DAVID SPEERS: Well, the Trade Minister, Steve Ciobo, joins me now. A very good afternoon to you. Thanks for joining us.
STEVEN CIOBO: Good to be with you.
DAVID SPEERS: So should Parmesan cheese only be called Parmesan cheese if it comes from that part of Italy?
STEVEN CIOBO: Well, that's what the Europeans would like, and that's what they'll come into these negotiations asking for. Obviously, David, no surprises, the Australian dairy industry isn't very keen on that idea, but-
DAVID SPEERS: Just tell us, we produce a fair bit of Parmesan cheese in Australia?
STEVEN CIOBO: Yeah. I mean perhaps the best way to think about geographic indicators that I think most Australians are familiar with, is the split between Champagne and sparkling wine.
DAVID SPEERS: And we've accepted that, right?
STEVEN CIOBO: Yeah. A number of years ago, I couldn't actually tell you the exact date, but many years ago, the Europeans said Champagne can only come from the Champagne region, and a deal was done between Australia and the European Union at that stage, so now Champagne designates, it's what they call a geographic indicator, that comes from the Champagne region, and in Australia we have sparkling wine.
DAVID SPEERS: Very good sparkling wine.
STEVEN CIOBO: Some superb, world class sparkling wine.
DAVID SPEERS: We can't call it Champagne, so we've accepted that in Australia. Should we also accept Parmesan cheese will have to be called what? Something else. What do we call them?
STEVEN CIOBO: David, we will be negotiating all of these things as part of a-
DAVID SPEERS: I'm wondering what you, though, as the Minister, what position will you take? Will you say-
STEVEN CIOBO: I'm not going to roll over. I'm not going to roll over on geographic indicators easily. You know, we would need to be getting something very substantial in return from the European Union for us to look at geographical indicators in any meaningful way. So we've got to sit down and have this negotiation. Clearly-
DAVID SPEERS: And what are the cheese people saying to you?
STEVEN CIOBO: Well, the dairy industry, there's two things happening. So we've got the Australian dairy industry, which, of course, is very invested in a whole range of brands that they've built up, and I am deeply respectful and deeply mindful of their situation, of course. But the second thing that's happening, David, is you've got the European Union, for example, that's going into third country markets. So, you know, I'm not going to name a particular country, but they go into another country, and they'll say to that country, "Let's do a trade deal," and as a part of the trade deal that the European Union does with that country, they'll say, "You can only call it ..." to use your example, "Parmesan cheese, if it comes from the Parma region in Europe." And generally, if that other country has no industry in dairy, they'll agree to it. Now, that, of course, presents challenges for an exporting nation like Australia because-
DAVID SPEERS: We're selling to that third country.
STEVEN CIOBO: Correct, because either way, we could end up being restricted in our ability to use that name because of the deal that the European Union and that other country have done. So this is all part of the mix, they will take into account-
DAVID SPEERS: Is there an issue that if you do give ground on this, then it's prosciutto, then it's Greek yogurt, then it's, you know. Where does it end?
STEVEN CIOBO: There's nothing new about this, David. This has been around for some time. The European Union has been, what you would say, offensively aggressive, or, I should say, aggressive on offensive interests, rather than-
DAVID SPEERS: Offensively aggressive? They weren't that bad were they?
STEVEN CIOBO: I should say aggressive on offensive interests in relation to geographic indicators for some time. But Australia, also, we are aggressive in our offensive interests, and that includes, for example, enhanced and increased agricultural access into the European Union. So there's gonna be challenges on both sides of the fence. It's not all one-way traffic. But ultimately, David, you do these deals because they drive economic growth, and they drive jobs.
DAVID SPEERS: Sure. But just listening to you there, you want to take a tough stand on this, it's clear, and you're clearly saying that to the dairy industry here, that you'll fight hard on this, but you're not ruling out giving ground if it means a good deal with Europe. And let's face it, what is it? $23 trillion economy-
STEVEN CIOBO: $23 trillion.
DAVID SPEERS: 500 million people. It's our second-biggest trading. There's a lot at stake here. You're not ruling out giving ground on this.
STEVEN CIOBO: This is a massive market. Any good deal requires a bit of give and take and we’ve got to look at ultimately, where we arrive at but I can guarantee you one thing David, we will absolutely be working in lock step, hand in glove, with industry to make sure that they are part of the negotiations and discussions all the way through.
DAVID SPEERS: What would you call Parmesan cheese?
STEVEN CIOBO: You're the one making the assertion on Parmesan cheese.
DAVID SPEERS: Hard cheese? I was just wondering. Now, what the Europeans clearly want something in any trade deal as well, could we see for example cheaper BMW's? What are we gonna get out of it?
STEVEN CIOBO: Well, this is, I mean, all part of the upside-
DAVID SPEERS: How can we exploit it?
STEVEN CIOBO: -in relation to these trade deals, I mean not only do you have the wins that are gained as a consequence of increased exports but you also reduce your input costs. Now those input costs, you know, economic term, but basically saying, for consumers it could mean good become cheaper and for businesses it can mean that their inputs become cheaper as well. All of that gets fed through and you know what David? There'll be examples of where you'll have an input, an import, that's coming into Australia, which Australia is then adding value to and re-exporting. And so by reducing the tariff rate, you're actually making Australian exports more competitive again as part of that global value chain or the supply chain.
DAVID SPEERS: There's also local producers here who'll be worried about cheaper European goods hitting the market here and I heard the EU Trade Commissioner today talking, for example, about she wants better access for European motor equipment, machinery, chemicals, processed food and services. Are we going to see more, or cheaper, European chemicals on the Australian market?
STEVEN CIOBO: Only to the extent that you'd have a situation where you'd have a tariff in place. Now where there's tariffs in place, we'll look at reducing tariffs. Because, David, all tariffs are, all they are, is taxation of the population, a transfer of wealth from the general population to the government. That's what a tariff is, and-
DAVID SPEERS: It's not so much tariffs though when it comes to Australia, is it? She was referring more to government procurement rules, for example.
STEVEN CIOBO: Well, you know, that's all about value for money for Australian taxpayers. We've gotta look at all of this in the mix. The fact is David, that when you do these trade deals, you produce win-win outcomes. Now that's not to say that there are only gains, obviously in any trade deal there will be areas of the economy that are subject to more competition and more intense competition, but you know what, I actually think competition is a good thing. Australia is a very open economy. We're an economy that has thrived off the back of competition and you know, the Prime Minister and I, and indeed, the Coalition, we are very firmly of the view, that when it comes to competition, Australian businesses are among the best in the world. We can take the fight up on competition all day long, every day, and win time and time again.
DAVID SPEERS: The debate around trade has been a fascinating one the last couple of years, as you and I have discussed many times. You know, Trump won the election, promising to get out of the TPP and take a tougher line with China, and all of that. Then we saw that the TPP-11 was actually signed and sealed and that was some encouraging news. Now, however, we've got Trump and China ratcheting up trade war again. How worried are you about that?
STEVEN CIOBO: Well, there's always naysayers on trade. There's no clearer example of that, David, than the Australian Labor Party. I mean, Labor kept dragging their feet on the TPP all the way through and you know, when it really mattered, when the rubber was hitting the road at the end, Bill Shorten wanted to pack up his bat and ball and go home. He called it a vanity project of the Prime Minister's. And let’s not forget David, even on China, China-Australia Free Trade Agreement, which has seen, you know, an extraordinary surge of Australian exports to China. Labor called it a dud deal. It's just madness. There's always been the naysayers, but I believe that any fair-minded Australian can look over the last three or four years, can see the extraordinary results we've had in terms of exports, but even more important than just exports, the fact that, that growth in exports is driving economic growth here in Australia and even more importantly than that, driving jobs for Australians. That's what this is all about.
DAVID SPEERS: And have all those problems you spoke about a week or so ago, when it comes to China, the wine sales, et cetera, have they been ironed out now? Is everything running smoothly again?
STEVEN CIOBO: As far as I'm aware, having spoken with a number of businesses that are in this space and the industry more broadly, yeah, I certainly know and I mean, I'll talk about Treasury Wine Estates, ‘cause that's been the one in the headlines. From what I understand, their issues are sorted out, the containers that had extra questions asked of them about their certificates of origin, and you know, have all been approved and I understand they're moving.
DAVID SPEERS: So you're not aware of any Australian businesses having trouble selling in China right now?
STEVEN CIOBO: You know, this morning, this morning I sat down with the Australia-China Chamber of Commerce. And I asked, you know, significant business people, in many respects, the top of the apex when it comes to Australia-China relations in the business community, tell me, "Who, not the rumor. Who, here is having problem, which of you members are having problems?" And it's very fair to say, with only a couple of isolated examples, the reality is that everyone else was saying, "The relationship is strong. It's going very well." They're seeing strong growth in trade numbers, strong interest in investment and it's two-way, David. That's China to Australia as well as Australia to China.
DAVID SPEERS: What were the isolated examples?
STEVEN CIOBO: Well, they’re things that we're familiar with. We've seen, and bear in mind too that frankly, these are historical now. We saw, for example, the situation with respect to wine and that was one of the members that people spoke of, and then there was the suggestion-
DAVID SPEERS: You’re saying that that one's fixed now?
STEVEN CIOBO: Well, certainly with respect to TWE, it is and that's the one that's been in the media, but look David, I mean, two points in relation is, the first is that there are always, from time to time, irritants in any trade relationship. So when I say that we've dealt with that, that's not to say that there will never be any issues again in the future. You know what? There will be, and you know what? That happens all the time in trade relationships. So that's the first point. The second point is, that in relation to the trade relationships, we have to remain active and positive on it, and so I watch this, I'm talking to business, I engage with industry you know, on an almost daily basis through my office, to find out off them, what's happening, get a feel for the tempo of trade and respond accordingly.
DAVID SPEERS: Steve Ciobo, Trade Minister. Thanks very much for joining us-
STEVEN CIOBO: Good with you.
DAVID SPEERS: And good luck with those EU trade negotiations-
STEVEN CIOBO: Thank you.
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