Unlocking China’s Services Sector

Australia will be seeking a very strong outcome on services in its negotiations on a possible free trade agreement with China, the Deputy Prime Minister and Minister for Trade, Mark Vaile, said today.

The Deputy Prime Minister was launching a new report from the Department of Foreign Affairs and Trade, Unlocking China’s Services Sector.

“Australian companies have made significant gains in China’s services sector since it joined the World Trade Organization in 2001. The latest statistics show that our services exports to China increased by 23 per cent in 2004-05 to more than $2.3 billion. China is now our sixth largest market for services exports,” Mr Vaile said.

“The report warns that further reforms to China’s services sector are still needed. There are still burdensome licensing and operating requirements in many areas; China’s regulatory and legal processes are often opaque. The enforcement of intellectual property rights is also a well-known problem. For example, the report concludes that 92 per cent of the software used in China is pirated.

“Our FTA negotiations with China are an important chance for us to deal with these barriers and make it easier for Australian firms to work in China. It would create jobs, boost our exports and introduce new ideas and skills into China’s economy.

“We will be looking for strong outcomes in areas such as legal services, where Australian firms are unable to enter into joint venture arrangements with Chinese firms; tourism, where Australian operators face excessively high business turnover requirements; and telecommunications, where China has restrictively interpreted its WTO commitments. There are many other areas as well,” Mr Vaile said.

Australia’s services exports to China include education, banking, insurance, telecommunications, tourism and travel, and professional services such as legal, architecture and accounting services.

The report can be ordered at www.dfat.gov.au/eau or by phoning (02) 6261 3114. Media copies of the report can be obtained by emailing bill.mckinley@dfat.gov.au

Contact: Richard Forbes 02 62777420