Kieran Gilbert: China has added hay exports to the series of trade restrictions it has lifted in ongoing negotiations with the government. The move an encouraging sign that Australia’s delegations are making some headway in improving China relations, while also walking the diplomatic tightrope to counter its influence in the Indo-Pacific. I spoke to the Trade Minister Don Farrell, a short time ago. I started by asking him about the significance of the latest breakthrough in trade and China lifting restrictions on hay exports.
Minister for Trade, Don Farrell: Look, it’s many multiples of millions of dollars of trade that we had lost, and we have now regained. It’s one of those products that we can very quickly ramp up and there’s a lot of untapped demand for our hay in China. I’m very confident you’ll see deliveries going back into China very, very quickly. But it’s not the end of the story. As you know, we’ve still got some significant products that we haven’t yet managed to get back into China – wine, lobster, a little bit of meat. And so I’m still persevering and persisting with our colleagues in China to get those trade impediments removed, and get back to a stable trading relationship with China.
Kieran Gilbert: And on hay, you said very quickly, what sort of timeframe are we talking about? Because as I understand it, there were still a couple of steps in terms of the logistics around getting those exports back up and running.
Minister for Trade: I think they’re all eminently solvable. The important thing, was all of those companies which had previously lost their licence to sell their hay into China have now got those licences back. There may be a couple of steps along the way, but I’m very confident, and speaking with the industry, as I have been over the last couple of weeks, I’m very confident we’ll get our hay supplies back into China. It’s getting that done that will leave us with just a couple of products then to get back in. Some big ones, wine in particular, but also lobster. We want to get those products back into China as well.
Kieran Gilbert: Well, there has been a lot of speculation around wine that you mention and, in fact, that there might even be those impediments removed within the month. Is that your expectation?
Minister for Trade: Well, I don’t predict these things, Kieran, to be honest with you. I just work away. I’ve obviously worked hard to establish a good, stable, sensible, working relationship with my equivalent, Minister Wang Wentao. I’m hoping to meet him again soon in the next few weeks. I’d like to see, as I know Prime Minister Albanese does, all of these trade impediments removed and get that relationship with China back onto a stable, sensible footing into the future.
Kieran Gilbert: You said you’ll be meeting him in a few weeks. Will that be another visit by you to China?
Minister for Trade: We’re working through all of those things at the moment, Kieran, but I think every opportunity that I get to meet my Chinese counterpart is an opportunity to raise these issues, and to continue pressing the case for Australian businesses. And that’s what I intend to do whenever it is that I meet my Chinese counterpart.
Kieran Gilbert: There was a comment which was interesting a few weeks ago on the 21st of September. This was by a spokesperson for the Ministry of Commerce in China saying that they’re willing to meet Australia halfway and promote a compromise package, where they would lift the wine sanctions if Australia lifts its action on the dumping of Chinese steel. Are you willing to compromise?
Minister for Trade: Look, we see those two issues as separate issues. As you know, we’ve taken a case to the World Trade Organisation to get the tariffs lifted on wine into China. We’re very confident about that case, but as I’ve said all along, I’d prefer to sort out our differences with China through discussion and negotiation, and not arbitration. We’re going to continue with that case until such time as we’re satisfied that the Chinese Government is prepared to lift their tariffs, and we can get our wonderful Australian wine back into the hands of Chinese consumers. We don’t see any connection between those two issues, and we’ll pursue our case unless, of course, we get a satisfactory outcome for our Australian winemakers.
Kieran Gilbert: And just on there the context of all of this, it comes at a time when we see another bit of progress in the last few days with the hay exports. And then the Prime Minister due to visit China within possibly in the month or so. And then your next visit, by the sounds of it, could happen by the end of the year as well. So, on a number of different fronts, things look like they’re back on an even keel. Is that how you see it?
Minister for Trade: We’re not there yet, Kieran, but we’re well on the way. Myself, the Prime Minister, the Foreign Minister, we’ve all put a great deal of effort into stabilising this relationship. At the end of the day, our sales to China last year were $299 billion. They’re far and away our largest trading partners. We have to have a stable relationship with China. We also have to ensure that we continue to diversify our sales. I was just here this morning in Hobart visiting a salmon production fish shop – we want to diversify our trading relationship, but continue to stabilise that relationship with China.
So, it’s a twofold proposition here, Kieran. Let’s get things back to normal with China, but also ensure that we’ve got plenty of other options, plenty of other countries to sell our products into. We’ve got a strategy for improving our sales into Southeast Asia. We continue to do that, and we’ll work as hard as we can to diversify our trading relationships.
Kieran Gilbert: And on that issue, salmon is now the most valuable – apparently the most valuable seafood production sector at a value of over $1.3 billion. So, a significant industry. They’re apparently interested in that Southeast Asia focus. Is this diversification just in case the China relationship goes off the rails at some point in the future? Is that sort of your working premise?
Minister for Trade: No. I’m hopeful that once we stabilise our relationship with China, we can continue to grow that market. But our strategy is giving alternative markets to our wonderful Australian food and wine producers, and that means not just sitting on our hands, resting on our laurels. That means getting out there with boots on the ground, creating new markets for our products as you know. This year we’ve managed to implement new free trade agreements with India and the United Kingdom. They’re going very, very successfully.
In the United Kingdom, our sales are up over 200 per cent since the start of the agreement. And of course, the big one is the European Free Trade Agreement, and we’re still intent on trying to reach an agreement with the Europeans.
Kieran Gilbert: And you had a call recently, as I understand it, a teleconference with your European counterpart. Is there any sign that they’re willing to compromise and fundamentally give our agricultural producers greater access? That seems the biggest stumbling block.
Minister for Trade: You’re right there, Kieran, that is the biggest stumbling block at the moment. I’m continuing to work away with the Europeans. I’m hopeful that with a bit of goodwill on both sides that we can reach agreement. These negotiations have been five years in the making. We’re getting to the end game, as the Europeans describe it. If we don’t get an agreement in the next couple of months, then we’re unlikely to get another chance to have a negotiation for a couple of years.
I’m going into the next set of negotiations with a positive state of mind. I want to get an agreement. I know the Prime Minister wants to get an agreement, but it won’t be an agreement at any price. The Europeans have to understand that in order for us to sign a free trade agreement with the Europeans, we need greater access to their markets for our wonderful agricultural products.
Kieran Gilbert: And so, you’re optimistic. Was there anything out of that conversation with your European counterpart that helped foster that optimism?
Minister for Trade: I didn’t say I was optimistic, Kieran. I go into it with a positive frame of mind. But look, you’ve got to be like that in these negotiations. These are tough negotiations with the Europeans. They’re not going to make it easy for us so, we have to ensure that we put our best foot forward. I’m working with Murray Watt, our Agriculture Minister, very hard to make sure that they understand just how important agricultural access is to our Australian farmers.
But I do want an agreement. I know the Europeans want an agreement. We’ve just got to make sure that we can reach a point in the next few weeks, and the next couple of months that we’re able to sign an agreement that’s both good for Australia, but good for the Europeans.
Kieran Gilbert: Trade Minister Don Farrell, I appreciate your time as always. Thank you.
Minister for Trade: Thanks Kieran.
