Transcript
7 June 2009
Door Stop Interview, Bali, Indonesia
Subjects: Cairns Group Ministerial Meeting; Export Subsidies; Doha Round; Australia-Indonesia FTA discussions; ASEANANZ FTA; trade deficit; Trans Pacific Partnership.
SIMON CREAN: Well, thank you for coming. We're here obviously for this very important meeting of the Cairns Group. The Cairns Group has been at the forefront of pursuing ambitions for agriculture in terms of the Doha Round, including the need to find new impetus to conclude the Round.
Indonesia has taken a very important decision to agree to host this meeting, and we thank them very much for that. The significance should not be lost, Indonesia is the chair of the G33 Group in the WTO, a very important grouping of developing countries and of course us as the Cairns Group, those two groups have significant influence within the WTO. But we have also issued invitations to other important guests and we have present with us the new US Trade Representative, Ron Kirk, and the new Minister for Commerce from India. India and the US of course are critical in trying to bring about a conclusion to this Round.
So we do have the opportunity not just to meet, but I think to develop a framework going forward, if we can reinforce the political will to conclude this round. My very firm belief is that the round can be concluded, and it must be concluded. It's important to give stimulus as part of the solution to the Global Financial Crisis, it's important to ensure that we conclude to stop any of the trends to protectionism from taking stronger hold.
But we can't conclude it unless we've got the combination of technical work being done to conclude the very difficult outstanding issues and the political will to drive it. And I hope that this meeting today reinserts that political will and starts developing an agenda going forward given that we have got important meetings coming up, the OECD meeting in Paris at the end of the month, the G8 meeting, the APEC meetings, the G20 meeting. There is a lot of opportunity for political engagement going forward, hopefully what we can do is to give instruction through our leadership to our officials to task them with trying to conclude the detail that will enable the round to be concluded, and to continue to report progress to us as we engage at this level of political activity.
QUESTION: The political will that you're talking about, would seem to have taken a bit of a blow with the dairy export subsidies, do you have any comment?
SIMON CREAN: I do - the dairy export subsidies are very unfortunate but the fact is that they are legal under existing WTO rules. If Doha is concluded, they will not be legal in the future. It is the best example that you can give as to how concluding Doha will stop the spread of protectionism. The dairy subsidies that the US has announced are in response to what the EC announced earlier. We warned of this retaliatory action and we have argued very strongly against it. So of course we will continue to reinforce that message. But the most effective discipline against that activity happening is a conclusion to the Doha Round.
QUESTION: When do you expect the conclusion of the Doha Round?
SIMON CREAN: I've always avoided trying to put a timetable on it. And I think it's also the case that in the past, when we've tried to structure outcomes around big formal gatherings of Ministers, a whole lot of expectations are raised. What I hope this exercise does is to enable a more informal basis for political dialogue and commitment. If that works, we can find a number of opportunities going forward in the coming months where that political engagement can continue to occur. But, we need the direction from the Trade Ministers to trade officials, and a parallel track to getting the resolution. Political will, technical engagement.
QUESTION: So what are the chances of realising the Doha Round before the WTO Ministerial meeting in late November?
SIMON CREAN: The Ministerial Meeting is a meeting that is required to be held on a regular basis. Its purpose is not to conclude the Doha Round. What will determine whether we can conclude the Doha Round is the extent to which we can get active political engagement and active political instruction to our officials to resolve the outstanding issues.
QUESTION: Do you expect much progress in bilateral talks between (inaudible) Indian and US representatives?
SIMON CREAN: I think so, I think that always with these difficult outstanding issues it's the face to face engagement that matters. The opportunity presenting itself where people can not just air their differences, but seek to resolve them. I think that the circumstances in which we meet now is quite timely, but it's also the fact that the G20 leadership has instructed us to conclude. We can't conclude unless we engage at the political level and the engagement at the political level simply can't be in the big forum type engagement that we were unsuccessful at last year in Geneva. We need to find creative new ways for those face to face meetings. We need to understand that we've done a lot of work, we've got 80 percent of the deal done. We don't want to backtrack on that work. But we need to build upon it. We can only build upon it if we have the face to face meetings, and if we engage collectively, and, I believe, at an informal level. Let's see how that process works. It's a new approach, but it's built round the fundamentals that we've made huge progress to date, that the world needs a solution to Doha, because it provides new economic stimulus and it also is the best protection against the spread of protectionism. We've got a political will from all of the key players to want to conclude this, and a realisation of what the sticking points are. So let's try and use all of those positives to address the difficulties, and do it with integrity, and face to face.
QUESTION: (inaudible) are you seeking bilateral trade agreements?
SIMON CREAN: We will continue to talk with Mari Pangestu in the bilateral discussion we have about how we go forward with the report that we have, the economic study into the feasibility of an FTA. You'll recall that when the Indonesian Ministerial meeting occurred in Australia in February of this year, there was a real desire to move forward, not just as a Free Trade Agreement, but also to address capacity building and development issues. We welcome that, but both Governments at this stage are still assessing the consequences of the feasibility study, but I think there's a strong desire on both our parts to progress it and progress it constructively.
QUESTION: When do you think that (inaudible)?
SIMON CREAN: Well, you've got elections over here. We'll talk to Mari about the timing but I'm very pleased. And the other thing I should point out is that the decision in February to move forward was also based on the fact that we have concluded a new platform for engagement with Indonesia. We've concluded the ASEAN Free Trade Agreement. And the bilateral engagement that builds on the platform that the ASEAN Free Trade Agreement provides is a very important opportunity for both countries to move forward as well.
QUESTION: (inaudible)... trade deficit. How do you, what's your expectation for the rest of the year?
SIMON CREAN: Well the figure for the trade deficit was the monthly figure, and the monthly figure only records values of our exports. Clearly there has been a huge drop in the prices paid for our resource base. And you would expect there to be a big impact in terms of the value of our exports. But the interesting thing is that the figures that came out the day before, the quarterly figures on the balance of payments, also show the volume effect. And for the quarter to March, volumes of our exports had in fact increased, and not only to China, but even to countries like Japan, in recession, and Korea, that has also been having economic difficulties. Why? Because these countries are investing heavily in infrastructure, these infrastructure investments are having a big impact on demand for our resources. So, Australia's export performance has put us in good stead. They were part of the reason why we were able to avoid the technical recession. But there were many other aspects that we undertook in terms of our domestic economy. The big fiscal stimulus, into consumption, into investment into infrastructure, into skills. Consumption is obviously important in keeping economic activity going, and it was a major reason for us posting a positive growth figure for the quarter. But a lot of the investments that we are undertaking, in terms of our infrastructure for example, isn't just designed for the purpose of getting us out of recession, it's also investing in the future drivers of economic growth. If we're to be a more effective, efficient exporter, we've got to invest in our infrastructure, we've got to invest in our skills, we've got to invest in innovation. Nations that invest more in their skills grow stronger. Nations that invest more in their infrastructure grow stronger. Nations that invest more in innovation grow stronger. So these are big investments in securing our economic future and our economic future, because of the size of our population, is heavily dependant on how well we can trade with the rest of the world. That's why for us, trade negotiations are important, it's why we have to open markets, but we also have to be competitive and productive at home to take advantage of those market openings.
QUESTION: In March the US decision (inaudible) Trans Pacific Partnership (inaudible)?
SIMON CREAN: They haven't put it on hold, they're still making the decision, as I understand it, as to how they proceed with it. They've got a lot on their plate. And, they've got a number of bilaterals themselves. They've obviously got Doha and we're delighted that the US President and the US Trade Representative have both indicated very strongly that they want to conclude Doha. The Trans Pacific Partnership I think is an important concept for us to try and grapple with in the Asia-Pacific region. So we will have opportunity to raise those issues going forward with the US as well.
ENDS
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