• Transcript, E&OE
Subjects: Trans-Pacific Partnership; Donald Trump & Malcolm Turnbull; Infrastructure.
02 May 2017

BRIAN SULLIVAN: We're joined now at the Milken Conference by Steven Ciobo, he's a Member of Parliament for Australia for the Gold Coast, also Minister of Trade. Steven, thank you very much for joining us.

STEVEN CIOBO: Good to be with you.

BRIAN SULLIVAN: A lot to talk about because your Prime Minister is meeting with the President in New York City, in a couple of days from now. How is the relationship? TPP, which you guys love, looks like it's dead. There were some tough comments, apparently, on a phone call. How is the US-Aussie relationship?

STEVEN CIOBO: Really strong. I mean, look, this is a relationship that's endured for decades. It's a relationship, it's Australia's strongest relationship. And I have no doubt, in fact what we continue to see is a level of engagement, of cooperation, of joint strategic interests and others, which exists irrespective of who's in government in Australia and who's in government in the United States. We share, we have an alignment of values, we share a common outlook in many different respects, so it's good.

BRIAN SULLIVAN: Is the Trans-Pacific Partnership truly dead?

STEVEN CIOBO: No, I don't think the TPP is dead. Look, we were disappointed with the Trump Administration's position on the TPP but it wasn't unexpected. Donald Trump made it clear prior to the election what his view was on the TPP. My view, Australia's view is different. We think that there's a lot of value in the TPP. We can continue to have really engaging and meaningful conversations with the other 11 countries-

BRIAN SULLIVAN: The TPP is becoming a four letter word as we say in the United States. What do you think the American people most misunderstand about the TPP? Because you ask people – "I hate it". They don't know what it is, they haven't read it. But they say they hate it. What do they need to understand?

STEVEN CIOBO: Well I don't think it's about the TPP per se. I think it's more broadly the issue of trade deals and what trade deals mean for countries. Look, Australia's view is that we benefit from engaging with the world on trade. Now we've unapologetically pursued for example, in terms of trade deals, free trade agreements with China, with Korea, and with Japan – the three north Asian powerhouse economies. For Australia, getting access to those markets at a good price is fundamental but look I was really heartened with Treasury Secretary Mnuchin's comments yesterday morning. He made it clear that Donald Trump was pro-free trade, that he was pro-trade on a reciprocity basis, that's understandable, we can work with that. That's another example of where we can do deals together.

BRIAN SULLIVAN: One of the big topics here is infrastructure. Should we export the Australian infrastructure model to the United States? You guys have sold off state assets or parts of state assets, in other words you've taken say your electric grid, you sell half of it off, private capital plays a role. Your infrastructure arguably much better than, of course everybody's is much better than ours at this point here. What can we learn about infrastructure from you guys?

STEVEN CIOBO: I think part of it is in a fiscally constrained environment, when a lot of the public balance sheets are really struggling, governments are going it tough, you need to be able to mobilise private capital, the world is awash with private capital. We've been very focused on doing what we can to get the private sector in partnership with government to produce more productive infrastructure. Now one of our key initiatives is something called the Asset Recycling Scheme. Basically what that involves is the Australian Federal Government providing a 15 per cent incentive to state governments to be able to privatise assets. So another words, if they get $100 million from a sale of an asset, we'll tip in $15 million on top of that and they've then got to use that money back into new productive infrastructure. So they don't just sell off the asset and do nothing with the money, they've got to then take that money and use the proceeds into more infrastructure investments.

BRIAN SULLIVAN: Can infrastructure pay for itself? Or is it just a spend?

STEVEN CIOBO: Absolutely. No, no, no. Absolutely.

BRIAN SULLIVAN: It will be viewed as, oh we're going to spend all this. Can infrastructure fund itself?

STEVEN CIOBO: Of course it can, absolutely. And that's been Australia's experience. PPP's - Public Private Partnerships have been at the core of Australia's experience. We've done some brilliantly, some have not gone very well, but you know what, they've all served to provide a learning exercise both for the private sector and also for government. It comes down to a lot of the due diligence that of course the private operators do their forecasting, when they get those models wrong that impacts obviously in terms of the project. There are a lot of examples. Here in the United States one of the most obvious early pieces of low hanging fruit that we look at, is for example, around the privatisation of the airports. In Australia we privatised our airports years ago, we see renewed investment and it's a great quality experience. Here in the United States it's perhaps less so.

BRIAN SULLIVAN: I can see you've been to some of our airports, yes.

STEVEN CIOBO: But I mean they're ripe for privatisation.

BRIAN SULLIVAN: They're ripe for a lot of things. Steven Ciobo, Minister of Trade, Member of Parliament in the Government of Australia. Pleasure to meet you sir.


BRIAN SULLIVAN: Thanks very much. Help us out with infrastructure please.



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