Ross Greenwood: Well, this week our Trade Minister Don Farrell met with the US Commerce Secretary Gina Raimondo. It’s a part of shoring up the relationship to ensure this framework can stick. As part of Australia’s delegation to Singapore, a total of 20 senior Australian investors and superannuation funds visited as a showcase for the opportunities that will come from this arrangement. But after he came out of the meeting with Gina Raimondo, I caught up with Don Farrell on the sidelines of this week’s summit and asked him about whether the meeting really is all about Trump-proofing this deal.
Minister for Trade, Don Farrell: We’ve now been negotiating with the United States and another 12 countries in our region about boosting trade opportunities. The agreement, the Indo-Pacific Economic Framework, goes much deeper than any American government. It’s about the relations between our country and the countries in our region. It’s about building links with the United States in our region, but more importantly, expanding our opportunities to invest and receive investments from our neighbours in Southeast Asia.
Ross Greenwood: So, can you explain to me why the Indo-Pacific Economic Framework for Prosperity, why that is better than the existing individual trade deals that Australia has with most of these partners that are within this partnership?
Minister for Trade: Look, it’s all about building on what already exists in terms of our free trade agreements. Southeast Asia is now the fastest growing economic region in the world. By the end of the decade, the Southeast Asian economy will represent the fourth largest economy in the world. We need to boost our trade with this region. We’ve been underdone in Southeast Asia. Too often we’ve flown over Southeast Asia to go to China, or Japan, or Korea. This is all about boosting our trade opportunities and our links. What we know is if we’re trading with countries, that’s improving their prosperity, our prosperity, but also bringing peace to our region.
Ross Greenwood: Does it really come home this week when you can see economic growth in Australia is barely travelling above zero per cent at the moment, that growth is slow, that we need to find other avenues, more avenues for growth in Australia?
Minister for Trade: Ross, that’s exactly right, and that’s why we’re here. The terms of trade, Australia’s terms of trade have never been as good as they are in my lifetime. The volume of trade has never been as good as it is at the moment. But we can’t rest on our laurels. We’ve got to keep building that trade opportunity. Trade equals more jobs in Australia, more investment in Australia, and greater prosperity. If we want to get that figure higher, we need to boost our trade. It’s all about trade diversification. It’s about trading with our nearest trading neighbours. We have products that these countries want, and we have to ensure that we are supplying their needs. I’ve brought with me Australian companies with $2.5 trillion under management. This is the biggest group of Australian investors ever to come to Southeast Asia. There are great opportunities here to boost our trade. We need to take advantage of them.
Ross Greenwood: So, many people have also described this as Asia Pacific’s response to the Belt and Road Initiative by China, to make certain that small and developing countries get the infrastructure, get the support over cyber security, and a range of other issues that they otherwise might seek to get from China. Again, is that the way you would portray this?
Minister for Trade: The way I would see this, Ross, is that this is an opportunity for the United States, with our support, to re-engage in the fastest growing economic area in the world. Australia is perfectly positioned to take advantage of this because of our geography. We need to make sure that America stays engaged in our region, but that we play our role in ensuring that we increase investment, and increase prosperity in our region.
Ross Greenwood: And I know you’ve had sideline discussions with the US Commerce Secretary, Gina Raimondo. Is that the way she sees it as well, that the US can also participate in various ways to help some of these emerging countries?
Minister for Trade: Ross, I’m absolutely certain that that’s the way Secretary Raimondo views this. The Americans have been keen to push this agreement. It’s taken less than two years to come to fruition. So, normally these agreements take sometimes decades, sometimes they never come to pass. But under Secretary Raimondo, she has pushed this issue. And this afternoon I’ll be signing a number of agreements that reflect the hard work that the Americans have put into this Indo-Pacific agreement.
Ross Greenwood: I mentioned cyber security earlier and that clearly is of paramount importance to Australia and many of these other developing countries right now, and there is an ongoing threat, quite clearly, but it also goes to counterterrorism financing, it also goes to money laundering. So, these are also part of the initiatives that are not strictly about trade.
Minister for Trade: No, you’re right, Ross. This is a broader structure to improve the way in which business is done in our region. We see this as a way of lifting standards right across the region so that companies who invest in Southeast Asia can be assured that the proper rules and regulations apply. And I think it’s a very positive step in our overall free trade ambitions.
Ross Greenwood: So, just explain to me where Australia fits into this quite clearly. I know in terms of our resources, in terms of our food, that’s always been important, trade, if you like, aspects for Australia. What about the intellectual property, the education that we can bring to the table here. Are there other areas in which Australia will participate apart from pure trade?
Minister for Trade: Yes. Look, it is broader than pure trade. I met with my Vietnamese counterpart today. Nearly all of the officials I meet in Vietnam either were educated, or have children currently studying in Australia, and they see opportunities for education. But it’s not just about that. It’s a whole approach. Australia has so much to offer this region. We have to be more ambitious. I said to all of the companies from Australia that we have to be more ambitious in our engagement in Southeast Asia. There’s wonderful opportunities here – we need to take full advantage of them.
Ross Greenwood: And just one other aspect of the framework is that it is difficult for any country to immediately withdraw. That is important. It requires three years notice at least, before any country will back down from this agreement, once made.
Minister for Trade: Yes. Look, we’ve ensured that if you’re going to sign up to this ambitious agreement, then you’ve got to make a future commitment to staying involved. That’s what Australia will do. I believe this agreement will have bipartisan support in Australia. But we have the same expectations of all of the other countries that are going to sign up to this agreement.
Ross Greenwood: Just a final one before I let you go. The Indian election has obviously been held over the past six weeks. Narendra Modi, with some support, is going to continue as its Prime Minister. Quite clearly, India is one of the fastest growing areas of trade for Australia. It’s a part of this agreement as well. Just explain the mood around that and the opportunities that might be there for Australia.
Minister for Trade: I think there are wonderful opportunities. I’ve met with the Indian representatives here today. They’re very confident that the progress we’ve already made, both in terms of IPEF, but more particularly in terms of our bilateral trade agreements, will continue. I’m planning to talk with my Indian trade equivalents very, very shortly once they’ve resolved all of the issues around the transition to the government. I’ll be working with them to ensure that we continue the progress that we have made on a Free Trade Agreement with India. The mood around the room is very much that the good progress that we’ve made will continue with India.
Ross Greenwood: Don Farrell, always good to chat to you from Singapore. Many thanks for your time today.
Minister for Trade: Thanks, Ross.
