Interview, Squawk Australia
Transcript, E&OE
13 April 2010
(Introduction made by Gerardo RUIZ MATEOS, Secretary of the Economy)
Main Topics - Latin America visit, Doha, Chinese currency revaluation.
AMANDA DRURY: High level trade talks are under way in Latin America this week with the Cairns Group holding discussions aimed at advancing the Doha Round of free trade talks.
The region is also one of Australia's fastest growing trade partners and joining us now from Mexico City is the Australian Trade Minister Simon Crean, still with me in Sydney is our guest host Chris Caton from BT Financial and, of course, we have Sri (Jegarajah) in Singapore.
Minister it's a real pleasure to have you on the show, thank you very much for your time.
Let me ask you first of all, why exactly is Latin America so important to Australia?
SIMON CREAN: Well it's a very big market in its own right. It is projected to have strong growth going forward and we already have a strong commercial presence in many parts of Latin America. So in the bilateral sense, there are many opportunities to advance. Importantly, Latin America has also been a very strong advocate for conclusion of the Doha Round and we can reinforce that message and inject the political will. Visiting Mexico is also important because of Mexico's presence in the G20. Interestingly, Latin America is also because a number of Latin American countries are also interested in the Trans-Pacific Partnership - and this is a mechanism, a multi-faceted agreement aimed at getting greater trade liberalisation in across the Pacific - so I think there are a number levels in which we've been engaging and it's an important visit simply because it holds so much potential and with countries with which we hold so many common values.
AMANDA DRURY: Minister, is it realistic though to be able to clinch a deal on Doha considering how long it has taken to try to move this forward?
SIMON CREAN: It's always realistic if the political will exists, Mandy, and I think that the G20 have shown a determination to conclude. Why? Because trade is an economic stimulus that doesn't hit the budget. It's also the best insurance against any further spread of protectionism, so it's got a lot going for it in terms of being part of the global solution to sustainable recovery.
Now that being said it is difficult because there are a number of sticking points which have proven quite difficult - not intractable, but difficult. But the leaders of those G20 countries have said that they stand ready to become engaged to resolve the differences. Our task is to try and get the agreement closer to the point that if we do need to have them engaged, we don't clutter them with a whole range of technical issues. So that's really the challenge going forward. But at the same time we can't just put all of our eggs in the basket of Doha.
It's by far the most important agreement outcome to secure because it gives the greatest benefits. But at the same time, there are big regional opportunities, particularly in Asia, where Australia is very well placed and where we've opened the door to a free trade agreement involving a number of countries with ASEAN.
We can extend that opportunity and that itself opens up important market access opportunities for the countries in Latin America so it entrenches the basis upon which we engage them bilaterally.
AMANDA DRURY: Right.
SIMON CREAN: All of these things connect. We've got to help countries understand how we join the dots.
CHRIS CATON: Mr Crean, can I take you to the other important issue, the issue of Chinese currency revaluation. It appears - I mean this is going to happen some time... it's really only a question of when - whether it's next week or some month from now. Is it a big deal in your view, from the point of view of Australia?
SIMON CREAN: I think it is important because a constant message I've been giving the Chinese as well as all of our Asian colleagues - without lecturing them about what they should do specifically with their currency, which seems to be what annoys them - is to remind them of how it is that Australia has been able to become as competitive as we have and one of the reasons was because we were prepared to float our dollar.
I also think it's true that China going forward knows that it has to develop greater consumption in its domestic economy and if it's going to do that it's in their interest not to have an overvalued exchange rate. So I think the question of dealing with this is trying to engage them on the fundamentals rather than lecture them on the outcome and I do believe that China will move at a time of their choosing...
AMANDA DRURY: Minister?
SIMON CREAN: ...I don't know when that will be but I think...
AMANDA DRURY: Minister?
SIMON CREAN: ...that the whole dynamic, the whole change that's taking place there gives me confidence that they do understand the importance of adjusting.
AMANDA DRURY: Minister I'm sorry I've got to jump because otherwise the ad break will. Trade Minister Simon Crean joining us from Latin America.
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