Sky News, AM Agenda

  • Transcript, E&OE
Subjects: Free Trade Agreements with the United Kingdom, European Union, Indonesia and India; Joint Trade Working Group; Foreign Investment.
07 September 2016

TOM CONNELL: Welcome back to the program. Trade Minister Steve Ciobo is in Europe at the moment. He's trying to make some progress on free trade deals, both with the EU and of course, with the UK as well. That's only going to be possible post the so-called Brexit. I spoke to him earlier about initial movements in that area. Have a look.

STEVEN CIOBO: Well, we want it to be as comprehensive as possible. It's important that there's a high level of ambition both on the Australian side and on the UK side. There certainly is from the Australian side, as Australia's Trade Minister, a member of the Turnbull Government, we're very focused on achieving high quality, comprehensive, wide-ranging free trade agreements. We have a great historical bond with the UK and off the back of the conversation that I had yesterday with Secretary Liam Fox, I'm confident we'll be able to get a high quality deal with the UK in due course.

TOM CONNELL: How much point is there in going through all of this process given what you've said already that real negotiations on this can't really begin until Britain actually leaves the EU?

STEVEN CIOBO: Well, I think it's important that we have preliminary discussions around what exactly we have in mind with respect to a post-Brexit free trade agreement. In other words, what can we actually hope to achieve with the United Kingdom once the United Kingdom actually leaves the European Union. They've still got to work through a number of features about what their exit might actually look like from the European Union, but I wanted to make sure that I was able to articulate what Australia's vision was. We want a commercially meaningful, comprehensive, free trade agreement, one with basically no tariffs as much as possible and the ability to drive trade investment links between our two countries even more strongly.

TOM CONNELL: Given that fact, though, that handicap if you like, is there no real timeline at all on this at the moment?

STEVEN CIOBO: No, there is a timeline. I mean, both Secretary Fox and I indicated that we wanted to achieve a good quality agreement as soon as possible after the UK exits the European Union. These preliminary discussions, the establishment of this Joint Trade Working Group is a fundamental precursor, a step in the right direction. It reinforces that we've been able to secure Australia right at the front end, with respect to the aspirations of the United Kingdom. This is a crucial market for Australia, a big investor in Australia, and of course, also a destination for a lot of investment from Australia. So an important, valuable market for Australia and I'm really pleased that we've been able to, off the back of discussions this week, make sure Australia is right at the very front of the queue when it comes to the chance to secure a free trade agreement.

TOM CONNELL: Now, you've spoken about lending our trade expertise to the UK when it comes to thrashing out some of these deals and leaving Brexit. Could that be an issue given that we might show our hand in terms of our negotiating style, and I suppose how will it work? Are there people on secondment to the UK that then come back to Australia?

STEVEN CIOBO: Well, it's funny, Tom, because in the UK, we've had questions about whether or not Australians can negotiate with themselves on a free trade agreement, and in Australia we get questions about whether or not we're giving too much away. Look, the trade negotiators that we have are thoroughly professional, they're very good. We've had great experience in terms of negotiating three free trade agreements under the Coalition Government and a comprehensive strategic partnership with Singapore. I'm very confident that we're able to secure a high quality agreement with Australia and the UK once the UK formally exits the European Union. So I think we've got great key personnel that'll be able to really drive this agenda forward in a way that's good for both for Australia and for the UK.

TOM CONNELL: You'll also have a focus on the EU, obviously, and the EU and US deal looks all but dead for now, certainly some pretty pessimistic language from both sides. How will you be different? How are you going to manage things?

STEVEN CIOBO: I want to make sure that we engage the European Union in a way that's respectful of the fact that we've had really good conversations so far. Certainly last time I met with Cecilia Malmström, who's my counterpart within the European Union, we had really positive conversations. I'll be meeting with Cecilia again later this week, a chance to take the next step as part of the scoping study that Australia and the European Union are doing. That scoping study, I expect, should be finished by the end of the year, and I hope that in the first half of next year we might be in a position to formally commence free trade agreement negotiations. Now that's another shot in the arm for Australia's trade and investment relationship, a chance to look at really contributing, and engaging with the European Union in a way that's going to be great for driving economic growth in Australia, and driving employment opportunities for Australians.

TOM CONNELL: When your predecessor stepped down, Andrew Robb, he spoke about India as the next big cab off the rank, potentially, for Australia. Is that a key focus of yours, and are you willing to put a timeline on it, perhaps get it down this term, as Andrew Robb did with his free trade deals?

STEVEN CIOBO: My key priority in this term is to focus on what Australia can do with Indonesia. I've made it clear that the Australia-Indonesia free trade agreement is the number one priority. It's why my first trade related travel after the election was to Indonesia. It's a very big market, 250 million people, of which at least 50 million are middle class. It's a relationship that's underweight, so we can certainly do more to forge ahead between Australia and Indonesia. So that's my primary focus. On India, this is a complicated negotiation. Although the original aspiration was to knock it over in 12 months, that hasn't been possible. We're now in the process of undertaking a stocktake about where negotiations are at. So I'll keep pursuing India, but that's not our key priority. Our key priority in the short term is Indonesia.

TOM CONNELL: So what about getting Indonesia done this term, then?

STEVEN CIOBO: That's certainly the aspiration. When I went to Indonesia, I agreed with Minister Lukita, my trade counterpart from Indonesia, that we would hope to secure a high-quality, ambitious trade agreement between Australia and Indonesia, within 18 months. That's basically the second half of next year. We've got negotiators, we've got officials, and at a political level we are engaging in a way to try to make sure that we can reach that ambitious timeframe.

TOM CONNELL: I want to turn your attention to the first audit of Australian farms. It reveals that nearly 90 per cent of farmland is Australian owned, only about half of 1 per cent Chinese owned. I'm just interested in whether or not there's going to be, in the wake of this having been done now, some sort of amount that Australian-owned farms should continue. Will you set a percentage barrier, and will this feed into free trade deals?

STEVEN CIOBO: Well no. There's no plans in that respect. And Australia has an open-for-investment approach when it comes to driving investment into Australia. The fact is, Tom, that investment into Australia is good for our country. It helps to build national prosperity. It's underpinned the economic growth that Australia has enjoyed, and that economic growth is fundamental to giving Australians job opportunities. It's also fundamental to making sure over time we're in a position to pay down the mountain of debt that's been left behind, so we want to make sure that we address that debt that Labor left us, and the way that we can do that is by securing high-quality free trade agreements, that help to grow Australian exports, to drive economic growth, and to create employment opportunities in Australia.

TOM CONNELL: Because the sale of S. Kidman & Co. was blocked essentially because it was too big. Now percentage-wise, does that feed into a certain limit that Australia would find acceptable of foreign investment in farmland? You know, the Nationals would be certainly interested in Australian ownership, and where it sits in your priorities. Would dropping below 50 per cent be an issue, for example?

STEVEN CIOBO: I mean, but we're crystal-ball gazing, now. I mean, your question says we're dropping below 50 per cent. We're currently at 13 per cent of arable land, so we're talking about more than tripling of the current situation. So I don't think it's constructive, at all, frankly, to go down this path. The fact is that we retain sovereignty over Australian land. We retain a threshold that says that you cannot invest in Australia unless it's consistent with Australia's national interest. We have shown that where we think it's appropriate to do so we've said no to investment, but importantly we've also said yes to the vast bulk of investment because that investment sees capital flow into our country. It sees a creation of jobs in our country. It sees the potential of additional exports from our country to overseas markets. All of that is good news for Australia, and for Australians, and for employment.

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