Interview with Cathy Van Extel, ABC RN
Cathy Van Extel: Dan Tehan is the Minister for Trade and Tourism. Good morning.
Dan Tehan: Morning, Cathy. Wonderful to be with you this morning.
Cathy Van Extel: Well, the great southern lockout is finally over, but the question is, will the tourism sector continue to limp along until international tourists are back in bumper numbers, which could take years, of course.
Dan Tehan: Look, obviously, the sooner we can open up in Australia the better, and we're beginning, and have begun, the reopening internationally as well, and all that means is that we're going to get a very safe reopening, which is wonderful news for our tourism industry. And all the forecasts are, when it comes to domestic tourism, by the end of next financial year it will be back to pre‑pandemic levels and then international tourism will follow on the back of that.
So, there's positive, positive signals for our tourism industry and, of course, we will be reopening to international students, tourists from South Korea, Japan, and also those working holiday‑maker visa holders very shortly as well. So all the signs are really positive.
Cathy Van Extel: The signs are positive, but I've seen a figure that about eight per cent of tourism businesses at the moment are back up and running full time, so a very small number fully operational again. The Christmas season, of course, will be strong, but I think many seem to be nervous about sustaining the recovery beyond the school holidays. There's a particular issue around staff shortages. I think there's a shortage of 3700 positions: chefs, hotel staff, dive instructors. What kind of priority will be given to workers who are needed to power up the tourism sector when our borders are reopening?
Dan Tehan: Well, we're giving them priority, because you're absolutely right that the biggest issue at the moment for the tourism sector and the agricultural sector is that skilled shortage. So there's been record investment, obviously, into developing skills here in Australia, but also it's why we've prioritised in the next reopening international students, working holiday‑maker visa holders, and all the other skilled visa holders coming back into Australia, because we understand that they're absolutely critical to ensuring business has the skills that they need and the workforce they need to be able to drive the economic recovery.
Six hundred and sixty thousand jobs in our tourism sector ‑ we want to make sure that that reaches beyond post‑pandemic levels in the near future, and we need those overseas skills, which have always been part of our tourism sector, here in Australia, helping us rebuild strongly the tourism sector.
Cathy Van Extel: Dan Tehan, could we go to another issue, and that is the looming shortage of suitable diesel fuels. Australia has, I believe, five weeks' supply of the chemical called urea, which is used in the diesel additive Adblue, and without Adblue, the freight and logistic sectors will grind to a halt. What are you doing as trade minister to try and secure more supplies at the moment?
Dan Tehan: Well, what we're doing is we're approaching key overseas markets to see what supplies and what stocks there are of urea and how we can get them to Australia. We forecast that there's about seven weeks of supply at the moment, and so what we want to be doing is making sure we continue to increase the supply chain.
So I've spoken to my Indonesian counterpart, there is some supply in Indonesia which we should be able to access over the coming weeks. There's been representations that have been made to Saudi Arabia, to the UAE, to Qatar, and also to Japan. There's a taskforce which has been set up by the Prime Minister, which Angus Taylor is heading, which I'm participating in. We're also working very closely with the sector here in Australia ‑ Incitec Pivot, the NFF, the Australian Transport Association, and others ‑ to make sure that we're all seamlessly working to ensure that this supply of Adblue will continue for the foreseeable future.
Cathy Van Extel: How worried are you that you're not going to be able to secure enough supply? I think the Chinese export is until at least May next year. How worried are you that trucks may be forced off the roads?
Dan Tehan: Look, with the planning that the taskforce is doing and the approaches that we've been able to make to overseas markets, we're confident that we will be able to have the supply going forward that we need as a country. There is, obviously, issues around container shipping disruptions that we're also working through, but we're ‑ from everything that we're seeing, there is clear supply there which we can bring to Australia and given we've got seven weeks' already in stock, we're very confident we'll be able to get the urea into the country that we need.
Cathy Van Extel: As you say, you're talking with the trucking industry. Is there a discussion around rationing as well?
Dan Tehan: Look, there's no discussion around rationing. What we have said is that what we want to make sure is that the purchasing continues at normal levels as best we can, because there's been ‑ always been about seven to 10 weeks of supply in the nation, and when purchasing levels have been at normal levels, then the systems work perfectly. What we -
Cathy Van Extel: So you're worried about hoarding, are you?
Dan Tehan: Well, what we don't want to see is people or companies storing excessively, because we want to make sure that the supply chain, as best it can, can continue to operate how it normally operates. And in the meantime, as I've mentioned, we will continue to approach overseas markets to ensure that those supply chains are working and that we are getting the supplies of urea into the country that we need.
Cathy Van Extel: So businesses, obviously, need to store, but what you're saying is that they just need to continue with the same kind of approach they normally would take? Is that what you're saying?
Dan Tehan: That's absolutely correct. There will always be some storage, so some stock which they keep in warehouses, but what we don't want to see is the excessive warehousing of Adblue at this stage while -
Cathy Van Extel: We don't want the toilet paper version of Adblue, is what you're saying.
Dan Tehan: Well, Cathy, that's ‑ you could put it that way. What I would say is we just need them to be using the normal methods that they've always used in terms of their warehousing, and we will continue to work with industry and with the overseas markets to ensure that the supply will continue at the normal levels that we need to underpin our transport sector.
Cathy Van Extel: So 80 per cent of Australian supplies have been coming from China, and so this shortage is because China's halting exports to keep the lid on surging prices domestically. Does this underscore the pressing need for Australia to shore up its own sovereign capabilities, that we've put too many eggs in the one basket?
Dan Tehan: Well, what it clearly shows is that the pandemic has demonstrated that some supply chains are fragile, and as demand has picked up, in this instance for Adblue ‑ China's obviously using the Adblue that it has for its domestic markets ‑ it's shown that we need to firm‑up supply chains ourselves, and that's why we set up the modern manufacturing fund. That's why we've got that modern manufacturing strategy in place. We've got a lot of work being done on supply chains.
Critical minerals, rare earths, is another area. They're all the key ingredients which will go into the renewable energy sector as we continue to build this in this nation. All these areas we're looking very closely at, because the pandemic has shone a light that some of these supply chains are fragile.
Cathy Van Extel: China says Australia will pay a price for the decision to join the US with a diplomatic boycott of the Beijing Winter Olympics. Are you bracing for more trade strikes from China?
Dan Tehan: Well, my hope is that what we'll continue to see is the strength in the trading relationship between Australia and China. It's a strength which has lifted millions out of poverty in China and helped us -
Cathy Van Extel: So -
Dan Tehan: Maintain our standard of living that -
Cathy Van Extel: Will that be assisted by these talks that I understand are happening today with business ‑ at a business‑to‑business level, which is seen as a bit of a diplomatic thaw?
DAN TEHAN: Well, one of the things, Cathy, I said at the beginning of the year was that it would be really good, while we can't have the government‑to‑government engagement that we want, is that business could step up their engagement. So this is a good step, that we're seeing business engaging with their Chinese counterparts, and I look forward to hearing what comes out of these discussions. But, yes, this is a positive step that we will see businesses from both countries coming together for these talks.
Cathy Van Extel: Dan Tehan, thank you for your time this morning.
Dan Tehan: Pleasure, Cathy.