3 February 2009
Interview - ABC Radio National, Asia-Pacific Program
SIMON CREAN: My very strong view is if we don't have Doha, we will have more of this. We will revert to protectionism and it will be done under the guise of economic nationalism, under the guise of protecting people's jobs.
So, what we've got to do is to demonstrate more forcefully that if people really want security in their jobs, it can't just come from the fiscal stimulus. It has to be multiplied by the trade flows as well.
REPORTER: Lets talk a bit more about the situation in the States and the Buy America provision. What would be the impact in practical terms in our region of that, if it was to come into being?
CREAN: Well I think that Australia's got half a billion dollars in steel exports. Korea, South Korea significantly more, and so too Japan.
If the legislation came in as the Congress passed, presumably it would stop those imports. Now, not only would that be a serious hit to all of those economies that have relied on it. What do you think it's going to do? It's going to invite retaliatory action. So this downward spiral in the belief that this thing saves jobs is actually going to cost more.
REPORTER: What about China, the other massive player on this stage? What do we do about China? A trade, signing the Doha agreement, proving the rules base system is not going to save China from the situation it's in now. What other solutions are there?
CREAN: Well importantly for China, it does understand and support the need to conclude Doha. China is a country that has huge foreign reserves, and it is the largest creditor to the United States as well as its second largest trading partner. So the statement by Wen Jiabao in Davos and the report of the conversation that President Obama had with Premier Wen over the phone that China and the US have to work more closely to overcome destructural attentions between their countries is very welcome.
China is still forecast to grow at 6.8 per cent by the IMF and the Chinese leadership have signalled that they need to have growth around eight per cent to ensure that mass unemployment doesn't occur. They had undertaken fiscal stimulus package towards the end of the last year that was designed to keep it above eight. I think the Chinese Government is clearly going to have to be reassessing just as we as a government have reassessed.
REPORTER: What are the deals that you want to secure in the region? There's the ASEAN Australia New Zealand Free Trade Agreement that still hasn't been signed. You must be getting anxious because there are rumblings coming out of Indonesia that some elements want to postpone this.
CREAN: I think you'll find in every country there'll be some elements that want to postpone. I suspect there's still some in Australia. The important thing is the Government of Indonesia is very strongly committed to its signing and that was confirmed with me as recently as Saturday by Marie Pangestu my counterpart. She's coming to Australia in the next couple of weeks for Australia/Indonesian bi-lateral talks and we've got - I think it's 27 February scheduled for the signing. [in Thailand]
[ENDS]
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