The field evidence pointing to the great job-creating potential of our historic trade deal with China is conveniently ignored by those pretending it somehow poses a threat to Australian workers. The opportunities in China through ecommerce alone for business expansion and job creation look limited only by the imagination.
Savvy Australian exporters are using the market reach of major online platforms such as JD.com, Taobao, Tmall and Alibaba to access more than 300 million Chinese consumers who shop online, about 40 per cent of whom have purchased from Australia. These numbers are growing exponentially, given China’s rapidly rising middle class in a population of 1.35 billion.
As well as businesses already trading online are those that are developing innovative sales and distribution models in readiness to capitalise on the concessions afforded to us through the China- Australia free-trade agreement.
Under the agreement, our online exporters will benefit enormously from the elimination of, in many instances, prohibitive tariffs on 95 per cent of goods we send to China. This will make us ultracompetitive because Chinese shoppers place a premium on Australian goods because of their reputation for quality.
This includes our wine, seafood, beef, confectionery, dairy products, health supplements, infant food, cosmetics, leather goods, shoes, clothing — the list goes on. They will become more affordable relative to our competitors and this will help drive increased sales and create new jobs. Natural health company Blackmores is already experiencing remarkable growth in China with sales going from $2 million to $75m within a year. It recently secured approval to sell its products online and also has won the endorsement of Chinese tennis star Li Na. The company expects the surge to continue when tariffs of up to 35 per cent are eliminated on its products. Blackmores has just employed an extra 100 people on Sydney’s north shore to help meet the anticipated growth.
During a business mission I led to China last month, Blackmores formalised a strategic partnership with JD.com that could support a further tenfold increase in its sales to China. On the same mission Sanger Australia also signed a memorandum of understanding with JD.com to provide the first Australian chilled, retail-ready cuts of beef to Chinese consumers online. Meat and Livestock Australia estimates ChAFTA will add $830m each year to the red meat industry by 2024. Again, this will translate into thousands of new jobs for Australians.
Fresh Select, which supplies produce to the Australian supermarket trade, is developing a new model for sending high-quality food and beverages directly from growers and producers to Chinese families. Produce would arrive from Australia direct into a massive warehouse in Shenzhen. Customers would order online and be given an electronic access code.
Their order would be filled robotically and couriered directly to their apartment block, to be put in lockers for secure access using the code. The system provides an assurance of true Aussie provenance to purity-conscious Chinese consumers, cuts out middlemen who soak up margins, and delivers higher prices at the farm gate. What excited me about this story was that a new Australian business was being created today, in the expectation the umbrella of the FTA will be open for business tomorrow.
One of our aims is to see increasing numbers of small and medium-sized Australian businesses take advantage of the export opportunities afforded by our landmark trade deals with China, South Korea and Japan. Online platforms in these countries provide those businesses with virtual shopfronts to hundreds of millions of customers at relatively low cost.
In terms of broader anticipated job growth stemming from ChAFTA, the dairy industry estimates 600 to 700 new jobs will be created in its first year of operation in this sector alone. The Financial Services Council believes the agreement has the potential to add $4.2 billion to gross domestic product and create nearly 10,000 new jobs in areas such as banking, insurance and funds management by 2030.
The militant unions raging against the trade deal pretend none of this exists and continue pushing their racially charged misinformation in a crazy campaign against jobs and growth. Bill Shorten, in refusing to rule out opposing the deal, is not only increasingly alienated from the sensible mainstream but looks beholden to the Construction Forestry Mining and Energy Union.
He persists in making the utterly false assertion that under the Investment Facilitation Arrangement linked to the trade deal Chinese companies will be able to bring in foreign workers on infrastructure projects worth more than $150m without having to first offer jobs to Australian workers. This line has been debunked. Asked about this during a joint standing committee on treaties hearing, a respected senior immigration official said: “You absolutely, mandatorily, have to test the labour market.” That is, provide evidence of significant local recruiting efforts, including advertising, in the prior six months. Furthermore, the guidelines state in black and white that an application to bring in foreign workers will succeed only if Immigration “has been satisfied that Australians have been provided first opportunity for jobs”. End of story.
The irony is that these safeguards are more stringent than Labor’s previous Enterprise Migration Agreement on which the IFA is modelled. This required proponents only to conduct an analysis of the local labour market. Under the arrangement associated with the China FTA both labour-market analysis and labour- market testing — that is, advertising locally for workers — are mandatory requirements.
Labor, of course, sees political advantage in trying to legitimise a $12m union campaign that is more anti-government than anti-trade; the CFMEU has admitted as much. The problem for Shorten is the public has seen through it.
Let’s not forget the unions made the West Australian Canning by-election a referendum on ChAFTA, throwing considerable resources at promoting a no vote. This was overwhelmingly rejected in a state that understands the importance of a trade deal with China in aiding the diversification of our economy in this critical post-mining boom period. The fact is the China trade deal is all about job creation and empowering our businesses to seize the future; claims to the contrary have about as much credibility as the CFMEU itself.
- Trade Minister's Office: (02) 6277 7420
- DFAT Media Liaison: (02) 6261 1555