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Thursday, 21 June 2018
Page: 3640

Senator GALLACHER (South Australia) (16:05): I present the report of the Foreign Affairs, Defence and Trade References Committee on Australia's trade and investment relationships with the countries of Africa, together with the Hansard record of proceedings and documents presented to the committee, and I move:

That the Senate take note of the report.

As the Chair of the Foreign Affairs, Defence and Trade References Committee, I'm pleased to speak on this report on Australia's trade and investment relationships with the countries of Africa. Right at the outset I'd like to put on the record that, like a lot of the Senate work that goes unremarked and unrewarded, it is an extremely good representation of the bipartisan, collegiate efforts of all senators who partook in the inquiries and the writing of the report. In particular, Senator Reynolds's contribution was over and above, if you like, in terms of getting people to come to the inquiries and contributing to the final outcome.

We received about 32 written submissions, and two public hearings were held, the first on 2 May 2018 and the second on 11 May 2018, in Canberra. The committee heard from a range of stakeholders from the public, private and non-government sectors, each with their unique perspective on the relationships between Australia and Africa. At the Canberra hearing the committee had the pleasure of speaking with 16 African heads of mission. Sixteen African heads of mission came to the hearing here in Canberra, and the committee would like to extend its warm thanks to all of those ambassadors and high commissioners for appearing. This showing clearly demonstrated the high regard in which Australia-Africa relationships are held.

At this point I want to quote from an article in The Washington Post in March of this year that talked about the AfCFTA, which is the African Continental Free Trade Area, which was initiated in Rwanda on 21 March:

This will be one of the world's largest free-trade areas in terms of the number of countries, covering more than 1.2 billion people and over $4 trillion in combined consumer and business spending if all 55 countries join.

So I think it is reasonably prescient of the committee to have covered the topic at the same time that this fundamental shift in trade agreements is happening in Africa. As senators may recall, the topic of Australia's relationship with the countries of Africa was covered by the Joint Standing Committee on Foreign Affairs, Defence and Trade, with their report being tabled in June 2011. Whilst the terms of reference of that inquiry were broader, the joint committee made a number of recommendations regarding Australia's trade and investment relationship with Africa, many of which were agreed to at the time by the government.

The committee was pleased to hear from witnesses regarding the recent signing of the framework to establish the African Continental Free Trade Area. Whilst this agreement is some way from being fully implemented, once in force it will not only boost trade between African countries but also provide Australian companies based in a single African country with unprecedented market access across the continent. The committee has recommended that developments in the implementation of this agreement be monitored closely so as to provide Australian businesses with the best possible opportunity to grow in new areas of Africa.

In respect of mining, the committee is pleased to note that Australia's existing trade and investment relationship with many African countries is robust, founded largely on the wide footprint of Australia's mining company operations in Africa. The committee heard that there are currently over 170 Australian mining companies operating in Africa and the current and potential investment in this sector is estimated to be worth in the order of $40 billion. The committee has recommended a review of data collection on Australian mining projects in Africa to ensure that the information on this important sector is comprehensive and up to date.

While mining itself produces a range of benefits including job creation in African communities, the committee heard from witnesses that described the ways in which Australian mining companies in Africa are working to ensure sustainable economic development for their host communities beyond the life of the mine. We heard that mining companies are focused on leaving a functioning economy after the extractive activities and the rehabilitation, with the provision of important community services of electricity, water and a sustainable agricultural base. This is really important and excellent work that is going on and is probably not spoken about and is basically unrewarded. In order to build on this positive work, the committee has recommended a review of Australian mining and METS companies operating on the African continent who undertake engagement and provide services or assistance to the communities in which they operate. As our foreign minister is very keen to look at private sector involvement in our foreign aid program, it's a really good template to have an evaluation of.

The committee was also pleased to hear that Australian companies are well positioned to assist African countries in achieving the Sustainable Development Goals. For example, the company spoke with Base Resources, Business for Development and the Cotton On group, who described their innovative Kwale Cotton Project in Kenya. This project provides smallholder farmers in areas surrounding the mine with the knowledge and skills to produce ethical cotton for sale back into the Australian market. This not only provides farmers with a reliable source of income but ensures that Australian businesses like Cotton On have access to a secure and transparent supply chain.

Witnesses spoke of the lack of energy infrastructure across many regions of Africa as posing a barrier to sustainable development. The committee heard from Australian companies such as Carnegie Clean Energy and Windlab, who have capabilities to provide solutions to many of these issues. The committee also heard that Australia's existing presence in the African mining space provides an ideal platform for these businesses to access African markets. The committee has therefore recommended a round of funding for these projects that contribute to the achievement of Africa's Sustainable Development Goals through the Department of Foreign Affairs and Trade's Business Partnership Platform.

While mining forms the cornerstone of Australia's current investment in Africa, it is by no means the only sector in which Australia is working on our relationships. Given the huge potential for growth in Australia's presence in African non-extractive industries across technology, communications, renewable energy, retail and agriculture, the committee recommended in this report that Austrade actively monitor new trade and investment opportunities in Africa for Australian businesses.

The committee received evidence about some of the barriers affecting Australia's trade and investment with the countries of Africa, including the security challenges Australian businesses may face when operating in remote regions. The committee heard examples of businesses supplementing Australian government advice with privately sourced security advice. In order to provide additional assistance, the committee has recommended a review of DFAT's Smartraveller advice platforms to ensure that tailored and specific advice is provided to Australian businesses operating in Africa.

The committee heard from the Australian Centre for International Agricultural Research, who explained that Australia's expertise in agribusiness, particularly in harsh climates, has proven to be very transferable to an African context. Through projects such as the Australia-Africa Plant Biosecurity Partnership, Australia is helping to develop a robust agricultural sector, particularly in eastern and southern Africa, and in turn strengthening the foundations for improved trade links between Africa and Australia. The committee has recommended that an increase in funding to ACIAR be considered to ensure they can continue to grow their important work in Africa.

The diplomatic footprint has been a subject of contention. While interactions with Australia's diplomatic missions in Africa for trade and investment purposes have largely and broadly been positive, these missions have a limited footprint which can present challenges for businesses operating in Africa. However, the committee noted that DFAT are currently exploring innovative and versatile new methods of diplomacy that could allow Australia to expand its diplomatic footprint in new ways. In light of this, the committee has recommended a review of Australia's diplomatic presence in Africa, with a particular focus on applying these new diplomatic methods in the African context. I seek leave to continue my remarks later.

Leave granted.