Fran Kelly:    Trade Minister Simon Birmingham is in our Parliament House studios. Minister welcome back to breakfast.           

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

Fran Kelly:    A free trade agreement with Indonesia is supposed to be signed by the end of this year. Will this move about the embassy, apparently aimed at winning Wentworth, put this trade pact at risk?     

Simon Birmingham:     Well no, Fran, and I don't agree with your rationalisation of why those decisions have been made. But to your question, it's been made very clear by the Indonesian Trade Minister that the discussions and the progress in terms of the signing of the Indonesia Comprehensive Partnership Agreement are on track. That's great news. It's a signature achievement of the Liberal National Government, particularly of Malcolm Turnbull and Steven Ciobo when he was the Trade Minister to have negotiated this agreement, to have got us to this point. And I am very pleased that these discussions are on track, that the work to get it signed by the end of this year is on track, because it will deliver significant benefits to both Australia and to Indonesia. Benefits that build on what is a significant raft of achievements of our government in terms of opening up trade access for Australian farmers, businesses and services suppliers. 

Fran Kelly:    And why are you so confident they're on track? Indonesia is a very strong supporter of a Palestinian State, no doubt about that. It has voiced strong concern yesterday over the move from the Australian Government over the Israel embassy. In fact we were even hearing yesterday the ABC heard that there was talk, within the trade area, of retaliation, perhaps suspending that trade agreement. What assurances have you received yourself?         

Simon Birmingham:     I'm confident they're on track because the Indonesian Trade Minister has himself publicly made that clear.

Fran Kelly:    Have you spoken to the Indonesian Trade Minister? 

Simon Birmingham:     I've been in touch and indeed we of course have been in touch as a government, as we were before the announcement was made by Prime Minister Morrison about these policy matters. Because that's what you do with your close neighbours and partners. But you also don't necessarily expect that two nations will always agree in terms of foreign policy positions as they relate to a third nation. But that shouldn't get in the way of a strong bilateral relationship.

Fran Kelly:    Perhaps it shouldn't but is it going to get in the way? Have you spoken, when you say you've been in touch, what reassurances, what assurances, have you received from your trade counterpart?    

Simon Birmingham:     Well Fran, far better than taking my word for it in terms of private discussions or conversations, I'm highlighting to you the Indonesian Trade Minister's public comments, publicly reported by news outlets, that make it clear that he says they are on track. And so, we take the Indonesian Government not just at its word in terms of private assurances, but its publicly stated word as well. They are close partners of Australia. We cooperate in many, many ways. We will continue to do so. That doesn't mean we will agree on every possible foreign policy position taken in relation to other nations or other circumstances. But in terms of our bilateral cooperation with Indonesia, it is strong, it will continue to be strong, we will continue to build on the cooperation economically as well as in other spheres that we have over the recent years and will do so because it is in Australia's national interest to have a strong relationship with Indonesia. And indeed it's in Indonesia's interests to work with us in terms of the investment opportunities for Australian service suppliers across education sectors, tourism sectors or others to help grow the Indonesian economy and opportunities for Indonesia in the future.

Fran Kelly:    Alright what about beyond Indonesia? Barnaby Joyce says the government should be planning for "repercussions" from the Kuwaities, the Qataries, the Saudies, the Jordanians, the Bharainies, and the list goes on. Did the Government fully consider the trade implications of this major shift in Australia's Middle East policy?

Simon Birmingham:     Well the Government considers all implications of all decisions that are made. And now we have to make sure that we balance national security interests with economic interests and ultimately do what we believe is right as well.

Fran Kelly:    So were you consulted on this and the trade implications of this?
           
Simon Birmingham:     As Scott Morrison's made clear, this decision went through processes, including the leadership group of the Government. I was part of that. I recognise, Fran, that we have to get progress in terms of the two-State solution and as a driving factor here in terms of what the Government is looking at. Clearly what has been done to date, over many, many years, has not got us to the point of a two-State solution being implemented in relation to Israel and Palestine. And so looking at options in terms of how we can progress that is something that is valid, is something the Government is committed to doing.

Fran Kelly:    And so you support this announcement?

Simon Birmingham:     I support this announcement, and I support the fact that we want to work and continue to work towards a two-State solution in relation to Israel and Palestine. A two-State solution where it is quite likely that the capitals of both Israel and Palestine will be housed in East Jerusalem and West Jerusalem, and that's long been on the cards and it's something we ought to continue to work hard towards and to encourage the rest of the world to work hard towards. The position in terms of a two-State solution, that we share with much of the rest of the world, including with Indonesia, and it's one that we will continue to work as a Government towards. 

Fran Kelly:    Minister, more positive news for the Government. The Senate's on the brink of passing the Trans-Pacific Partnership. You're yet to commission independent modelling on the TPP. Does that mean it's hard to get a much of grip on what's in it for us?

Simon Birmingham:     Well there has been modelling undertaken by Johns Hopkins University, for example, which has shown that by 2030 there'll be a $15.6 billion lift to Australia's national income as a result of the passage of the TPP and its coming into force. That's great news. It's important that it comes into force this year because if it does and we get the deal done, and Australia part of that, by the end of October, then there'll not only be tariff reductions for our goods on it coming into force but again on the first of January next year. So you get a double benefit there. But there's also a risk that if the legislation doesn't pass the Senate in time for us to then be part of that first six by the end of this month then our exporters will be left behind. Other nations will get the advantage of that double tariff cut into what are key markets for us. It'll mean that our beef exporters into Japan will be at a disadvantage to other exporters. That our wine exports to Canada or Mexico won't get the type of benefits that they can under what is our first ever trade agreement with those nations.  

Fran Kelly:    You're listening to RN Breakfast. It's seventeen past six. Our guest is Simon Birmingham, Federal Trade Minister. On other matters, Minister, the Government had a pretty bad day yesterday. One blunder was its initial support for Pauline Hanson's 'it's ok to be white' motion. You yourself voted for that motion that included that white supremacists slogan used by hate groups like Ku Klux Klan and others. Why did you do that?   

Simon Birmingham:     Fran I'm pleased you asked because I haven't had a chance to publicly comment on this to date. Look, sometimes you have to own your mistakes. It was a failure on my part not to have checked that the Government position on that motion was as I had expected it to be given previous decisions were that we would be voting against it. I turned up to a division, I voted with government Senators at the last stages of that division as you would usually expect a member of the Government to do. Clearly my failure earlier to have checked that or not to have double checked that was a mistake. I'm sorry for the perceptions that has created. Obviously we rectified that yesterday by getting the vote re-committed so that we could ensure the Government's position, as it had always had intended to be, was reflected on the Senate record.    

Fran Kelly:    I think a lot of people are surprised that people like you at your senior level just go in and vote on something you don't know what you're voting on. I think that surprises people.

Simon Birmingham:     I understand that, Fran, and if you're not living, working in the building – you spend enough time here to know that during the middle of the day, Members, Senators, Ministers will be in meetings, in interviews or elsewhere and the division bells will ring and you will get to the Chamber with only a minute or less to spare before voting. And of course, that's why checking in advance, in terms of the Government's position, is important in those things and that was a failure.   

Fran Kelly:    Just finally you say sorry for the perceptions but some in your party room are sorry that the Government back-flipped. They're saying the Government should have stuck by the motion.  

Simon Birmingham:     Well I think anybody who thinks that is wrong. Because I appal racism in all of its forms. The problems with this motion were not just the words that were there but also the omission of words. In the end if you're going to condemn some forms of racism, you ought to condemn all forms of racism. That's certainly my position and it's the position of the Government.   

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

Simon Birmingham:     Thank you, Fran.

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