Charting Australia's Trading Future: The 1998 Trade Outcomes and Objectives Statement

Speech by the Australian Deputy Prime Minister and Minister for Trade, The Hon Tim Fischer to the NSW Chamber of Commerce, Sydney, 24 April 1998


Introduction

Thank you Katie Lahey. Members of the Chamber. Ladies and Gentlemen.

Obviously, the person who invented the idea of a `working breakfast' had not read the words of a famous English novelist William Thackeray who said last century - "Breakfast first, business next".

Mr Thackeray had a good point. Many a `working breakfast' has produced neither work nor breakfast - nor business - in any meaningful quantity, but I am pleased to see that this morning's event is not one of them. I am delighted to be here, and to have the opportunity to be part of the Chamber's innovative Business Action Program. And what I want to talk to you about today fits in well with that scenario.

The Government's Trade Outcomes and Objectives Statement is our annual report card to the Australian people on past trade achievements, and it sets the key trade objectives and strategies for the next two years. I will not have time this morning to do more than whet your appetite, but you'll find that it is worth taking time out to read the Statement. It is a genuinely `no-nonsense' document written in the sort of plain, understandable English that puts most other government documents to shame.

Trade Outcomes for 1997

I want to begin where the Statement begins - what we have achieved to date. Last financial year, Australian businesses chalked up record overseas sales of goods and services, with exports exceeding $100 billion for the first time. The merchandise trade balance showed a $1.4 billion surplus, while the services trade deficit all but disappeared.

These impressive results are a genuine credit to Australian exporters and also point to the success of the Government's integrated bilateral, regional and multilateral trade policy efforts in securing better market access for Australian business.

To cite just a few successes from 1997 - the Government secured improved access for Australian agricultural products in China, Mexico, India, Japan and the Philippines. Targeted sectoral promotions in Asia and Europe led to $200 million worth of information technology sales in Europe; $20 million in food exports to Japan; $23 million worth of building materials sales to Hong Kong, and $250 million worth of passenger ferries to Italy, Argentina and Singapore.

To further assistthose Australian companies doing business in Mexico, Russia and South Africa, we are well advanced in working towards finalisation of double taxation agreements.

In the Asia Pacific, Australia continued to push hard in 1997 for more economic reform and trade liberalisation through APEC, along with good progress in the rest of APEC 's diverse agenda.

At the global level, negotiations on financial services and information technology and telecommunications yielded significant gains for Australian businesses, including easier access to key Asian financial and insurance markets - plus tariff reductions that could add $400 million a year to Australian telecommunications exports by the year 2000. Australia was successful in using WTO mechanisms to secure India's agreement to remove quantitative restrictions by 2000 on several priority products. This could boost Australian exports to India by at least $30 million a year in the short term, and much more in the long term.

The 1998 Action Agenda : Sustaining the Momentum

This year - 1998 - we are not only building on past achievements, but breaking new ground. Of course, `hard-nosed' bilateral and sectoral trade initiatives remain at the heart of our strategy.

While we continue to press ahead in Asia on a wide range of fronts, we also have an eye on developing trade development strategies targeting Europe, North America, Latin America South Africa and South Asia. Our efforts are aimed at taking advantage of faster growth in selected non-Asian markets, and to capitalise on the price advantage we now enjoy due to the Australian dollar's depreciation against North American and European currencies.

Regionally, through APEC, the Government continues to drive the regional effort for trade liberalisation in priority sectors. Globally, we are building momentum for a new multilateral round of trade negotiations by 2000. Our global goals also include aiming to:

. Liberalise regulatory barriers in professional services trade;

. Achieve successful Information Technology Agreement outcomes;

. Defend Australia's interests in WTO Dispute Settlement processes;

. Advance Australia's interests in reviews of relevant WTO agreements; and

. Safeguard Australian trade interests in implementing the Kyoto Protocol on climate change.

Just a few weeks ago - in Sydney - Australia led the way in achieving a very positive outcome from the Cairns Group Ministerial meeting of agricultural free traders. The Cairns Group, an Australian initiative, confirmed its position at the Sydney meeting as the most successful and enduring issue-specific coalition in the multilateral trading system. The Group continues to push out the envelope on the desperate need for agricultural trade reform, particularly in markets like the EU, Japan, Korea and the US.

Australia is proud to be leading this global free trade push in agriculture, as per our efforts in Sydney. Interestingly, I would also like to draw your attention to a Thai initiative at the Cairns Group meeting. This was to include language in the final communique emphasising that "the maintenance of liberal and open world markets will facilitate the quick recovery of those countries affected" by the Asian financial crisis. This was a heartening message given the potential that exists for inward, protectionist responses to the current situation in Asia.

Challenges for Business and Government

While the difficulties of being experienced by East Asia still overshadow the fortunes of Australian business activity in the region, there are signs of a slow revival.

As many of you are aware, the Government has been active both directly and indirectly in its support to the region. Directly through its participation in the IMF "rescue" packages, and less directly through maintaining open channels of communications with the regional leadership to see where we can assist in other areas, for example through our development assistance program.

I do not believe however that business should give up on the region, even though some companies might experiencing some difficulties. For Australia, which produces many of the goods and services the region requires, East Asian markets will remain vital to our long term prosperity. The challenge lies in the perseverance of business and we in Government to stay the long haul.

The other challenge that faces us is here at home

I think we can take it as read that business and Government need to work closely in delivering economic gains to Australia through export.

That brings me to the current issue of waterfront reform. We in Government are working for business to address a set of ciircumstances that undermine the effectiveness of the "hard yards" that Australian business has put into the development and maintenance of export markets.

You can be assured that we are commited to a better deal for our exporters. The low productivity of the Australian waterfront that we experience has a cost to it that add to the cost of our exports. It is totally unacceptable to the Government that our international competitiveness is so heavily eroded by a minority of the Australian labour force - namely the MUA.

Ladies and Gentlemen, I can assure you that for this Government, there will be no turning back. Wages of $72,000 annually for non-skilled workers whose productivity does not meet international standards cannot be sustained, and will not be accepted.

Already some unions, whose members are multi-skilled, are raising their eyebrows at the gall of of the demands of the MUA.

This Government is about building Australia's prosperity, about creating jobs for all, and about a fair go for all. An important ingrdient in achieving these objectives is to create an environment in which business has confidence that its activities are not going to be disrupted by a few.

Conclusion

The message I want to give to you is that it is important for Government and business to work together to gain international trade breakthroughs, and to develop our competitiveness at home.

The NSW Chamber's Business Action Program ia an excellent illustration of practical Government-business cooperation I am talking about. I congratulate those that have put the program together - keep up the good work.

Similarly, the Howard Government is doing its part by ensuring that Australia's economic and trade policy settings are on the right track. We will continue to put in the `hard yards' at home and abroad. Our aim is to ensure that the many trade successes of the past two years are only a prelude to an even better trading future for Australia's `world class' exporters and enterprises.

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