Interview on 5AA, Breakfast with David Penberthy and Will Goodings

David Penberthy: Yesterday, at about 7 o’clock, we were aiming to catch up with South Australian Senator, Simon Birmingham. We did get in touch with him over the course of the day and he joins us now on 5AA Breakfast. Minister, good morning to you.

Simon Birmingham: Good mornings guys. Great to be with you.

Will Goodings: Thanks for joining us, Senator. What is the latest on the relationship with China? Because it looks like it’s sort of almost gone beyond the point where you can pick up the phone and talk to your trade counterpart, sort of one on one about this. Is it- how do you retrieve this situation?

Simon Birmingham: It is going to take a little bit of time, calm and patience, as well as consistency and I think that is the key thing here. Australia hasn’t changed any of our outlooks, approaches or positions. We remain a country that, of course, is true to our values and protects our national interests and our security interests. But also a country that seeks to engage constructively with the rest of the world, and that includes seeking that constructive relationship with China. We clearly are very disappointed and aggrieved at some of the actions China’s taken in recent time. But we remain willing to have dialogue, to work through these sorts of issues and I think that’s the mature approach that Australians would expect us to, to stand firm on our values and in our interests, but also to be willing to engage with the world. Now, obviously we can’t make anybody come to the table for those sorts of discussions and that’s why a bit of patience is required too.

Will Goodings: But can we do it legally? I mean, we’ve got 800 million of the 1.4 billion exposure of the Australian wine industry is here in South Australia. Is it possible to just take China immediately to the World Trade Organization and say, seek a ruling saying there’s no evidence of dumping whatsoever, and China has to drop these tariffs forthwith?

Simon Birmingham: The World Trade Organization offers some pathway for us to try to resolve these issues but it’s not a quick pathway. So, yes, ultimately, the WTO is a means that we can appeal and certainly Australia has long defended the need for an international rules-based approach to trade. It’s why we’ve been a member of the WTO and its predecessor body since 1948. It’s why we’ve encouraged others, including great powers like the US, or China, to join and to respect those rules, even when they’ve threatened them. Because we know, for mid-sized economies like ours, let alone smaller countries around the world, it's important to have those rules. And then when you think the rules have been broken, to call it out and to call in the umpire, and certainly that is the type of approach that we'll take. But unfortunately, it's not a quick process. So, again, I would emphasise that the best pathway is to have the discussion and the dialogue that can resolve these things. Even with Canada, we recently had a WTO dispute that we started. It also related to the wine trade and we got underway through that dispute process. But before we got to the final point of the independent umpire calling out a result on it, we managed to resolve it behind the scenes and to work things through. And so my message to China, even on those matters, is we may call in that independent umpire but we will still be willing to talk.

David Penberthy: Is the goal of Australian international relations and trade policy now to diversify our export markets and reduce our reliance on China? Or is it to try and return things to how they were before this this blow up in 2020?

Simon Birmingham: I've been saying for some time that Australian businesses needed to recognise that the risk of trade with China has clearly changed. That the unpredictable regulatory decisions, the disruptions that were occurring had changed the risk profile and that meant that businesses in their commercial decisions, their business planning decisions needed to think about how they dealt with that risk, including the opportunities in other markets. And it's why our government hasn't just done a trade deal with China in the last seven years. We've done trade deals with Japan, Korea, Canada, Mexico, Vietnam, Indonesia; we're pursuing them with the EU and the UK. And this is all about giving Australian businesses the maximum choice. Now, obviously, recent events and the extent of China's action in areas like the wine industry make it even more crucial for businesses to seek those opportunities. And we'll be doing everything we can through our Austrade network, our diplomatic networks to try to encourage that. And I am heartened in the last couple of days to see some of the commentary around the world, encouraging people to drink more Aussie wine, and we want to make sure we keep that sort of momentum going.

Will Goodings: To that end, Birmo, would you- I'm not sure if you've seen this proposal that's come out overnight out of London. A group of Conservative MPs has prepared a discussion paper saying that the G7, Group of Seven Nations, which are all liberal democracies with open economies, should be broadened out to become the D-10, which would stand for Democratic 10 to include India, South Korea and Australia as well. Is that an idea that has merit?

Simon Birmingham: It kind of has a practical application almost already, in that the G7 have to some extent been consistently inviting some extras to the table. Scott Morrison attended the last G7 meeting that occurred in France, was due to attend this year’s if it had been held in the US, and I think has been invited to next year’s in the UK. So, I think there is a lot to be said for likeminded countries to work together. It's one of the reasons as well as to why we are pursuing this candidacy of Mathias Cormann for Secretary-General of the OECD. The OECD brings together around 30 of liberal democracies and market economies who are likeminded and have a formal role in terms of setting and developing policies, analysing processes, and really can help to drive cooperation in a range of ways.

David Penberthy: Minister Simon Birmingham, appreciate your time.

Simon Birmingham: Thanks, guys. My pleasure.