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Prime Minister discusses LNG contract with China; Commonwealth Games; and the Dalai Lama.



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8 July 2002

TRANSCRIPT OF THE PRIME MINISTER THE HON JOHN HOWARD MP RADIO INTERVIEW WITH MIKE CARLTON, 2UE

Subjects: China LNG contract announcement; Commonwealth Games; Dalai Lama

E & OE………………………………………………………………………………………..

CARLTON:

The Prime Minister put the finishing touches to those talks when he visited Beijing this year met the Chinese leadership and I think it’s probably fair to guess that he’s delighted with the result. Mr Howard’s on the line from his Sydney office. Good afternoon.

PRIME MINISTER:

That would be an understatement.

CARLTON:

Yeah, it’s huge isn’t it?

PRIME MINISTER:

It is. It’s a great outcome and there would have been times over the past few months when I didn’t think it was going to happen and the consortium didn’t think it was going to happen. But this is the sort of thing that will nourish our export earnings for years into the future. It’s a great credit to the Northwest Shelf Consortium and I also want to thank David Irvine, the Australian Ambassador in Beijing, he’s done a great job. It’s been a real team effort and a number of my ministerial colleagues over the years have gone there and I, as you know, went there with this as my main focus in May. And I was particularly pleased at the reception I got and I was delighted yesterday to get a letter from the Chinese Premier, Zhu Rongji, informing me that the Australian consortium had been awarded the contract. So, it’s a great Australian team win.

CARLTON:

I must say it’s a gold medal…

PRIME MINISTER

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PRIME MINISTER:

It is…yes I said that is gold. But I mean, I think there’s a certain symbol in this that this country is about sporting effort and we welcomed the Commonwealth Games team to Sydney today, but it’s also about economic effort. And if we can turn in gold medal performances like this on the trade front, then we’re underwriting our economic future in a very big way because we have huge reserves of natural gas. But it’s quite a competitive world market and it’s tough. There’s no point in going in to the all the detail, but it was a very tough competition.

CARLTON:

Against Indonesians and Middle East…

PRIME MINISTER:

Yeah, but you’ve got to bear in mind that one of the major multi-national companies is involved both with our bid and also in the Indonesian bid…

CARLTON:

BP…

PRIME MINISTER:

Yeah look it’s tough, but I mean I’m pleased. I’m not gloating, I’m just very happy for Australia that it’s come about and I do pay tribute to everybody who was heavily involved. And I think it does mean this that we have a good sound relationship with China. There’s a level of trust there. There’s a level of maturity in the relationship. I don’t go overboard about China and China doesn’t go overboard about Australia, but we work together and where there are areas of common interest, we try and pursue them. And I have seen Australia’s exports, we have seen rather Australia’s exports to China, double over the last five years and it really is becoming a major export destination for this country. And we have to do this. We don’t want to put our economic or export eggs in one basket. I mean, here’s an example of getting a huge market in the Asia Pacific region. But we’ve also got to try over time, if we can, negotiate a free trade agreement with the United States so we get more access there. There’s no one single magic bullet as far as Australia’s trade future is concerned, you’ve got to try and get it everywhere.

CARLTON:

Prime Minister just give us, as ordinary people like us, an idea of what it means to the economy, jobs, investment [inaudible].

PRIME MINISTER:

Well it’s export income, which is good for the balance of payments and I mean, it’s $25 billion over a period of 25 years, potentially, I mean I can’t sort of…don’t call me back in 25 years and say - look you know, you told me…

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CARLTON:

If we’re both here in 25 years…

PRIME MINISTER:

We’ll get away with murder.

CARLTON:

You’ve just upset Peter Costello…

PRIME MINISTER:

No, no. But look, the point is that when you from one single source if you get on average a billion a year in export income, that’s an addition of the balance of payments. It’s a continuity of jobs. It’s a continuity of investment, particularly for Western Australia. The mining industry is not as labour intensive as some other industries, but there are a lot of service jobs involved in the mining industry. And I understand that as a result of this it might be that they have to extend the infrastructure of the Northwest Shelf and build what is strangely called another train, which is in effect it’s an extension of the capacity and that itself would involve an additional investment of another 1.5 billion over the next few years, if that comes about…

CARLTON:

And the Chinese are going to invest as well too, aren’t they?

PRIME MINISTER:

They’re going to have some equity and that is to be negotiated and we’re going to also offer a facility for training and advice in relation to the mining industry, similar to what the Federal Government and the Western Australian offered in relation to another - the Channar project in Western Australia, and that involved the investment of a few tens of millions of dollars. So, the very good thing to me about this, well there’s many good things, but it is a great metaphor for a strong trade relationship for our country and it comes 30 years after diplomatic recognition…

CARLTON:

That’s right it was in 72’, wasn’t it?

PRIME MINISTER:

1972, so there’s a certain symbolism about it.

CARLTON:

Yeah, indeed. Was it touch and go for a while? I think after your visit in May, everyone’s pretty much down played we mightn’t got this if…

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PRIME MINISTER:

Well I think it’s one of those things where our feelings surged and plummeted right through. I can... at various stages I didn’t think we were going to make it and other stages I got a bit excited. So, it went up and down. We were in very regular touch with the joint venture and we were in regular touch with our Ambassador. And what you, we all must understand when you’re dealing with many countries, the involvement in an advocacy way of governments is very important. It’s more important in relation to a country like China than it would be for example in relation to a country such as the United States.

CARLTON:

Good thing you didn’t have lunch with the Dalai Lama a few weeks back, isn’t it?

PRIME MINISTER:

Well I happened to be in China when the Dalai Lama was in Australia. And I was in fact, when I addressed a meeting of the cadres of the communist party training school, and they actually attacked me for allowing the Dalai Lama to come to Australia. So I pointed out, everything’s relative. I said I’ve been attacked in Australia for not having lunch with him and you’re attacking for even allowing him to come to the country.

CARLTON:

Yeah, point taken. Do you see a closer, do we see, a closer relationship in trade with China now, something on a more formal basis. I don’t know about a free trade agreement, but something in that direction?

PRIME MINISTER:

I don’t know that that is necessary. I think what you... you have to see what unfolds. I have a totally flexible and completely non-ideological view about trade, you get opportunities where you can. I don’t know that we necessarily have to go out and seek a formal framework. We have supported China’s accession to the World Trade Organisation and the deal, the bilateral deal we made with China will be quite good. China’s a very good customer now, I mean they’ve taken a lot of wool and it’s just soared ahead, I think they’re forth or fifth now as an export market, which is very good. But it will grow, I mean the thing about China is that as China becomes progressively more middle class…

CARLTON:

And wealthier.

PRIME MINISTER:

And wealthier, it will want to buy more of what we have to offer and it’s predicted that by the year 2010 the number of Chinese tourists coming to Australia will exceed the number of Japanese.

CARLTON:

Alright, Prime Minister, thanks very much for your time, appreciate it. [ends]