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Opinions are divided over securing a free trade agreement with the United States.

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Thursday 19 September 2002



Opinions are divided over securing a free trade agreement with the United States.



HAMISH ROBERTSON: Is it pie in the sky, or bird in the han d? 


These are the two differing opinions about Australia's chances of securing a free trade agreement with the United States. 


The Federal Government remains confident about the possibility of a deal, despite attempts by the powerful American farm lobby to put a stop to the idea. 


But the Labor Party says the Government should direct its efforts into chasing achievable goals. 


Rachel Mealey reports. 


RACHEL MEALEY: If the United States were a goose, the golden egg for Australian exporters would be a free trade agreement. 


The Howard Government says two signatures on the dotted line would be worth up to $4 billion a year for the Australian economy. 


Trade Minister, Mark Vaile, says it's still an achievable goal. 


MARK VAILE: We've always said that this is a tall order in terms of embarking upon a very challenging negotiation. We knew all along that there would be difficult areas and of course the American Ag sector has always been an area of concern. 


RACHEL MEALEY: Twenty farm lobby groups have written to the US trade representative, outlining their objections to achieving a free trade agreement with Australia. 


Their joint letter says the US should aim to reach a multi-lateral agreement at the World Trade Organisation, rather than wasting time on a deal down under. 


Adding to the lobby group's clout is the congressional election, due in November. 


Despite these factors, Trade Minister Mark Vaile says a bilateral agreement hasn't been derailed. 


MARK VAILE: I can assure you there is significant support in the Congress, both in the House and the Senate, and enormous support in the private sector, as well as the administration, for us to go ahead with this. 


RACHEL MEALEY: The Minister says multilateral and bilateral negotiations can take place at the same time. 


MARK VAILE: We believe that we're fairly clever in Australia, we believe that we can walk and chew gum at the same time. 


RACHEL MEALEY: Craig Emerson is the Opposition spokesman on trade. He says the Federal Government should choose a path and stick to it. 


CRAIG EMERSON: It's one thing to say we can walk and chew gum, but where is the logic in both of those being pursued simultaneously. How does America explain to Europe and Japan that it's doing a special preferential deal between Australia and the United States on agriculture?  


I mean, why wouldn't America say the best way of proceeding is through the multilateral, because that's how we can get some concessions out of the European Union and Japan, but the Government doesn't accept that logic, it just seems completely clear to me that that's what the American position will be. 


RACHEL MEALEY: Experts in the field of trade are also divided about what might be the eventual outcome. 


David Orden is a professor of agricultural and applied economics at Virginia Tech. He's from the camp which says a free trade agreement between the two countries has been stymied.  


DAVID ORDEN: As an observer from the outside, I think it will be very difficult to move forward if we trade with an Australia that has significant agricultural trade mobilisation in it, and that may make it get in the water. 


RACHEL MEALEY: But Alun Preece, a lecturer at the University of Queensland's school of law, says the lobbying effort of US agricultural groups is a predictable response, and its influence can be overcome. 


ALUN PREECE: I think if they were not powerful, then the United States would not have ended free trade agreements with Canada and Mexico because these special interest groups will always oppose any free trade, because they think it make life a little bit more difficult for them. 


HAMISH ROBERTSON: Law lecturer, Alun Preece.