Sky News Business, Ticky

  • Transcript, E&OE
US North Korea Summit, G7, China trade relationship, EU FTA
12 June 2018

TICKY FULLERTON: Now you might well ask with all thenationalism, the Trump tantrums and the China tensions, who would be a trademinister at present? The job in Australia falls to Minister Steven Ciobo, whojoins me live from Canberra. Minister, thank you very much for joining us there.

STEVEN CIOBO: Good to be with you Ticky.

TICKY FULLERTON: Can I ask you first about yourreaction to the Kim Jong Un and Donald Trump meeting today?

STEVEN CIOBO: Oh look, it's early days butcertainly encouraging. I think if there's, able to have momentum built off theback of this historic discussion today, that would be clearly good for thepeople of Korea, both North and South, as well as more broadly for the region.Ultimately we are all invested in a more stable, prosperous, and peacefulregion. And if we're able to achieve resolution and denuclearization off theback of this and subsequent discussions, then that would be a very big stepforward.

TICKY FULLERTON: Shouldn't we be slightly nervousabout this though? It is a bilateral discussion, we have special relationships,we've got free trade agreements with both Japan and South Korea. Is there anyrisk that this bilateral deal, when it comes to the details, might be writtenup in favor of the United States, potentially at the expense of some of ourother close trading partners?

STEVEN CIOBO: I think we're probably getting alittle ahead of ourselves, Ticky, with that question. They've only just had themeeting today, we need to see a lot more detail, there's clearly a lot morediscussion to be had, they'll be subsequent meetings. I really don't see a lotof merit to be honest with you, I'm just being very frank, in terms ofassessing what might happen with trade with Japan, and what might happen withtrade with Korea, if an agreement is struck in any particular way. Let's justsee what happens with the passage of time.

TICKY FULLERTON: But presumably as this deal... Asthis meeting was going to happen, trade departments in countries like Australiawould've been impressing upon the importance of making sure that we've got freetrade in the region maintained at all costs.

STEVEN CIOBO: We have been a consistent and strongadvocate in relation to free and liberalized trade and investment. We are anation that is dependent upon trade. It's adding in the last set of accounts,about a third of Australia's GDP growth was attributable to trade so, that's avery positive story. I, of course, have been pursuing the most ambitious tradeagenda in Australia's history. We've got trade negotiations either underway orshortly to commence with basically, all major continents with the exceptions ofAntarctica and Africa. We're pursuing deals with North America, South America,and have done deals through the TPP-11, with Canada and Mexico for example,we've got the Regional Comprehensive Economic Partnership, we've got theEuropean Union, the UK, Indonesia, Hong Kong. There's a lot going on.

TICKY FULLERTON: Right. Well I'll come to one or twoof them. But looking at the G7 meeting of course in Canada there, was it not aprofoundly depressing moment for anybody who believes in free trade?

STEVEN CIOBO: Well I certainly encourage theUnited States, and the other members of the G7 to resolve their differences assoon as possible. There's always going to be some brinkmanship andhorse-trading around discussions from time to time. Clearly President Trump hassaid repeatedly, that he doesn't believe that the United States is getting afair deal on trade. He's President of the US, that's his prerogative, and he'sgoing to pursue a course of action that he believes is going to deliver thebest outcome for the American people on trade. From Australia's perspective, wehave an FTA with the United States, we have no tariffs, no quotas in terms ofour dealings with the US for products coming in to Australia. And of course Iwas pleased together with the Prime Minister, and the Foreign Minister, that wesecured an exemption for Australia from the steel and aluminum tariffs andquotas into the United States as well. So that's a good example of reciprocityin terms of our trade and investment relationship.

TICKY FULLERTON: I was going to say, Canada has anFTA with the United States as well, that didn't seem to stop Donald Trumpchanging his mind. What makes you think that Australia having got this exemptedstatus has got it for any more than, you know, five minutes?

STEVEN CIOBO: Well, we have the exemption, that'sthe agreement that's been struck between the Prime Minister and the President.It also puts Australia in a different category to Canada and Mexico as youyourself stated. I also note though, Ticky that President Trump has on a numberof occasions now, railed against Canada's very significant tariffs on dairyimports into Canada. And as I said, Australia doesn't have those sorts oftariff barriers in our relationship with the United States. So, in manyrespects, what we have is a reciprocal trade relationship, no tariffs, noquotas. And that works best for both countries. I mean there are some isolatedexamples of quotas etc in terms of our bilateral, but it tends to be in termsof numbers quite small and quite particular, in terms of where those apply.

TICKY FULLERTON: So there's no risk that a shift indynamics as a result of for example, the meeting today, the agreement today inSingapore, could have impacts on countries and indeed lead to the US puttingpressure on us, on trade. You can't see those sort of scenarios playing out?

STEVEN CIOBO: Well it's a constantly moving feastwhen it comes to global trade. We are seeing more developments in trade than wehave seen for quite some time, so a big part of my role is, of course, toremain abreast of developments and change as they take place. But Australia isat the forefront in terms of our advocacy about the benefits of liberalizedtrade and investment. And as I said, I'm pursuing the most ambitious tradeagenda in Australia's history. There is a reason why I'm bringing so manydifferent countries to the table and having discussions and negotiations withthem. It's all about making sure we can diversify as much as possible, all ofour trade and investment interests, because diversification generally meansless risk, it's a risk mitigant, it also means that we're in a strongerposition to capitalize on opportunities as and when they present themselves.

TICKY FULLERTON: Well despite your efforts to try andspread risk, obviously we are very dependent on China. You've talked a lot, Iknow about the tensions with China at the moment, China and Australia. Yourshadow Jason Clare has been on Sky News talking about wine in particular wineand beef, but saying it was now taking up to two months for Australian productsto leave China's docks and reach restaurants and stores. And that's new, itdidn't use to be like that. He said Australian wine used to go through in twoweeks. Surely something is happening here at the moment.

STEVEN CIOBO: You know what, only the AustralianLabor Party would look at a trade that's gone from $211 million worth ofexports a year, to over a billion dollars worth of exports a year and complainabout it. That's what the Australian Labor Party does. They just whinge, andthey're negative, and they complain. So let's deal with facts. As I said we'vegone from $211 million worth of exports, Ticky, to now more than a billiondollars worth of exports a year. Now there have been some issues that wereraised with me. TWE is one of them, and guess what, I've raised them with myChinese counterparts. And we basically resolved those issues, so that they nowhave product that's moving again, and isn't stranded, and you know what, China hasthe right under the FTA to seek the veracity etc of the paperwork. They'veexercised that on this occasion and we're seeing, now, the resumption of normalexports and so that's been the case so far.

TICKY FULLERTON: Well, you make the good point aboutwine exports for example, expanding to China, but I would have thought that ifthere are concerns about the way China can slow things down and beef's anotherarea, at a time when other competitors, global competitors are also gettingaccess to China. This would actually be more serious not less serious thatwe've now got a bigger and bigger industry that's dependent upon this. I meanis for example, Australia Week in China on track, is it going to go ahead?

STEVEN CIOBO: Well we'll assess that in due course,I'm leading a very large delegation of Australian businesses to the CIIE, theChina International Import Expo, which is part of President Xi's vision aboutcontinuing to open up China for trade and for investment. The CIIE is hisvision, and I will make sure Australia's there with a strong presence, andwe'll be putting our best foot forward. But you know what Ticky, the factremains that we have seen a massive expansion in Australia's trade andinvestment with China, especially since we put in place the China AustraliaFree Trade Agreement. And let's never forget, that it was the Australian LaborParty, who effectively condoned one of the most disgraceful anti-Chinacampaigns that the trade union movement has ever run in this country. Theyspent tens of millions of dollars, effectively sledging China and Chineseworkers on TV stations and radio stations across the country. So you know what,I'm not going to be lectured by the Australian Labor Party, when they actuallyalmost derailed the entire process, and now he wants to chip in two cents worthon wine.

TICKY FULLERTON: Business I think is growing, I meanthere is commentary around that there are more and more businesses now who arejust a little bit concerned about whether enough is being done. Perhaps in thebackground, in the area of nuance, rather than getting our Prime Minister to goup to China or something like that. That enough is being done in the backgroundto smooth things over so that business can continue on its merry way with Chinaexports and investment.

STEVEN CIOBO: Well Ticky you're asking me to catchsmoke frankly. You're asking me to catch smoke. Let's deal with facts. And hereare the facts. Trade has grown substantially. Investment has grownsubstantially. I just concluded my 13th official visit to China, over the pastcouple of years. I'm going to China again in November for their CIIE, theirChina International Import Expo. Where there have been isolated examples ofirritants in relation to our trade relationship, I've raised that with China,and those irritants have been resolved. So, pretty much on every measure, whenyou actually look at the facts, the story is a positive one. And I'm going toput that up against anecdotal reports, and as I said, what you're effectivelyinviting me to do which is to catch smoke, happy to go up against that all daylong, every day, and just report back to you the facts of the trade as theycurrently are.

TICKY FULLERTON: Fair enough. Can I just, before Ileave you, can I ask you just about Europe and Brexit. Obviously veryimportant, the EU withdrawal bill going through, well Theresa May would like itto go through tonight no doubt our time. How do you see the British FTAprogressing and indeed, we've got Cecilia Malmström, the EU trade commissionercoming over next week. Do you see them as two very different negotiations orare they neck and neck? Do you think one's going to come through ahead?

STEVEN CIOBO: Well no they're two entirelydifferent negotiations, and they'll operate in parallel. Let's also be clearthat the discussions and negotiations with the EU are far more mature andadvanced, than they are with the UK. In fact, we're about to commencenegotiations with the EU, we are not yet commencing negotiations with the UKand in fact won't do so until after April next year.

TICKY FULLERTON: Yes, you're not allowed to.

STEVEN CIOBO: Correct, so our discussions with theEU have been very positive, we've invested a lot of time and effort into nowthe commencement of these negotiations after the conclusion of the feasibilitystudy that we did. EU trade commissioner Cecilia Malmström, she and I have anexcellent working relationship. She's here next week, and I'm looking forwardto kicking off what should be very good negotiations, and I hope a highquality, comprehensive FTA in due course.

TICKY FULLERTON: That's great. I hope I'll be able tocatch up with her as well, but Trade Minister, thank you very much for yourtime, appreciate it.

STEVEN CIOBO: Good to speak with you. Thanks Ticky.

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