Address by The Hon Tim Fischer MP, Deputy Prime Minister, Leader of the National Party, Minister for Trade, to the Albury "Supermarket to Asia/AUSTRADE" Forum, Albury, 3 July 1997

  Introduction

Lou Lieberman, Member for Indi, Paul Bourke, Executive Director of Supermarket to Asia Limited, Peter McNamara, Regional Trade Commissioner for Austrade, ladies and gentlemen.

It is a great pleasure to open this Supermarket to Asia /Austrade Forum in Albury.

As your local member, and as the Minister for Trade, I am pleased to have this chance to open this meeting which will discuss an important initiative of the Government, working closely with industry, which we hope will benefit our farm communities and food producers through export growth.

There are enormous opportunities opening up for our food exporters, particularly in the fast growing markets of Asia. And of course producers from this area of the country are in many cases already doing very well in the export market or very well placed to develop exports.

For instance we have in this region a great example of the diversity and quality of Australian agriculture and food - ranging from the well established meat and wool industries, dairy products such as those from the Parmalat plant, Uncle Ben's with its pet food exports, great grain and rice industries exporting successfully to some of the world's most demanding consumers in North Asia, numerous wineries of very high standard, and a horticulture industry with great potential, to newer areas of production, like emu, chestnuts and buffalo.

And of course we should acknowledge all those industries providing inputs and services to agriculture and the food industry - all critical to ensuring high levels of productivity and quality of production.

Supermarket to Asia Initiative

But as we all know, to take full advantage of the potential markets in our region, we need work much harder to remove impediments to industry competitiveness and market access. This is why the Prime Minister's Supermarket to Asia Council was established.

Australian food producers are already among the most efficient in the world. We are also lucky to have natural advantage of having a relatively clean and safe environment and highly developed technological expertise.

The work of the Council is about taking greater advantage of our natural attributes and improving our competitiveness. The Council will seek to address impediments from production in Australia to supermarket shelves in Asia.

Government and industry are working across all key food sectors, production, transportation, distribution, packaging, marketing and trade to coordinate efforts and iron out major impediments to trade.

Paul Bourke will speak to you shortly about the overall work of the Council, but I do want to say a few things about the market access agenda, as Minister for Trade, and as I am chairing the Market Access Working Group, one of eight working groups which were established to carry out the Council's activities.

The Group has already achieved some important practical results. These include appointment of a Market Access Facilitator for Processed Foods and Beverages within the Department of Foreign Affairs and Trade, a senior trade negotiator who is charged to specifically pursue your market access interests.

It includes the establishment of two new AQIS positions in overseas posts in North Asia: one in Tokyo and the other in Seoul, where they will be able to act quickly and directly to address quarantine barriers to these premier markets as well as others in the region.

Also, work has began on compiling a market access guide for exporters. This will be a good practical help for companies which do not know how to get through the maze of government and other organisations dealing with market access problems. The guide is expected to be ready for distribution in September.

We should not underestimate the opportunities on offer to our farm sector through increased exports, nor the challenges in front of us if we are to make the most of those opportunities.

I am confident that if we work together to take maximum advantage of these opportunities, we can significantly improve the welfare of our farm community, both now and in the future.

Market Access Achievements and Priorities

Market access is one of the keys to growth of our agricultural and food industry. Australian farmers are already exporting a significant proportion of their produce: around 80 per cent of wheat, 60 per cent of meat and 50 per cent of all dairy products are exported. And there is plenty of scope for extra production to get on a ship and into overseas markets.

But getting into overseas markets is often not easy. Agricultural producers in many countries remain protected from international competition by extensive regulation through product, health, quarantine and labelling standards, rigorous inspection processes, and high tariff and non tariff barriers.

With the exception of the most open markets such as Singapore, Hong Kong and Brunei, these impediments are both significant and diverse, particularly in Asian markets.

Against this background, the Government is working hard through its range of bilateral contacts, though APEC and through the World Trade Organization to improve market access for Australian agricultural and food products. And we are achieving results that translate into real dollars for our agricultural producers and exporters. Let me give you some examples.

On wool, we have achieved some very good outcomes for Australia: Mexico agreed to remove its 10 per cent tariff on all wool, including scoured wool, wool tops, wool noils and waste. This resulted in some $6 million in the trade between 1995 and 1996, with further rapid growth expected in 1997.

Korea has extended its zero wool tariff for six more months from 1 July 1997.

And India and China have lowered their wool tariffs.

Successful market access negotiations in the context of Bulgaria's accession to the WTO secured access for Australian exports of hides and skins worth $5 million.

Dairy industry has also been a real success story of the last decade.

Recently we have negotiated easing of quarantine restrictions for fresh milk in Hong Kong. Fresh Australian milk is now being air freighted daily to Hong Kong.

Malaysia has reduced its tariff on liquid milk to zero.

Thailand, where Australia is a key supplier of powdered milk, now applies a zero tariff up to a quota of 88,000 tonnes of this product. We are also enjoying an increased SMP quota in Thailand.

We also had some significant wins in the area of meet and live cattle trade.

We were also able to overturn decisions taken by some EU countries last year, in response to the BSE crisis, that would have barred Australian exports of certain beef and sheep products.

Removal of technical barriers relating to certification arrangements with the countries in the South East Asia has seen trade in live cattle grow from $96 million in 1991 to nearly $140 million in 1996.

Korea has agreed to extend the official shelf-life of frozen sheepmeat, frozen beef and frozen chicken and other processed foods and beverages.

Jordan has removed discrimination affecting Australian sheepmeat.

Bulgaria's accession to the WTO, which I already mentioned, resulted in the additional global tariff quota of 11,000 tonnes worth over $21 million.

Australia is well placed to utilise a good part of this additional access.

Late last year we completed long-running market access negotiations with Taiwan in the context of Taiwan's accession to the WTO.

One of the major achievements of those negotiations was that Taiwan, after it joins the WTO, will gradually eliminate the tariff discrimination that Australian beef is facing now in Taiwan vis a vis the US and Canadian high quality beef.

But we don't have to wait for Taiwan's accession to see at least some improvement, because Taiwan also agreed to a cut in the tariff line that applies to Australian beef which will represent a forty per cent cut in that discrimination. We are keeping pressure on Taiwan to achieve early implementation of this outcome.

And for the first time, we gained access in 1996 to the French and Irish markets for kangaroo meat.

In the area of horticulture, Taiwan agreed to open new quotas for Australian citrus, peaches and plums, and doubled the apple quota ahead of it's accession to the WTO. Exports of these products are already taking place.

And a final, but not less significant example, the door has been pulled ajar for our rice exports to Japan and Korea.

Of course, there are many other examples of the successes we have had, and not only in the market access area. Subsidies on exports and production overseas have been contained, benefiting in particular our grains sector.

But I would be the first to recognise that there are as many trade problems remaining as those we have solved and they affect a very broad spread of products and markets - so the work in front of us is very substantial.

Conclusion

In conclusion, the Supermarket to Asia initiative represents a very significant opportunity to ensure that we all work together to make the most of the very exciting challenges that await us in the region. But to be successful it needs the involvement and commitment of you, the people actually producing and exporting the product. With that, let me now ask Paul Bourke to address you on the work of the Council and how it can support local initiative.