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Transcript of Dr John Hewson, Leader of the Opposition Press Conference 70 Phillip Street, Sydney



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Leader of the Opposition

28 March 1991

[ ' COMMONWEALTH 1 PARLIAMENTARY LIBRARY I MICAH

TRANSCRIPT OF DR JOHN HENSON, LEADER OF THE OPPOSITION PRESS CONFERENCE 70 PHILLIP STREET, SYDNEY

E & Ο E - PROOF COPY ONLY

SUBJECT: Taiwan Trip; Trade possibilities between Australia . and Taiwan; US Bases; Disclosure of Political

Donations; Advertising Ban.

H e w s o n :

I've called this press conference to report to you on a very successful 3-day visit to Taiwan. I had the privilege of : leading a very senior business delegation and political ‘ delegation to Taiwan to investigate the potential trade and

investment opportunities that I believed existed between Australia and Taiwan, within of course the Government's existing diplomatic constraints on that relationship.

I've come home absolutely convinced that opportunities have gone begging for Australia in relation to trade and investment relations with Taiwan,, simply because the Government has got no idea how to pursue our best interests under existing diplomatic constraints. As far as I'm concerned there's potential for us in trade across the board in agriculture, in mining of course - we already have some presence in that market, value-added in both, in other manufacturing and, of

course, importantly in services. I had the opportunity of having very high level discussions with both government officials and the business community which have led us to that view.

I also believe that there can be some significant progress in the near term provided the Government' s prepared to

appropriately follow through on some of the discussions that we've had.

For example I think it's possible that we can resume wheat sales to Taiwan. They haven't taken place since 1978. I think that the restrictions that presently exist on Australian beef access to that market, and those restrictions are of two

types - involuntary quotas, if you like, and customs duty differentials in favour of the United States. I believe that we can look for some easing of those restrictions in the near term.

I also believe that we can look for some easing of

restrictions on fresh fruit exports to Taiwan, particularly apples in the near term. Parliament House, Canberra, A.C.T. 2600 Phone 77 4022 . . . / 2

MAR 28 '91 18=32 LDR OPPOSITION - SYD P.3/9

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I also think that there's tremendous scope for Australian companies to get some of the business in relation to a very large tender infrastructure programme. Tens of billions of dollars of infrastructure investment will take place under the Sixth Development Plan in Taiwan and we've had an assurance there that of course, the tendering process on that will be done on a quality and price basis, which is encouraging for a

lot of Australian companies who could participate in that. I think there are something like 800 separate projects to take place under that infrastructure development.

I also think that as a result of the establishment of the direct air link, that the tourist potential from Taiwan to Australia is tremendous. I think recently we've taken about 30,000 tourists from Taiwan. I think it's possible that we would take maybe up to 10 times that amount in the next few

years as a result of that direct air link and appropriate promotion of Australia as a tourist destination in Taiwan.

I also believe it's important that we look at other areas as : others have done. For example, it's been put to me that maybe r it is possible under appropriate arrangements to look at the exportation of uranium to Taiwan and I think that's another area where there is tremendous potential.

We had a unique opportunity really, to put our case directly. I raised a lot of direct concerns about discrimination as I saw it in trade, our trade access if you like, in beef and fresh fruits, viz a viz the trade access the United States gets in Taiwan, and we had the opportunity for very senior

level business discussions on their attitudes to investing in Australia. It was the same old story, in effect, that you get around Asia all the time that they're very concerned about

investing and manufacturing in Australia because of labour market problems, union pressures, inefficient waterfront, inefficient infrastructure. There should be a much greater sense of urgency obviously in Australia in dealing with all

those infrastructure pressures which represent major cost disadvantages on our industry and of course a major

disincentive for foreigners to invest in our industry.

So, I think it was a pathbreaking trip. It's opened up a lot of opportunities and I would urge the Government to follow through so that we don't have a situation where a lot of opportunities that do exist go begging.

Jrnlst:

what trading opportunities existing for Taiwan here?

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Hewson:

I think Taiwan has potential...I've obviously focused on it from our side, but from their side there is a lot of

potential. Look, I had the privilege of handing over a piece of sophisticated medical equipment while I was there which was designed in the University of Melbourne and developed in Australia by one of our leading professors, Professor Crock.

I donated that on their behalf to the largest hospital in Asia, located in Taipei, which was designed by Australian architects, Stevenson Turner. There's a good example of tremendous benefit to Taiwan from two pieces of Australian

trade activity - one, what we'd call a brain-based

manufacturing product, a very specialised piece of equipment in relation to cataract operations and trauma cases, and of course the design of a very sophisticated hospital by world standards, done by Australian architects. There's two-way benefits in trade. There's two-way benefits in investment and

I believe of course, there are two-way benefits in cultural exchanges. And all this can take place within the existing l diplomatic constraints of a One-China policy. -

Jrnlst:

We already have, in financial terras, more trade with Taiwan than we do with China. How much more financial potential do you think there is?

Hewson:

I don't look at it in comparison with China. „ The way I think we should conduct our foreign economic relations is to look at it in a very hard-headed, self-interested way and exploit opportunities across the board. Now, we've got tremendous

opportunities with mainland China and there's more to be done there - a point we made last year after a trip to China.

Equally, there's a tremendous amount of scope in relation to Taiwan. Taiwan has the advantage of being one of the fastest growing countries in the region and they've made phenomenal progress in the course of the 1980 's in particular. We visited one industrial park, for example, where that one park

accounts for about 4% of the world's output of computer chips. Now there's a tremendous industrial base in development that's taken place. They offer opportunities that haven't been exploited, but equally there are opportunities in all the

Chinas.

Jrnlsti

Can you give it a financial figure?

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Hewsoni

No, we didn't try to quantify it, but look, there's no doubt that in the specific cases that I mentioned that I think we could see improvement in the course of the next few months or this year, relating to wheat sales, to beef access, to apple

access, to tourism as a result of the direct air link.

They're very real benefits that can take place in the near term. How much we, down the track, can exploit those

opportunities is up to our industry and up to the follow- through of our Government.

Jrnlsti

Do you not think the Government's recent - well in December - they appointed an unofficial trade commissioner to Taiwan - is acknowledgement of what you're saying?

Hews on:

We were led to believe in Taipei that the reason all that was accelerated was because of the pressure the Opposition put on the Government here. That was announced, for example, at a very senior level business reception. The point was made that

the recent steps in relation to Australia-Taiwan relations were accelerated because of the lead we provided, and the pressure we put on the Government. X have no doubt that the

air link agreement was signed while we were there as a result of Government pressure. In fact, I think the Hawke Government tried to get it done before I got there. ^We were led to

believe that was the case. I'm not going to score points about that. All I want to say is that I'm pleased it's

happened and we'll continue to provide the lead and if there's the appropriate follow-up, there's tremendous potential in the very near tern in the areas that I've identified. I've focused particularly today on some of those agricultural

developments because our rural sector is in its worst crisis in 60 years. We need to have a massive effort across the board to open up markets to get better access to improve our export of agricultural products. We are among the most efficient agricultural producers in the world, but we often

find our access restricted for a lot of reasons. I use the example of wheat. Effectively we've been frozen out of the Taiwan market since 1978. In terms of beef - well, there are two types of quotas. There's a so-called voluntary - it's

definitely an involuntary quota put on our beef producers in terms of shins and shanks and in terms of top-grade beef. Well, we suffer a customs duty differential against us. Our beef is subject to about $1.50, whereas US beef is $1.00. So,

we put a very strong case against that sort of discrimination which effectively limits our access in two major exports, beef

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and wheat, to the Taiwan market. X think Government, in these circumstances, has to make every effort to open up markets ♦ We've done it at GATT. I congratulate what the Government's

done through the Cairns Group in relation to GATT. They've got to sustain that pressure. I've recently proposed a trade mission to the United States to ensure that our post-Gulf War market share is preserved and that US subsidies to agriculture didn't continue to be to the detriment of Australian

exporters. I think there is a need for a similar trip to Europe to put that view. I believe there is a need for a

similar mission to the Gulf and Neil Blewett did go there, but I think there's a lot more to be done. No stone should be left unturned at this time to open up markets and break down barriers and discrimination that exist as a result of the policies of Governments in other countries which freeze out

our producers.

Jrnlsti

Resuming wheat sales to Taiwan - when will that happen?

Hewsont

Look, I don't know. But, we've been led to believe that if there's appropriate follow™through there, that could take place from around the middle of this year. But, don't hold me to a date because.. .we put the case very strongly to their Foreign Affairs Minister and their Economic Minister and they, we know, phoned the Flour Millers Association who acknowledged

that our pressure had been drawn to their attention. On the basis of that we were led to believe that maybe there wouldn't be any restrictions much beyond the middle of the year which would open that market up for us. We were very encourage by

that, although there's no explicit commitment, and we are in Opposition, not Government. But there's no doubt in my mind that if the Government puts appropriate pressure now, and

there's appropriate follow-through that we can resume wheat sales to Taiwan, which has got to be a major first step.

Jrnlst:

...inaudible...

Hewson i

Look, I don't know. We didn't get into the detail of that. There are some numbers floating around but it's better that I don't advocated a particular number. I just think the opportunity is the important thing and that if our producers

take advantage of that, there's tremendous scope.

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J m l s t :

Will a Coalition Government sell Uranium to Taiwan?

Hewsont

What I've said on uranium is, I think that it's worth

investigating whether it's possible. As you know, there are a lot of restraints on international uranium trade in relation to international agreements and of course, the South Pacific nuclear-free zone agreement and so on, are other constraints on us per se. But, others do do it. The Americans export uranium to Taiwan. The French do. And there's a very strong rumour that the Canadians, who had previously been in much the

same position as ourselves, have decided to open up uranium trade to Taiwan. I think it's worth investigating whether it can be done. I'm not saying that we will do but there's

certainly a strong case, I think, for looking at whether it can be done and whether in effect, they can meet the very strict conditions, as they do in relation to the United States and whether in fact that can be done. It is a very

complicated process because of those overlapping treaties, so it needs to be investigated. I can't put it any stronger than that, but I don't start with a disposition against it. I start with a disposition in favour of doing it, provided it can be done on the terms that, say the United states presently does it in relation to Taiwan. That's what's got to be

investigated.

Jrnlsti

Do you welcome the prospect of an end to the 3 mine uranium policy?

Hewson:

Yes, we've called for it for some time. Even the Prime

Minister in his wisdom has said it's an illogical policy. We couldn't agree more and they ought to just scrap it. I hear some crazy suggestions that maybe they could partially scrap it, about three and a half mines or some stupidity. It's a

clear cut, straightforward decision in current circumstances and that is that they just ought to scrap the three mines policy altogether and open up the opportunity for further trade in that area. We've got all the restrictions that exist

as I said, on safeguards and other things, but the policy of restricting it to three mines is illogical and nonsensical and ought to be scrapped. I know it's a major issue for the

Government. I know that it divides the left wing from the rest, but it's a unique opportunity for the Prime Minister to show a bit of leadership. Given the magnitude of our trade crisis it's the least he can do in current circumstances.

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Jrnlst:

Do you see uranium as a commodity that's price is going to increase?

Hews on:

Look, that's not for me to judge. I know that in recent times the international price of uranium has fallen significantly. But what I'm concerned is creating the circumstances in which individual companies make those decisions. They've got to determine the trading potential. It's just an illogical

government restriction to have a 3 mines restriction. I think one of the big things you learn from visiting a country like Taiwan is that they have put an enormous amount of weight on creating the right environment for the business community to get on and exploit trade and development. That's what it's

about in Australia - building that sort of environment. A restriction like a three mine uranium restriction, a very cynical political decision to block Wesley Vale or Coronation Hill, even though they'll meet the toughest environmental

standards going, isn't creating the right business

environment. In fact, it's been directly detrimental to that environment. We do have a lot to learn from the attitudes of others with whom we have to compete, not only in the Asia- Pacific region but of course, internationally as well.

Jrnlst:

Don't you think it's better that Australia sells uranium to those countries that have signed the Treaty rather than negotiating bilaterally?

Hewson:

Look, I'm not pre-judging it. I'm simply saying that I understand that in effect Taiwan does satisfy those conditions and is audited by the International Atomic Energy Agency, and satisfies the United States that it meets the toughest conditions. If it can be done for the United States, and if

it is about to happen for Canada, I think it's worth

investigating whether in fact the same sort of approach can be used in relation to exports from Australia. As I say, I don't downplay the difficulty there because we have insisted in the past on bilateral agreements. We've insisted in the past on

the significance of the South Pacific Nuclear-Free Zone Treaty. They're two additional constraints that don't apply to some other countries. Nevertheless, let's see what can be done. I think it's just one area - I'm not overplaying it - which in the medium to longer term we should investigate. In

the near term, if the Government focuses on wheat and apples and beef access, they'll make a significant start.

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Jrnlsti

On another subject, Tim Fischer has said that US bases should not be ruled out when ...inaudible... Do you agree with that?

Hewson:

My position on the record is that I don't make any linkage. I've said that for quite some time. I'm aware that Tim has apparently made some remarks along those lines in a show that's to go to air tonight, 1 think. I've never supported a

linkage and I can't foresee the circumstances in which there would be a linkage. That's been my position on the record for quite some time.

Jrnlsti

Do you support full disclosure of donations to political parties?

Hewson:

Well, I've said quite clearly, and it seems that some in the media have real difficulty understanding what I've said. I've said it very clearly, that my disposition is of course, in favour of disclosure. But, in the past there's been a lot of

concern about the potential for intimidation and inequity and so I've said that I would need to see the legislation. Look, my disposition is there. I know the past and the difficulty that has existed in the past and they are very-real concerns -

issues of intimidation or potential intimidation should be a very real concern. Inequity between the parties and others involved in the process is another real concern. So, let's see what the Government's got in mind. I, however, would urge you to continue to focus on the ban. A ban on political

advertising, even exempting charities, is the single most important breach of free-speech in this country. If our democratic process stands for anything, it stands for opposing

bans like that and all Australians ought to get out and march in the street. When a desperate Government tries to change the rules and move the goalpost to its advantage in the run-up to the next election - it's a ludicrous proposition.

Thank you.