister for Trade, Tourism and Investment

TRANSCRIPT ABC TV, 7.30

TUESDAY, 24 JANUARY 2017

Subjects: Trans-Pacific Partnership (TPP); President Trump; Australia’s Free Trade Agreements with North Asia and the US; Labor’s Betrayal of the Free Trade Legacy

E&OE….

STAN GRANT: Minister, thanks so much for joining us. You're in the United States, Donald Trump has said that signing away the TPP is a great thing for the American worker. What's the reaction been there from the people you've spoken to?

STEVEN CIOBO: Well, it's been mixed. I mean, clearly, where I've been in terms of New York there's a level of disappointment about the decision, but I should say it's not an unexpected decision and the Americans themselves appreciate that. But like any democracy, Stan, I think there's a variety of different views.

STAN GRANT: You'd hoped to resurrect or revive this, you'd hoped that you could still salvage something. Is it now finished?

STEVEN CIOBO: Well, no. What the conversations that I've been having have been about a reformulated TPP, what you could call a TPP 12 minus one. In other words, the opportunity to capture the gains that we've been able to secure under the agreement of the Trans-Pacific Partnership, but less the United States. There's still an appetite from a number of countries including Canada, Mexico, New Zealand, Singapore, and others to look at what we could be able to come up with that would still capture those important gains around trade facilitation and the efficiencies for small business, et cetera, but do it within that TPP framework.

STAN GRANT: Is there really an appetite, though, to stay in if the US is not there? We've heard from Shinzo Abe - Japan is the biggest remaining economy - and he’s said in the past the TPP is no value without the United States. Countries like Malaysia and Vietnam have signalled that it's effectively dead without America.

STEVEN CIOBO: Well, I think things have moved on. The fact is that I've had conversations over this past week with trade ministers from, as I indicated, Canada, Mexico, I know Chile and Peru has a view, New Zealand, Singapore, Japan, and

others and the fact is that there is a desire to try to capture the benefits of the TPP that's been formulated in the agreement that we reached, but, which now the United States is walking away from. It comes down to this, I mean, from Australia's perspective, we already have a free trade agreement with the United States. Under the TPP, we'd be able to have access to markets that we don't have a trade agreement with including, for example, Canada and Mexico, so of course it's very much in Australia's interests to be able to capitalise on the gains that we've made.

STAN GRANT: You say - that you could constitute a TPP 12 minus one, it's not just a minus one, is it? It is the biggest economy, the deals were often constructed around the potential access that countries would have to the United States. Would it not have to be completely redrawn?

STEVEN CIOBO: Well, take, for example, as I said, Australia's case. We already have a free trade agreement with the United States. The fact is that we have multitudes of benefits that flow to Australia, access to markets like Canada and Mexico, including Peru and others, and the fact that we're able to get harmonisation of rules, that we're able to lower the compliance burden on a number of potential businesses that want to export. Stan, never forget this is about benefiting small and medium sized businesses. I mean, the big guys could always hire in the expertise, they could hire in the lawyers, they could hire in the people they need to facilitate trade, but those Aussie businesses, those small to medium enterprises, they're the ones that benefit from having one set of rules that apply across 11 or 12 countries, and they're the ones who stand to gain the most.

STAN GRANT: Again, on the question of those Aussie businesses, when it was signed, we heard from the trade minister then, Andrew Robb, saying this was a great deal for Australia, it would be a great deal for Australian business, but what is the hit now that potentially could come from the United States opting out of the TPP?

STEVEN CIOBO: Well, look, a number of countries will go through their own calculations about what the impact is. I was very buoyed this past week, to have had conversations with a number of trade ministers from a number of different TPP countries, who, as I said, were still very focused on trying to capture the benefits that we were able to agree. In Australia's case, again, I make the point, we already have a free trade agreement with the United States. This was also about providing opportunity for enhanced market access into markets like Japan for our beef or Canada and Mexico, so this is part of a conversation that we'll have to go forward with from now.

STAN GRANT: The TPP was not just a trade deal, part of it was a geopolitical impact in the region reasserting the United States’ role in the region. China was not part of the TPP. It was seen, potentially, as containing China's rise. What does this signal now to the region about the United States and its commitment to Asia Pacific under Donald Trump?

STEVEN CIOBO: Well, Stan, I think you're inviting me to provide commentary on what the decisions and implications of the United States will mean with respect to China and Asia more generally, and I, of course, am not going to do that. What I'm focused on is pursuing our national interests, what I'm focused on is pursuing good

outcomes for Australian workers, good outcomes for Australian exporters, preferential market access of the type that the Coalition has already delivered into important north Asian markets like China, Japan, and Korea. That's the track record of the Coalition and that's what I'm going to continue to focus on.

STAN GRANT: Is that, in fact, the message out of this? Donald Trump has said that he's putting America First. Is that the message for other countries now, you put your own country first, Australia puts itself first? Is that really a productive way to move forward?

STEVEN CIOBO: Well, I always think we should exercise caution about the way in which we phrase things. Of course, as Australia's Trade Minister, and trade ministers before me, we'll always put Australians first. That is the whole reason why you do a deal, but the reason I talk about exercising caution is because I want to reject emphatically this notion that trade deals are about winners and losers. That's not how it works. Good trade deals are about producing win-win outcomes. It's about opportunities to grow the trade pie. It's about opportunities to get more Australian goods overseas. We have seen big increases in Australian export volumes, in fact seen last year, a lot of Australians' growth being underpinned by enhanced market access. Stan, this is the reason why we've got to stay focused on building these opportunities for more trade for Australia. That's part of the reason why I'm so concerned, frankly, that Bill Shorten has been so weak and willing to walk away from the TPP, when it requires, frankly, a little bit of elbow grease.

STAN GRANT: Okay, I'll come to the domestic political situation in just a moment on that, but just a thought from you about China. Does this now open the door for a greater role for China to play in this region when it comes to trade. Given it wasn't part of the TPP, but now that the United States has opted out, what role does that create, potentially, for China?

STEVEN CIOBO: Well, China's Australia's largest trading partner. We've got two-way trade worth roughly $155 billion. We run a good trade surplus with China and that's a big positive for our country. What China decides to do is ultimately, of course, a decision for China. From Australia's perspective, I'm going to continue to open market access. We're in negotiations right now with Indonesia and I hope to conclude a trade agreement with Indonesia this year. I'm also having conversations, and we hope to formally commence negotiations, on a free trade agreement with the European Union around the middle of this year. Conversations with the UK, conversations with India are ongoing, so we've got a number of pokers in the fire, and these are all good outcomes for Australia.

STAN GRANT: Just finally then, are you going to proceed to have this ratified in the Parliament?

STEVEN CIOBO: Well, I'm certainly going to keep that option alive because we need to see the way in which discussion will go now between the other 11 countries in the TPP. I want to, basically, get Bill Shorten and the Labor Party to have a bit more backbone when it comes to trade. We've seen in the past Bill Shorten and the Labor Party go to water at the request of their puppet masters, the Trade Union Movement, on the China-Australia Free Trade Agreement. And never forget Stan, that that China-

Australia Free Trade Agreement has seen record volumes of exports from Australia and we potentially would've lost it, if Labor had lost their nerve. They're losing their nerve now on this issue as well and that's not good for Australian exporters, it's not good for Australian jobs, and we need to make sure that the Labor Party have a bit more of a stiff backbone about these sorts of issues.

STAN GRANT: Just to clarify that you do want to put that legislation ratifying the TPP even with the United States not in the deal?

STEVEN CIOBO: Well, what I said is that we're going to keep that option alive because we don't know where discussions are going to go over the next couple of months and that's part of the reason why we need to make sure we retain flexibility. And that's precisely the reason why we shouldn't do what Labor's suggesting, which is to go weak on trade and to walk away from it.

STAN GRANT: Minister I appreciate you giving us your time again. Thank you.

STEVEN CIOBO: Pleasure. Thanks, Stan.

[ends]