Press conference: Launch of Peru-Australia Free Trade Agreement

STEVEN CIOBO: Good morning and it's great to be here with you all. Can I particularly welcome Peru's Minister for Trade and Tourism, Minister Ferreyros. It's terrific that you're here. We've had the opportunity to see each other many times over the past 12 months or so but in particular we saw each other on the weekend in Hanoi, around APEC meeting and now the Minister's visit here in Australia. The reason we've come together this morning is to formally launch negotiations for a comprehensive, high-quality free trade agreement between Australia and Peru. We propose to put in place what would be another important stepping stone as Australia continues its engagement strategy with the world. The Coalition Government here is very focused on creating opportunities for our exporters to be able to find new markets, as well as, of course, for the opportunity for Australian services providers, for our tourism providers and others to be able to engage with the world. There is no doubt that engaging through trade provides stimulation to Australia's economic growth and a stronger economy means more job opportunities. What I'm particularly excited about with Peru is Peru has been one of the world's fastest growing economies, which averaged 5.9 per cent growth. One of the highest in Latin America, indeed one of the fastest growth rates in the world. And our discussions and the desire to be able to put in place a free trade agreement that we can negotiate is a recognition of the huge potential that exists between Australia and Peru. Many of our competitor nations like the United States, Canada and the European Union already have a free trade agreement with Peru. So from Australia's perspective this is an important step forward in putting in place a comprehensive deal that we know in time will provide a win-win outcome. A win for Australian exporters, as well as a win for Peru in terms of their opportunities with Australia. So by way of introductory comments, I'll confine my remarks to there and invite Minister Ferreyros to make some remarks.

EDUARDO FERREYROS: Thank you. Thank you. Good morning everybody. Thank you Minister Ciobo. It's a pleasure for me to be here today in Australia and have this meeting with Minister Ciobo in which we are launching free trade agreement negotiation. We want to have a very comprehensive, ambitious agreement. I met Minister Ciobo in the meeting, in the APEC meeting in November in Lima and we start to talk about this possibility. Then since then we've had several meetings in different cities in the world. The last one in Hanoi in another APEC meeting and our technical teams have been talking about the possibility to have this agreement started.

So I am very happy to be here today launching, with Mr. Ciobo, this agreement that is going to be very comprehensive. We are ready to have an agreement that is going to be for the benefit for both our countries, and our people obviously. This agreement will generate jobs in both sides and that's what we are doing for the last 15, 20 years in Peru. We have already 19 free trade agreements with 53 countries. Minister Ciobo was right, our Peruvian economy has been growing steadily in an average around 5.9 per cent in the last 10 years. Part of that growth has been because we are having an economy integrated into the world and we have bilateral agreements. We believe trade investment is one of the engines that move the economy. I am very happy to be here today with my colleague launching these negotiations that are going to be for the benefit of both our countries. Thank you, Minister.

STEVEN CIOBO: Very good. Happy to take any questions.

JOURNALIST: Gentlemen, how long do you expect it to take to conclude the negotiations and formalise the deal?

STEVEN CIOBO: We want to make sure that we're able to negotiate a good-quality agreement. We don't want to sacrifice a quality agreement for speed, but that notwithstanding, Australia and Peru have had experience negotiating together, so we're both optimistic we can do it fairly efficiently and effectively. I would hope that we might be in the position to reach an agreement around the end of the year, but we've got to make headway and see what our progress is actually like.

EDUARDO FERREYROS: Yes, I agree. We already have a date for the first round of negotiations. That will be in July, the 5th, 6th, and 7th of July in Lima. We are going to work intersessionally. Our teams have already been talking, so I agree with the Minister. We are going to have a comprehensive and a high-quality agreement and I think it is possible to have an agreement at the end of the year and I hope that happens. If it doesn't, we will continue work as until we find the right agreement, but I am very optimistic that we will work fast and we will have an agreement probably at the end of this year.

JOURNALIST: What are those key industries that you see the two countries working collaboratively on?

STEVEN CIOBO: Well Peru is, from Australia's perspective, another gateway into Latin America. Latin America presents terrific opportunity and frankly, the Australian business community hasn't historically looked towards Latin America. We see real growth potential in Latin America and being able to build on the Chile free trade agreement with this – a comprehensive, ambitious free-trade agreement with Peru – will provide another opportunity for Australian businesses to engage. Bear in mind, the reason we do this is because this helps to promote economic growth in Australia. It helps to ensure that we have job opportunities for Australians and ultimately I make the point repeatedly, trade deals are not zero-sum games. This is about producing a win-win outcome. Now Australia's opportunity to engage with Peru, we have many areas where we have similar interests. Minister Ferreyros and I spoke about opportunities in particular with respect to mining services. Peru has a rich history in relation to mining. Australia has a rich history in relation to mining. There are opportunities for us to learn off each other, opportunities for businesses to engage with each other around mining services, for example. But it's more than that as well - opportunities with respect to agriculture. Currently Australian agricultural exporters face prohibitively high tariffs in Peru, some of them as high as 29 per cent or more, and we want to make sure that we can do a good-quality deal in that respect.

EDUARDO FERREYROS: Yes, I think this agreement, as comprehensive as it is, is not only about trading goods, but it's on trade on services, it's about investment. My visit here actually, this is my second day here in Australia. I was yesterday in Melbourne, participating in an infrastructure forum. We need infrastructure. We need technology that Australia can work with us. I am now here in Sydney. I started the day signing an air services agreement between our countries that that will make us have better connectivity. We are going to work on that. We are having this meeting with Mr Ciobo about launching these negotiations. After this, we are going to sign an agreement on working holidays. I think that's particularly important, because we are countries that are very far away, but we are getting closer and closer and we need not our governments to get closer, but our people to get closer, our people to know each other and we are working on that. We are talking right now about trade and the free-trade agreement, but our agenda is much bigger than that and I think we are going to succeed. I think Australia and Peru are going to be closer and closer every day and that's what we are working on.

JOURNALIST: Just in terms of agricultural exports what are the opportunities for Peru to purchase farm products from Australia and would you prefer to eat Australian beef or kangaroo?

EDUARDO FERREYROS: I don't understand the last part of your question.

JOURNALIST: Exports already exist, between Australia and Peru. Do you prefer beef or kangaroo?

EDUARDO FERREYROS: Oh yes. I am going to try at lunch time. I have - no, I'm kidding, I've been in Canberra before and I love the way you live with the kangaroos. I see them everywhere. I think we have both opportunities in agricultural products. We buy agricultural products from Australia and I think there are opportunities for Peruvian, what we call, 'Superfoods of Peru' to be more present in the Australian market. We have launched these brands, Superfoods Peru, that have to be with food related to health, good eating, I'm talking about quinoa but also about blueberries as power food, avocados, fruit or vegetables in general so I think we can be complimentary in the agricultural sectors. An idea is to eat food at low cost, so tariff always increase prices for our people so I think we can work and we are going to do pretty fine on that.

JOURNALIST: What about the other way, maybe Minister Ciobo you could say, is it beef that we're looking to get into the market?

STEVEN CIOBO: I always generally refrain from commenting on sector by sector, but what I would say for example, is if you look at by one example, sugar. Sugar – Peru currently imports around $150 million worth of sugar per annum. Australia currently has zero out of that sugar. We've got a 29 per cent tariff, up to a 29 per cent tariff on sugar, so there's opportunities, and I use that by way of example, in relation to agricultural products. But also more broadly though, as Minister Ferreyros commented, there's work we can do in relation to investment. One of the initiatives that the Minister is undertaking while he's here is to open a new trade office, in time, for Peru here. That helps to drive the investment relationship. Driving the investment relationship from Australia into Peru, from Peru into Australia helps to bind businesses and that in turn helps to bind those people-to-people links. Of course, many Australians take the time to travel to Peru, they know about some of the tourism features of that and like me we both share tourism responsibility. I want to make sure that we continue and improve Australia's standing as a destination for Peruvians and more broadly for those from Latin America to travel to Australia to experience Australian culture, to experience the Australian lifestyle. So it's not just about particular agricultural products, it's actually about a full suite of the comprehensive trade deal that embraces those people-to-people links, the investment links, the goods and services links.

JOURNALIST: Minister just briefly, if you don't mind, on a local matter and the M1, which runs through your electorate. How concerned are you that, that particular road way is now reaching a critical point of congestion?

STEVEN CIOBO: We continue to see, of course, as the development takes place on the Gold Coast and in Brisbane that the demands on the M1 keep growing, that's a key part of the reason why the Coalition Government put money on the table for the M1. We wanted to make sure that the widening of the M1 took place and I'd repeat again that the Coalition Government has provided funding for the widening of the M1 on the south side not once, but twice. We've actually funded that same road project twice. We need to clearly, continue to invest in broadening Australia's road network, that's part of the reason why, as a Government, we've been so focused on getting our budget back into balance so that we have money available to invest in important road infrastructure. We, of course, have a very substantial roads package that we outlined in the Budget. We've also got an important rails package. The Inland Rail, in time, as part of our long term vision, will take major freighters off that road, transport network, especially between Brisbane and Sydney, which will also help the M1. So we've got a number of options. Look, ultimately though the M1 has got to be driven by the Queensland State Government. We're providing a huge amount of support to the State Government of Queensland to help with that road project. But I am very aware that residents say that they want more work done. We're taking important steps, we're investing hundreds of millions of dollars on the projects that we've announced. But we've got to keep expanding the capacity of that road.

JOURNALIST: What more would you like to see the Queensland State Government do?

STEVEN CIOBO: Look,I think we've reached the stage now, on the M1, where we need to find a more permanent longer-term solution. Part of that focus was making sure that we recognise that as we continue to see more and more development on the Gold Coast, as we continue to see infill development between Brisbane and the Gold Coast the demands on that road will continue to increase. I had conversations with Ferrovial. Ferrovial is an international player when it comes to major transport infrastructure. I am determined to do what I can to make this road work better for residents and conversations that I'm having with Ferrovial will look at options to bring private capital in to that as part of a solution, so it's not just about Government providing funding, it's about what we might be able to do together with the private sector to get a better, more long-term solution to the M1.

JOURNALIST: Minister I hope you can give us an update on the TPP. We understand it's been signed without the United States. Is it worth really focusing and putting so much effort on this TPP without the United States?

STEVEN CIOBO: Would you like to make some remarks?

EDUARDO FERREYROS: Yes. The TPP was already signed with 12 countries we are now 11 countries, we are having meetings because we believe this is an agreement that will bring benefits to our countries, it's very comprehensive, high quality. We are having conversations at a ministerial level on how to work to make this agreement enter into force. Every country has their own procedures, in Peru we have a domestic procedure that we have to go through Congress. We are working on that but we are right now having conversations in Hanoi, we have a meeting, we talk about the future of this now TPP-11 countries, and we are going to keep talking about how to make this work.

STEVEN CIOBO: Certainly I was very buoyed at the statement that was released by the TPP-11 countries in Hanoi on the weekend, a statement that made it clear that we all recognise the benefits of the TPP, that we're going to assess the options on a way forward and thirdly that we want to bring the agreement into force expeditiously. That is a demonstration of consensus among the 11 countries. Whether we'll be able to do that, time will tell, but importantly we're all committed to trying and that's a real shot in the arm to recognise that there is benefit there and we hope to be able to reap those benefits in time.