Penny Wong, TOPIC: CHINA FTA

SENATOR THE HON PENNY WONG

LEADER OF THE GOVERNMENT IN THE SENATE

SHADOW MINISTER FOR TRADE AND INVESTMENT

SENATOR FOR SOUTH AUSTRALIA

TRANSCRIPT

17 November 2014

ABC RADIO NATIONAL DRIVE WITH WALEED ALY

E&OE - PROOF ONLY

ALY: Penny Wong, thank you very much for your time.
WONG: Good to be with you Waleed.
ALY: So, a day for congratulations for the Abbott Government notwithstanding that this is of course a 10 year process?
WONG: I do acknowledge the work of Andrew Robb the Trade Minister and I also acknowledge the contribution to this outcome of past Labor Trade Ministers, particularly Craig Emerson and obviously Simon Crean who were involved in negotiating this over the 10 years. We welcome the conclusion of the negotiations and we look forward to the Government actually releasing the details of the agreement.
ALY: Well the details are kind of leaking through. One of the things that caught my eye so far, and as you say the details are scant at this stage, is that China is agreeing to drop tariffs on resources which in Australian terms really means coal. Does that suggest that the Abbott Government has really got it right in backing coal, notwithstanding China’s agreements to reduce emissions and its desire to get rid of dirty coal over the coming years?
WONG: I certainly don’t think the Abbott Government has got it right on climate change and I think that was demonstrated at the G20. When it comes to coal exports they’re a very important export for Australia, a very important industry. But the free trade agreement needs to liberalise trade in many other areas as well as removing the recently imposed and surprise tariffs that China imposed on coal. Ultimately Labor does support trade liberalisation and the reason is it’s one of the key ways in which you grow jobs and increase living standards.
ALY: But however you want to go about dealing with climate change then it seems to be that coal exports are only going to grow, at least if this deal means anything at all. I would have thought dropping a tariff means exactly that.
WONG: As I said the coal industry is important to Australia. But that’s not the only export industry that we want to look at. We want to look at what the agreement means for agricultural commodities, what it means for services. These are very important issues, as is how the Government is treating labour movement under the agreement. We want to make sure any free trade agreement increases jobs in Australia rather than replacing jobs in Australia.
ALY: I do actually want to talk about the labour thing in a moment and we’re going to go around a few of the industries and get some reaction soon. But just one final question on the coal issue. How do you think this agreement squares with what China has been saying about its emissions peaking by 2030 in its agreement with the United States and also in ceasing to use dirty coal?
WONG: Can I make this point: I think we should not underestimate the significance of the agreement that President Xi and President Obama announced at APEC. It’s an extraordinary agreement. It’s an agreement in which China says ‘we will continue to lift our people out of poverty but we will commit publicly and internationally to our emissions peaking and then reducing over time. We are a developing country and we will put ourselves on a low emissions path to development.’ That is a very important announcement and one that no matter how much the Abbott Government tries to lessen it, it really demonstrates that this Government is out of touch when it comes to climate change.
ALY: But doesn’t this agreement seem to sit at odds with that one?
WONG: I don’t agree. We know that coal will be part of the world’s energy mix. The question is how do we increase the low emissions energy globally not just in China.
ALY: What did we give up on the question of Chinese labour? Because I know that was a big sticking point and Australia was trying to resist the Australian labour market being flooded effectively with much cheaper labour coming in from China.
WONG: That’s a very good question and it’s one that Andrew Robb hasn’t answered. And my view about it is very simply this: we need to ensure a trade agreement increases not replaces Australian jobs. And that means that if we do have people movement provisions under the free trade agreement that you maintain safeguards such as labour market testing.
And of course as you know labour market testing is where an employer has to show that they’ve tried to get an Australian to fill a position and were unable to get someone who was appropriately skilled. I think that is a very reasonable proposition that most Australians would agree with.
ALY: Well my understanding is that the agreement has effectively reflected that, that labour would have to be required in Australia and that it couldn’t undersell Australian wages.
WONG: I think they’re two different issues and I don’t believe Andrew Robb has actually answered the question I just posed. Of course, the Government could never sign up to lower wages for workers coming into Australia. That would be turning on its head our system of industrial regulation that has been in place for a very long time in Australia. That’s not the issue.
The issue is whether or not jobs which are generated as a result of investment under this free trade agreement, whether the trade agreement itself enables people to come into Australia without those jobs first being offered to Australian workers. And I think if you want to make sure you get the maximum employment benefit out of trade agreements you do need to ensure you have those safeguards.
ALY: So what conversations were you having with the Chinese when you were in the process of negotiating this agreement back when Labor was in Government?
WONG: As you know when Labor was in Government most of those negotiations were conducted by Craig Emerson. Obviously I was in the Cabinet, and Finance Minister, particularly in the second term of the Government. Many of the issues which we have been talking about were obviously important to us and that’s why I say this is an agreement that has been 10 years in the making and it has the potential to really improve Australia’s prosperity, employment opportunities and growth in the years to come. But we do want to make sure it’s the right deal and that’s why we’ll examine the detail.
ALY: It’s not yet an agreement, it’s a statement of intent. Can you translate that into sort of layman’s terms? What does that mean? How long is the lag between one and the other?
WONG: I think it means that the Government didn’t get the agreement done in time so they needed to sign a statement of intent and presumably they’ll sign the agreement in the next couple of months when they finalise it.
I would say the Government should be a little more transparent than it is being. We’ve had a lot of media back grounding, a lot of information given to selected media outlets. What we haven’t had is Australians being let in on the secret of what’s in the deal and I think the Government should be releasing the text as soon as possible.
ALY: So I better let you go. Have a good night.
WONG: Thanks Waleed.
ENDS