Speech

Thank you to the Australia-Arab Chamber of Commerce for the invitation this evening

• and for the opportunity to make some remarks to this distinguished audience of visiting business colleagues from Saudi Arabia and Australian companies doing business in the Middle East.

To all members of the visiting business delegation I extend a warm welcome to Australia. 

It is particularly gratifying for me as trade minister that you have included a visit to Australia in your busy schedules - to see first hand the excellent goods and services trade and investment opportunities we have to offer. 

I shall return to this theme in a moment.

But first let me pay tribute to the unstinting commitment of our business chambers to building ever stronger and deeper links

• in particular our gracious hosts this evening the Australia-Arab Chamber of Commerce and Industry.

The Chamber’s links with the General Union of Chambers of Commerce, Industry & Agriculture for Arab Countries underlines its standing in the Middle East

• and gives it the capacity to engage at a high level with its regional counterparts.

My Department and Austrade value the Chamber’s close links with the region and with Australian businesses with an interest in the Middle East

• and work closely with the Chamber in developing their Middle Eastern trade agenda.

The Australian Government values highly the contribution of our Arab communities and recognises that Australia’s relations with the Arab world are important to us.

For this reason it has been actively promoting issues of mutual interests between Australian and the Arab world through the Council on Australian Arab Relations (CAAR) - established by Mr Downer and myself in December 2002. 

Visits by the council to Egypt, Morocco, UAE, Saudi Arabia and Lebanon and visits by key figures and opinion makers from the region under the auspices of the CAAR have been designed to promote a deeper understanding of Australia in Arab countries and vice versa

• one of the Council’s initial activities, in June 2003, was to sponsor a visit to Australia by Mr Usamah M. Al-Kurdi, of the Saudi Shura Council. 

From Australia’s point of view, the Council it is an important means through which to highlight the diversity of Australian society and the contribution of the Australian-Arab community to Australian life

• to promote Australia as a welcoming and reliable destination for education, tourism, medical services, trade and investment 
• and “demystify” the Arab world for Australians.

Ladies and gentlemen

Australia’s commercial relations with the region go back over fifty years

• and Australia has a well-deserved reputation as a reliable supplier of quality foods and industrial supplies over that half century.

The region takes over one third of Australia’s wheat exports, around half of our live animal exports, over 20 per cent of our cheese exports last year, and 60 per cent of our motor vehicle exports.

The region’s role as major petroleum exporter also makes it an important contributor to economic growth, both in Australia and globally

this gives us a shared interest in the development of global energy markets.

But we should not forget that Australia was exporting complex manufactures, including motor vehicles, to the region decades ago.

With exports of motor vehicles to the Gulf countries exceeding $7.6 billion over the last five years, Australian motor vehicles are becoming an increasingly common sight in the region

• and particularly in Saudi Arabia, the destination for two-thirds of these quality motor vehicles.

There is no doubt that a sluggish world economy and geo-political uncertainty created a tough environment for exports in 2003.

For Australia, the lingering effects of drought, a rising Australian dollar and the impact of SARS in our region have also had an impact

• and our trade with the Middle East has not been immune from these recent challenges. 

But with the effects of the drought receding in Australia, and firm global growth expected in 2004, including in Middle East countries, I am confident of a return to strong export growth in 2004.

Ladies and gentlemen

Saudi Arabia is a key focus for Australia in the Arabian Peninsula because of its long term economic, political and strategic importance to the region, as a major oil exporter, and as a trading partner. 

It is also a key contributor to regional, Arab and Islamic affairs. 

Saudi Arabia was Australia's 14th largest export destination in 2003, and our 28th largest source of imports. 

In addition to being a major market for Australian motor vehicles and dairy products, Saudi Arabia is also a substantial market for barley and meat products. 

It is a growing market for fresh vegetables, refined metals and ICT products. 

There are also over 3,000 Australian citizens employed in Saudi Arabia - many as technicians in health, education and other specialist areas. 

Australia warmly welcomes Saudi Arabia’s recent and constructive efforts to accelerate its WTO accession and the new momentum in the negotiations. 

The WTO remains Australia’s top trade policy priority – we strongly believe that it is through WTO negotiation processes that the greatest gains will be won

• particularly as the most intractable problems in global trade - especially agricultural subsidies - need resolution through multilateral channels, with all key subsidisers acting together to remove distortions.

Saudi Arabia’s WTO membership will further expand bilateral trade opportunities

• and enhance the scope for Australia and Saudi Arabia to work together more closely to promote global trade liberalisation within the multilateral trade framework.

We were pleased to settle our bilateral accession agreement with Saudi Arabia on tariffs and services issues three years ago.  We have several remaining concerns relating to non-tariff measures, which we hope can be resolved quickly.

A key outstanding issue for Australia is the need for Saudi Arabia to put in place SPS measures which are consistent with WTO requirements.

Ladies and gentlemen

Both of our countries have an interest in ensuring that our trade grows in size and expands in scope.

To achieve that objective, we need to ensure that bilateral trade is conducted in a way which meets our needs and serves both our interests.

In recent months, difficulties have again arisen in regard to the livestock export trade to Saudi Arabia.

Saudi Arabia has been an important market for Australian live sheep exports.  Those exports, in turn, are of particular economic and commercial importance to rural and regional Australia.

I visited the Kingdom in December to seek a robust and durable basis for regulating the livestock export trade.

Since then, my officials have twice been back in Riyadh, trying to make progress on negotiating a Memorandum of Understanding, an arrangement which would give us a solid basis for resuming the trade, and which would ensure that past concerns did not recur in the future.

We need an agreement of that kind if the trade is to resume, and, for our part, we are ready to negotiate the detail at any time.

Ladies and gentlemen

On my first visit to Saudi Arabia, in February 2000, I led a large and diverse business delegation

• to demonstrate that Australia is serious about expanding its trade relationship with the Middle East
• and to promote Australia as an economically and politically stable investment destination. 

We look to you to take home the continuing - and might I say growing - good news story about Australia as a reliable and friendly business partner and source of a diverse range of quality goods and services.

Our work to build on trade and economic relations with the Middle East forms an important part of Australia’s broader ambitious trade and economic agenda. 

Let me share with you just a few details of that agenda. 

As I noted earlier, multilateral liberalisation through the WTO remains our top trade policy priority. 

But while we are focused on making advances at the multilateral level, Australia’s robust economy and governance strengths also mean there are excellent opportunities to pursue at the bilateral level.

We are capitalising on this by concluding FTAs and other bilateral initiatives where it makes sense to do so

• as well as working through regional fora to advance our trade and economic agenda.

The Australia-US FTA is a truly great achievement in this regard. 

And the AUSFTA complements our FTAs with Singapore and Thailand, our work to enhance economic and trade links with ASEAN and through APEC, and our economic and trade frameworks with Japan and China. 

Ladies and gentlemen

Our wide-ranging and ambitious trade agenda is possible because the Australian economy and our business environment are up to the challenge – and are clearly highly attractive to our economic and trading partners. 

The Government’s sound economic management and program of structural reform have ensured that conditions for business and investment are excellent.

Australia is enjoying the longest unbroken period of economic growth since the 1960s

• and economic growth is continuing apace – the forecast is for 3.75 per cent in 2003-04
• inflation continues to be low, as do interest rates and unemployment.

For interested investors and business people, there is much to entice them to the Australia market:

• reform of business taxes and indirect taxes have given Australia a modern, internationally competitive taxation system
• these reforms have been accompanied by significant improvement to the labour market and in industrial relations.

With a strong efficient economy Australia has been well-placed to embrace the opportunities and address the challenges of globalisation - and withstand the worst effects of challenges such as the Asian financial crisis

• and thereby remain a reliable and efficient supplier of goods, services and resources
• as well as a sound location for investment.

Our economic reliability and reform credentials have not gone unnoticed internationally.

• over the past year the IMF, the World Bank, the World Economic Forum and the OECD have highlighted the competitive, productive and business-friendly economic environment that this has created.

Conclusion

Ladies and gentlemen

I wish you every success for your visit to Australia and once again congratulate the Australia Arab Chamber of Commerce and Industry for this excellent initiative in arranging your visit. 

As I noted at the outset of my speech, Australia’s commercial relations with the region go back over fifty years.

Now we look forward to the next fifty years – and, with your assistance, to continued growth and diversification in our trade with the Middle East region. 

Australian capabilities in areas such as agricultural and mining technology, and a wide range of services including health, construction and education are highly suitable to regional requirements

• and all offer many opportunities for Australia, Saudia Arabia and other partners in the Middle East. 

Again, I encourage you to look at everything the Australia has to offer during your visit - its economic strengths, its cultural diversity, its transparent and efficient regulations

• conditions for business which are second to none among advanced economies.

Thank you.