Interview on Radio National Breakfast with Fran Kelly

Fran Kelly: Trade Minister Simon Birmingham joins us from Tokyo, fresh from the G20 trade talks. Minister thanks very much for joining us.

Simon Birmingham: Good morning Fran great to be with you.

Fran Kelly: Minister the G20 communique acknowledges the 'downside risks', that's a quote, of the trade tensions but there's no commitment to intervene in the trade war, no pledge to fight protectionism. Where's the resolve of the G20 to sort this out or does the rest of world just like a helpless bystander in this US-China dispute?

Simon Birmingham: Well Fran, certainly Australia and other members of the G20 here delivered clearly our concerns at the meetings in Tsukuba in Japan over the weekend about the ongoing trade tensions and the negative impact they are having on the rate of global trade and therefore, the projections for future economic growth. We did urge for those issues to be resolved and resolved in a fair and non-discriminatory way. Other countries expect it to be done in a way that's consistent with WTO rules. But it is safe to say that the two main protagonists have maintained their ground during the G20 meeting, and we can but indeed urge them to continue their discussions to try to end these trade tensions that are hurting economic growth right around the world and will have impacts on all economies. But in the meantime the rest of us also agree that we really have to step-up efforts in a whole range of other ways, regional cooperation in pursuit of new rules that will deal with areas of trade distorting practices like fishery subsidies, and make sure that we don't lose our resolve to stick to a clear, rules-based trading system that has benefited and worked for the world for many decades now.

Fran Kelly: The stakes are high and the talk can be tough. The world's going to be watching when Donald Trump does meet Xi Jinping at the G20 meeting, leaders meeting in Osaka in a few weeks. The US President says he thinks quote, China wants to make a deal. China's Commerce Ministry said last week quote, if the US willfully decides to escalate tensions we'll fight to the end. Do you see this being resolved anytime soon?

Simon Birmingham: We hope that it can be, look it is a matter between those two countries and of course we can't resolve their dispute for them. But we do urge them to engage and engage in ways that recognise that their dispute is harmful to consumers in their countries, to the economy in their countries, but also then has spillover effects for other nations as well.

Fran Kelly: And particularly us, can I talk about us? I mean Donald Trump says he'll wait until the G20 to decide whether to impose another $325 billion worth of tariffs. If that happened, virtually every Chinese product entering the US would become more expensive. US and China growth would almost certainly slow. If China's growth slows, that's going to hurt us. So have you factored in the degree of what this might mean to a hit on the Australian economy?

Simon Birmingham: Fran obviously our economic agencies are continuously looking at the modelling and scenarios as they plan for the future. We believe the Australian economy has resilience and a great degree of robustness. We, under our economic policy settings our pursuit of further tax relief for hardworking Australians, want to make sure we keep domestic settings as strong as we can. Under our trade policy settings, we're going to continue to try to expand the market access for Australian business to see the Indonesia agreement that we struck just before the election come into force, because that will expand and diversify importantly, the market opportunities for many Australian farmers and businesses in their exports. Our exports are rising at a record high, we've seen some 28 of the last 30 months now Australia has recorded a trade surplus. Our trade surplus sits at the highest level it's ever been. That's great in terms of the performance of our exporters, it's been fuelled by that expanded market access that our government has managed to negotiate over a number of years through agreements with Japan and Korea and China and the TPP and we intend to keep building that.

Fran Kelly: But what about the global headwinds that everyone keeps talking about against the backdrop of a looming US-China trade war? I mean last year KPMG put the damage to Australia of the initial $200 billion tariffs imposed by Donald Trump at $36 billion; he's now threatening a lot more $325 billion worth of tariffs. If there is no back down, will the government be kissing next year's budget surplus goodbye?

Simon Birmingham: No we don't concede that Fran, we want to make sure our policy settings keep the domestic elements of the economy strong and that's what delivering tax relief is about, and we want to make sure that we keep our external our export oriented elements strong, and that's what expanding market access is about. We believe those fundamentals across the Australian economy do remain quite resilient and of course you've heard from those economic agencies of government who have looked at it. While we see reduced interest rates as partly a buffer to what is happening in some of these global settings but we will keep working to do what we can to provide every opportunity for Australia to weather these uncertainties. Now that's why it's so critical that we don't lose our resolve when it comes to opening up markets and trade. Japan remains a very key partner for us and that's why I'm staying on today to meet with many industries, investors and others in new technologies and new areas of engagement for Australia such as hydrogen technologies and the like. It's why we're going to make sure that we work hard for a regional trade deal that brings Japan, Korea, China, India, New Zealand, ourselves and most critically at the centre of it, the 10 ASEAN nations into a potential trade pact, because they're opportunities for us in the future to make sure that our resilience is as strong as possible and that are tapping into the growing Asian markets, is as strong as possible in terms of maintaining that record level of exports that we've achieved.

Fran Kelly: You're listening to RN Breakfast, it's 17 minutes to 8. Our guest is the Federal Trade Minister Simon Birmingham who is joining us from Tokyo. He's just been sitting around the table at the G20 trade talks. Minister while you're there in Japan talking trade, the firestorm here in Australia over last week's police raids on the media shows little sign of abating. When Parliament resumes next month, we now know there will be a push from the Senate crossbench for greater protections for journalists. Would you be supporting that?

Simon Birmingham: Fran I think as the Prime Minister has said we should let due process play out here. I know that he has been speaking privately with editors and following the situation, but critically not prejudging it while the police do their work and do it in accordance with proper process and without political interference. And of course at the end of that then there's time to review any residual issues that exist and to work on them if required.

Fran Kelly: No one's talking about political interference in this process particularly, but these processes last week, two police raids on one journalist's house and on the ABC require an urgent look at the review of the laws?

Simon Birmingham: Well press freedom and media integrity is very important to Australia and to government...

Fran Kelly: And does this look like press freedom to you?

Simon Birmingham: Sorry Fran?

Fran Kelly: Does this look like press freedom to you?

Simon Birmingham: Well Fran we have a press that operates in a way that is free, that is able to publish but of course we have to make sure that when it comes to the protection of information, often highly sensitive information that exists in national security agencies or the like, that we have confidence that information can be protected there. Now that's speaking in the abstract, when it comes to how the law has worked through these cases as I say and as the Prime Minister has said, the time to review and look at those is once these matters have been sorted, not to get ahead of the process that's underway. But to ensure that we don't prejudge it but that we look in a comprehensive and clear headed way, if there are issues to deal with and then deal with them.

Fran Kelly: But late last week the Federal Police conducted of course last week they conducted those two raids, but they also abandoned an investigation into the leak in the medivac case. Now this was a leak that ASIO was absolutely furious about and revealed that in Senate Estimates. Doesn't the public have a right to be cynical when the AFP drops an investigation into a leak that aided the government's political interests but keeps up its pursuit of the media over leaks the government didn't like?

Simon Birmingham: Well look I think the AFP do an incredibly good job in Australia in a range of very difficult areas. The AFP are subject to enormous scrutiny as well, the Commissioner fronts up to Senate Estimates just as ministers and other public servants do, and he answers and addresses issues there and I've got no doubt that he will do that again. These issues will be raised and he will so far as he can without jeopardising the operation of police activities, address and respond to those queries.

Fran Kelly: Simon Birmingham, thank you very much for joining us.

Simon Birmingham: My pleasure Fran.