27 February 2009, Hua Hin, Thailand
Doorstop Interview, Hua Hin, Thailand
Subject: ASEAN FTA
JOURNALIST: Can you tell us briefly about the agreement?
SIMON CREAN: The agreement is a significant agreement for the region. It’s the most comprehensive FTA that ASEAN has ever signed. It’s the largest FTA that Australia and New Zealand have ever signed. In terms of two-way trade with all of the countries in, it is $100 billion in two-way trade; Australia and ASEAN, $80 billion.
Clearly with the market access openings that this agreement presents, there is the capacity to build the trade flows significantly and the economic opportunities for all countries. The level of ambition in this agreement shouldn’t be underestimated. Not only is it a comprehensive agreement that covers goods, services and investment. It’s also an agreement that understands that countries at different stages of development need longer times to make the adjustment and that’s reflected in the agreement. But so too is the fact that countries that are developing also have to have their capacity to develop enhanced. Therefore, it’s an agreement that very much links the aid-for-trade equation.
So I congratulate all of those who have been involved in the detailed negotiations. You could see the weight of the document, the size of it, as to how detailed and complex it is. This has been a massive effort and I’m delighted with the result and it demonstrates that with the right political will even the most complex of agreements can be struck.
JOURNALIST: So, actually it wasn’t that long ago that New Zealand and Australia were described within ASEAN as the white trash of the South-Pacific. We seemed to have moved on since then – what does this say about the progress in relations.
CREAN: I think it shows two things. The maturing of the relationships through much better understandings and much better dialogue. But I think fundamentally, it reflects the interdependency that all economies are to each other. The growth that has occurred within Asia, the market opportunities that those markets have had in terms of selling into the Australian and New Zealand markets. This agreement is a reflection of that interdependency and the maturity and the political will to overcome past prejudices is a reflection of what can happen when you see the common objective.
JOURNALIST: There’s really no such thing as a free trade agreement or area. There are always limitations, always restrictions and as you point out it’s a very lengthy document I guess for that exact reason. So, if I’m a farmer in Young or an Australian food exporter how do I find my way through this agreement?
CREAN: Well it is a complex agreement and because there are ten countries with two others in it, there’s an obvious reason for that. So far as the farmer in Young is concerned, this is now the role of Austrade to identify the matrix of opportunity for Australian exporters to try and develop a cohesive strategy going forward for us to be proactive in identifying the market opportunities that present themselves. The weight of it, the size of it, is a reflection of the complex technical detail but the principles are very simple. Market access will be improved and by the conclusion of the agreement some 96 per cent of tariff lines will have been eliminated. This is a significant signal, a significant statement of increased opportunity for Australians who want to export. So I urge those Australian producers to take advantage of the opportunities presented. Get in touch with Austrade and develop your strategy to take that advantage.
JOURNALIST: I want to pick up on your capacity building. Given the capacity building aspect of the document and the agreement which is more aid than trade, how exactly does that work?
CREAN: It works by being responsive to what the countries themselves have identified as their need for capacity building. A couple of examples that have come to the fore have really related to improvements so far as the dairy industry is concerned in a number of the participating ASEAN countries and Australia, as is New Zealand, in a unique and powerful position to not just offer the technical assistance but to have aid programs that can facilitate it. That’s a good thing because it’s a global approach in the region, if you like, in terms of the dairy industry and its opportunities.
I think also the opportunity
to build their capacity to meet the quarantine standards that Australia
and New Zealand demand; giving them the technical expertise, equipping
them with the know-how to meet those requirements. There of course
are issues that go to infrastructure and skills formation. This
is the capacity building - soft as well as hard infrastructure – and
we want the program to be responsive to their needs but their needs
based on identifying opportunities to take advantage of the market liberalisation.
JOURNALIST: Do you see it as problematic that Australia, a country with a reasonable human rights record, is entering into a free trade agreement with Myanmar which manifestly has an awful human rights record?
CREAN: Well, we haven’t had bilateral discussions with Myanmar but we have recognised that Myanmar is part of ASEAN and we’ve negotiated the agreement as a total framework agreement. We haven’t proceeded down the path of further advancing it on bilateral grounds.
JOURNALIST: So what’s next for Australia then, once this is over?
MINISTER: Well, on two fronts. One is concluding the Doha Round because that is the big global opportunity and it is so fundamental to the solution to the global financial crisis. Trade is a multiplier and so, to the extent to which we can continue liberalising markets, it’s going to provide important stimulus to an ailing global economy. Within the region though, I think that what this agreement does - and this is the point made in an earlier question - it’s not a perfect free trade agreement. There is still room for movement. There is still room for further progress. What we want to do is to take this new platform that’s presented by the ASEAN free trade agreement and use it as the basis for advancing our bilateral arrangements. Whilst I’ve been here, we’ve already had discussions with countries such as Indonesia and Malaysia and Cambodia and Thailand itself, for example, as to how we can advance the bilateral agreements off the back of it.
[ENDS]
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