Sky News Interview

  • Transcript, E&OE
Subjects: CPTPP.
24 January 2018

Kieran Gilbert: Let's go live to Davos and joining us now it the Trade Minister Steve Ciobo. Mr Ciobo thanks very much for your time. Of course, the US not is part of this, eleven nations are committing to it. Can you tell our viewers how much of the original deal stacks up in this revived arrangement that you've agreed to overnight?

Steven Ciobo: Well Kieran, this is a great deal, it's a great deal for Australia. It's going to mean that Australian exporters have better access than they have ever had to a very large proportion of the global economy. We're talking about the eleven countries involved representing something like $13.7 trillion worth of economic activity and roughly a quarter of our exports went to these countries. So, putting Australia on an even better footing, a brand new agreement with Canada, with Mexico, within the framework of the TPP-11 is going to mean that we've got a high-quality of deal with better access for goods, better access for services, better access for investment. It's going to drive economic growth and help create jobs in Australia.

Kieran Gilbert: A number of provisions from the original agreement have been suspended. What provisions are they and are they significant?

Steven Ciobo: Well, the suspensions, Kieran, were largely suspensions that the United States had insisted upon. They were provisions that obviously reflected US offensive interests and as a consequence, given the United States decision to withdraw from the Trans-Pacific Partnership, the remaining eleven us thought, well, these don't need to be in there, they are in there for the Americans only. What we have though is an exceptionally good quality deal that's going to be great for Australian exporters which means more economic growth which means more jobs for Australians.

Kieran Gilbert: We know Australia along with Japan have been the strong drivers of this, with the Abe Government in Tokyo, can you explain to us what negotiations, what was happening behind the scenes during the final stages of this? Particularly, given the fact that the Trudeau Government of Canada had balked, and we saw that quite notably at APEC last year.

Steven Ciobo: Well, Kieran, we, of course, got very close at APEC last year. Your viewers would be familiar and remember that we thought we had a deal, but then at the last minute unfortunately, Canada wasn't able to sign up to it. We have now concluded the deal. One of the principal sticking points for Canada was the issue, and it all gets a little technical, but about cultural exceptions, given that Canada has a large minority population that speaks French. They've been more reasonable, we've all found more common ground and as a consequence, we've been able to do this deal. So this is a good deal. It's going to mean, let's give you one example, Australia has new beef access with more rapid reductions in tariffs into Japan, that's going to put the Australian beef industry at a substantial advantage over for example, the United States' beef industry, great news for Australia. We've got new sugar and wheat quotas into a number of different countries and as I said, brand new agreements with Mexico and Canada as a consequence of this deal.

Kieran Gilbert: In relation to the future of this arrangement as well, eleven nations signed up. Is there scope as the original arrangement was designed to take in other countries, a country that comes into mind, well there are a few of them, first of all the UK in a post-Brexit world, they'll be looking for trade arrangements, you would have thought, would the UK be a possible signatory in the future?

Steven Ciobo: Well you're right Kieran, we've some process still to go through. Although we have agreement on officials' level in Japan yesterday, what we now need to do is move towards a signing. Ministers are looking at convening in early March in Chile to sign the TPP. Then we will of course, go through the ratification process in through the Australian Parliament. They'll be an inquiry and people will have the chance to make comments and all this type of material will take place. But you are right, there is opportunity for other countries to join and we know there is a lot of interest to joining the TPP, Kieran. Other countries want to join because this is such a good deal for those members of the TPP, other countries like the UK, who aren't even in the Pacific, would like to look at joining down the track. So it just is in many respects, a sign of confidence that this is a good deal for those who are inside.

Kieran Gilbert: Originally, it was seen as the economic arm of the Obama pivot to Asia and was isolating China, what's your view of it now in a post-US world, in terms of the TPP? Would China be a possible signatory as well?

Steven Ciobo: Well, I'm not going to guess as to which other countries might be looking at whetherthey join or not. There's lots of speculation that floats around. What the implications of this are though Kieran, is that Australia is part of eleven countries a regional block, representing some $13.7 trillion worth of economic activity. We have our producers; we have our exporters, our Australian businesses on the inside of this brilliant trade deal, so this is going put Australia in a stronger position as you know Kieran, the Turnbull Government is absolutely committed to opening up more markets for Aussie exporters, we've seen export growth really underpin economic activity here in Australia, and the consequence of that Kieran, is that we are seeing increased employment opportunities for Australians, because when you cut through everything, the reason these trade deals matter is because it means more economic growth and more jobs and that's great news for Australian families, that's great news for Australian businesses big and small, and that's the reason why, at the request of the Prime Minister, I've been pursuing this.

Kieran Gilbert: Can you put any specific numbers on this boost that you've talked about repeatedly, is there any specific modelling done as to just how much of an export boost and growth boost this might provide?

Steven Ciobo: Well Kieran, we have seen modelling in the past that has been completed in relation to the TPP-12 when it originally included the United States. But I think it is important to recognise as well that frankly a lot of the modelling around trade agreements isn't worth much. And I don't say that lightly, I say it seriously, the reason being is because most of the modelling around trade deals cannot simply capture what's called the 'second round' effects of these trade deals, in other words, it doesn't actually capture a lot of activity that takes place as a result of boosting exports and people knowing that they can get preferential treatment. So, you know, this is as I said, a very good deal, huge proportion of the global economy, a quarter of Australian exports concerning the countries involved, two new free trade agreements with Mexico and Canada, and importantly we have other countries that aren't currently part of this deal, already saying 'we want to be part of this deal in the future'.

Kieran Gilbert: While you've had that development, and that progress happen while you've been in Davos, other developments over the past 24 hours have seen President Trump sign executive orders on tariffs for solar panels and washing machines into the US. So as you're pursuing free trade, he's pursuing protectionism. Now in Davos where you are, we've heard from Nobel laureate Joseph Stiglitz, who has said this is bad for the global environment. The BlackRock Inc Vice Chairman Philipp Hildebrand who says protectionism is now the biggest risk to the global recovery, which we've seen in full light this week with the revised growth forecast of the IMF.

Steven Ciobo: You're right Kieran, protectionism doesn't work, it doesn't guarantee prosperity, it doesn't make people stronger in the future, all protectionism does, all erecting tariff walls does is make people poorer. It subdues economic activity, and it leads to job losses. We know that as a statement of fact – it's not even a controversial statement to make. So as a consequence, Australia continues to pursue liberalised trade investment, but trade investment that's good for Australia, Kieran, it's not a philosophical, blind ideology that I pursue, this is about getting good deals that are good for Australia, that's what drives me, in terms of all trade negotiations and discussions that I am having.

Kieran Gilbert: Does it worry that you are seeing these developments out of the Trump administration not only out of the TPP, but now erecting those trade barriers that you warn about?

Steven Ciobo: Well Kieran, I am more worried to be honest, about those that pedal an anti-trade rhetoric in Australia. We've seen for example, the Labor Party and Bill Shorten consistently say that they didn't want to be a part of the TPP, they thought it was dead, they were urging the Government to walk away from this deal. I mean, if Bill Shorten and the Labor Party had their way, we wouldn't be a part of the TPP-11, they wouldn't have been able to secure the agreement with China, they wouldn't have been able to secure the agreement with Japan, and this is an Opposition party, a Labor Party, that frankly get all of the big calls on trade wrong, and this, today, just reinforces why we don't listen to Bill Shorten and the Labor Party because they can't do trade, they can't open markets for Australia, because they are beholden to protecting the interests of the union movement, they're their masters, and they only ever represent the views of the union movement, and not the views of Australian farmers, small businesses, big businesses, who are looking at getting out into the global economy, and opening up new markets.

Kieran Gilbert: Mr Ciobo, while you will welcome this success though, in terms of trade liberalisation, back to Trump though, he said this morning in the White House, there won't be a trade war; they'll only be stock increases for companies in the US. But why is he so certain there won't be a trade war? You lift barriers to nations like China, potentially others like South Korea in the region, how does he expect that there won't be some kind of retaliation?

Steven Ciobo: Well, speaking frankly Kieran, there is a risk when you see a country undertake unilateral action to increase tariffs. But there'll be a consequence to that and that consequence could be that other countries make similar decisions. It isn't a good situation. I'm doing everything I can do to play an active role in the global community to make sure that we continue to pursue, through the World Trade Organisation, liberalised trade. We have one of the most, if not the most active trade agenda that Australia has ever pursued. I mean, I currently am having negotiations with, or pursuing Free Trade Agreements with Indonesia, with Hong Kong, with India, with the UK, in time, with the European Union, we've just done the TPP, we recently concluded a Free Trade Agreement of course with Peru. So, we have a massive trade agenda that's about opening markets for Australian businesses, and that's going to continue the advocacy that I've been making about why this is good for Australia and Australian jobs.

Kieran Gilbert: Trade Minister Steven Ciobo joining us from Davos, Switzerland. Appreciate your time, thanks.

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