Australia-Hong Kong Free Trade Agreement negotiations

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Hong Kong

Thank you very much Michaela.

Can I acknowledge Greg [So].It's so good to be here with you Greg, as Secretary for Commerce and EconomicDevelopment here in Hong Kong. It's an absolute pleasure.

I'll go into more detail foreveryone in the room, but we've been talking about this for a little while. I'mso pleased that we've been able to come together, so I want to particularlyacknowledge your presence here this morning.

Our Consul-General, Michaela[Browning], it's good to see you, it's great to have you here. It's a good wayto start off a post - two-weeks in - with the launch of Free Trade Agreementnegotiations. The bad news is it can only go downhill from here. [audiencelaughs] It's great to be able to officially have this event as one of the veryfirst things you are doing in the role.

Can I thank Richard [Petty,AustCham Hong Kong Chairman] and Stephen [Ng, HK General Chamber of CommerceVice Chairman] and more broadly, the other chambers as well. Being able toconvene through the chambers is such an important milestone in terms of thecommencement of Free Trade Agreement negotiations and seems appropriate becauseat the core of these agreements is of course, our commitment to making surethat we can enable the wheels of commerce between Hong Kong and Australia tofunction. To all of you and to other distinguished guests, a very warm welcome.Good morning, and I think that today is a very important day.

When it comes to Australia'sengagement with Asia, our story has been one that's changed over time. For theexpat Aussies that are in the room, you've known what for some Australians hasonly been a recent revelation. If you look at it historically, Australia's viewon the world, we thought for so long that we were a European outpost in thewrong part of the world. It's really only been in the past couple of decadesthat the true significance and the absolute benefit that flows from Australiabeing, not only located in this part of the world but even more importantlythan our location, is our engagement with this part of the world; the fastestgrowing region in the world.

In many respects what we'vecome to realise over the years, and what many of you as expat Australiansalready know, is that our ability to integrate with Asia and the shared viewsthat we have about the importance of trade, of open markets, of being able tosee the flow of capital between countries, is fundamental to ensuring brighterand stronger economic days ahead.

So, in that vein, I'm sopleased that Greg and I over the past fifteen or so months, since I came intothe role following my predecessor Andrew Robb, have been able to move actually quitequickly towards the formal establishment of negotiations for a Free TradeAgreement.

People have said to me: "what does Australia stand to gain; HongKong already has zero tariffs when it comes to goods going into Hong Kong". And I say: well that's true - but that's to look at the old, historicrelationship because when you look at the future relationship, the real driver willbe around services.

Hong Kong knows the value ofservices, like Australia knows the value of services. Seventy-six per cent ofthe Australian economy is built on services. Twenty-two per cent of our exportsare services exports. It's the disparity between those two numbers thatrepresents the real opportunity that exists in terms of an agreement like this.

The other comment that we hear,frankly too often these days, is this notion that it's a zero-sum game. Thatwhat one country must gain, another country must lose. To believe that is tofundamentally misunderstand the value of doing trade deals.

The real benefit that flowsfrom a comprehensive modern free trade agreement that we hope to concludebetween Australia and Hong Kong, will be a true win-win outcome: a benefit forHong Kong and a benefit for Australia. Opportunities to collaborate on a wholehost of different areas; opportunities to leverage off each other's areas of expertiseand specialisation and experience and knowledge, that we can use in acollaborative way to ensure that both Hong Kong and Australia are able to gofrom strength to strength.

That's the discussions thatGreg and I have been having over the past several months. That is what is atthe core of our desire to drive a modern and comprehensive Free Trade Agreementbetween Hong Kong and Australia.

Greg and I had dinner lastnight. It came off the back of us having spent the day together in Beijingaround the Belt and Road Initiative Forum that took place. We recognise thatthis is a region laden with opportunity. We hope to be able to capture thatopportunity by the barriers that we'll be able to break-down through this FreeTrade Agreement. There're areas, for example, in relation to infrastructurewhere Australia has a deep and rich history when it comes to financing, buteven more so with respect to design and construction infrastructure. Hong Kong,of course, is on a global level, a player when it comes to the deep and broadcapital pools that are available here. It makes sense that, in time, we mightbe able to look at opportunities for collaboration.

The Belt and Road Initiativewill be a very significant initiative in our region. Very significant. HongKong's opportunity, and I know through Greg's leadership and more broadly ofthe Executive, will help to drive Hong Kong to be able to play a key role inthe BRI. Likewise, in time Australia will also be looking to play a key rolewith respect to BRI and that's part of the reason why I wanted to make surethat we have a seat at the table when it came to the BRI forum that took place onSunday.

To all of you, can I also thankyou in advance. Through the chambers, your involvement and engagement with ournegotiators, your contributions, insights, comments about what we should betrying to achieve through these negotiations, will be critical to helping shapewhat it is that we want to do. We've both said to our negotiators that we havea very high-level of ambition about this FTA. We want a comprehensive FTA. Wewant it to be ambitious. We want it to be done quickly.

Having set that small hurdle,we expect them now to be able to deliver on our expectations to negotiate agood deal. We'll put our shoulders to the wheel as well.

Ultimately all of you asrepresentatives of the chambers, as members of the chambers, as those whoactually create wealth and generate wealth across economies which ultimatelyhelps to drive employment, it'll fall upon you to do what you can to maximiseyour potential. We just hope that we'll be able to negotiate an agreement thatpulls down regulatory barriers that makes it easier for you to achieve thesuccess that we want you to achive.

With those few remarks, Greg,I'm so pleased that we've been able to come together to launch these Free TradeAgreement negotiations. I'm sure they're going to be very constructive and,ultimately, I'm sure they're going to be very fruitful for both Hong Kong andAustralia. So thank you.

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