Media Release
The Hon Simon Crean MP - Minister for Trade
1 June, 2009
Trade and Economic Reform delivers $3900 a year for Australian families
A new comprehensive study has measured the sweeping benefits of broad trade liberalisation for Australian households.
The study found that trade liberalisation over the past 20 years benefited the average working family by up to $3900 a year.
The study shows Australia’s GDP has been boosted by between 2.5 per cent and 3.5 per cent over the past two decades as a result of trade liberalisation.
This translates to an extra $2700 to $3900 in real income each year for the average Australian family.
Launching the publication “Benefits of Trade and Trade Liberalisation”, Trade Minister Simon Crean said the report sent a strong message in the midst of the recession.
“This study shows trade liberalisation and has boosted real household income by up to $3900 a year.
“That’s extra spending money for every family and shows how trade improves living standards and welfare of our community.
“This study confirms that more one in five Australian jobs - or almost 2.5 million positions - are trade-related.
“This study shows the concrete benefit of trade liberalisation and is a strong reminder that Australia needs to remain engaged with the world - not retreat from it - in the face of the global recession.
“That’s why the Government is committed to an active program of trade liberalisation to open up markets for the benefit of Australian companies, workers and families.
“There are opportunities for Australian companies to grab market share as well as position themselves for the global economic recovery,” he said.
Mr Crean said the study was further evidence that resorting to protectionism was the wrong way to go.
“Protectionism would hurt Australian households and Australian jobs.
“That is why the Australian Government has protested so strongly against the United States’ Buy American campaign and the reintroduction of dairy export subsidies by the European Union which led to the retaliatory action by the United States.
“Engaging in this downward spiral of tit-for-tat protectionism will reduce Australian living standards and cost jobs.
“We are determined to fight protectionism at home and abroad,” Mr Crean said.
The study by the Centre for International Economics (CIE) showed Australians were, on average, wealthier and had higher skilled jobs thanks to trade liberalisation and economic reforms undertaken between 1988 and 2008.
It showed the increase in Australia’s GDP and real income relative to where it would have been if there had no trade liberalisation.
The study analysed Australia’s manufacturing sector and found average real wages in manufacturing were $3000 higher due to a shift to more highly skilled jobs. Overall, it concluded that lower levels of industry assistance have produced “a more dynamic manufacturing sector”.
The study is available at www.dfat.gov.au
Media Inquiries: Mr Crean's office 02 6277 7420 - Clinton Porteous 0403 369 588 - Departmental Media Liaison 02 6261 1555