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Labor calls for new trade strategy.



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FOR MEDIA

CRAIG EMERSON Member for Rankin

SHADOW MINISTER FOR INNOVATION, INDUSTRY AND TRADE

26 March 2003

Labor calls for new trade strategy

Labor calls on the Government to develop a new trade strategy since the current one is not working.

Australia recorded several trade ‘outcomes’ in 2002 that the Trade Minister, Mark Vaile, did not dwell on in his Outcomes and Objectives Statement speech today.

Last year Australia’s exports fell by 2.4 per cent, the largest fall in almost 50 years and bigger than the fall during the East Asian economic crisis (see chart).

That means less jobs for Australians.

The Government tried to blame the drought, but much of the fall happened before the drought started to impact on our exports and also occurred in products unaffected by drought.

The Government also tried to blame the global economic downturn, but Australia’s dominant market, East Asia recorded three per cent growth in imports in the first 10 months of last year, while Australia’s non-agricultural merchandise exports to the region fell by two per cent.

Australia also recorded its largest ever monthly trade deficit and largest ever current account deficit last year.

By the end of 2002, the current account deficit hit 6.2 per cent of GDP, perilously close to the 6.4 per cent reached during the 1986 balance of payments crisis.

News also emerged that the funding crisis in the Export Market Development Grants scheme is getting worse, with over 1,000 exporters likely to receive less than 50 per cent of their second tranche entitlement.

The Government is short-changing exporters across the country while claiming a target of doubling the number of exporters.

2

The Government achieved another first in 2002, being the first government in the post-war era to explicitly tie trade policy with our security alliance with the United States while trying to justify a preferential trade deal with the US.

Last year saw the Government obsessed with pursuing a trade deal with the United States and distracted from the main game of trade liberalisation, the Doha Round of multilateral negotiations.

Last year also saw the Government continue its secrecy and disregard for public involvement in trade negotiations.

In 2002 the Trade Minister flatly refused to debate the Government’s objectives for a US-Australia free trade agreement in Parliament.

It was only after pressure from Labor that the Government released its own objectives, months after the United States released theirs.

And last year it was Labor that initiated the current Senate inquiry into the US-Australia FTA and the General Agreement on Trade in Services (GATS) because the Government’s negotiations on both were being conducted in such secrecy.

With ‘outcomes’ like these, it is time the Government developed a new trade strategy.

Growth in Australia's exports of goods and services, 1962 - 2002.

-5

0

5

10

15

20

25

30

35

40

19 62 19 64

19 66 19 68

19 70 19 72

19 74 19 76

19 78 19 80

19 82 19 84

19 86 19 88

19 90 19 92

19 94 19 96

19 98 20 00

20 02

Per cent

Source: RBA, ABS.