Source: Minister for Trade
Patricia Karvelas: Don Farrell is the Trade Minister and he’s our guest this afternoon. Don Farrell, welcome to the program.
Minister for Trade: Nice to be with you.
Patricia Karvelas: What was your role in getting the critical minerals deal over the line?
Minister for Trade: Well, I was part of Team Anthony Albanese in trying to ensure that we put our best foot forward in terms of our meeting with the American President and that we had something realistic to offer the Americans. I met with my counterpart, the United States Trade Representative, a couple of weeks ago in Kuala Lumpur. I said to him, “How can we assist the Americans in this process?” And he was very clear to me that critical minerals was going to form a very much a part of the future between Australia and the United States. And of course, our ambassador, Ambassador Rudd, has been working very hard since the first lot of discussions on this topic a number of months ago to get an outcome that’s both very good for Australia and very good for the United States. So, it was a team effort, and I’m very pleased that when the Prime Minister met the President, we were able to sign a long-term agreement in terms of critical minerals.
Patricia Karvelas: You’ve said it took time, though, for the Americans to understand what we were offering. So, can you be clear in terms of your analysis, having been at the centre of this, what you think changed?
Minister for Trade: Look, I think a number of things changed. Don’t forget, Patricia, that the first time that we raised this with the Americans, it was a very new administration. So, they’d only just come into office, I think, as time went on, and Ambassador Rudd explained to the Americans what the benefit for them in this agreement was, that they came to understand that this was important for both of our countries. I mean, critical minerals are the future. Australia is the lucky country in terms of critical minerals, as the Prime Minister is want to say. We have virtually all of the items on the periodic table, and we either have the most or second most of all of the reserves of critical minerals in the world. What we’ve also got is the expertise to extract these minerals. I’ve just left a meeting with the Governor of Utah, he’s over here in Sydney to talk about critical minerals. The Americans understand that our technology to extract minerals is very good. And of course, what we want to do is value-add those products. And to do that, we need investment from overseas. And what this agreement commits both countries to doing is investing in that extraction and production of those critical minerals into the future that are going to be so important for the net zero project, for AI, for data centres and a whole range of other products.
Patricia Karvelas: But on the key question in relation to what got them over the line? You’ve explained some of your analysis, but really, it’s China, isn’t it? It’s the changes China made that meant that the US realised that they had to take this proposal pretty seriously.
Minister for Trade: Yeah, look, I think Australia learnt in the couple of parliaments ago what it means if you put all your eggs in the one basket. And I think what this agreement does, it gives alternative sources of the critical minerals that are so important into the future. So, yes, this does mean that America has more choices in terms of where it buys its critical minerals. But of course, for Australia, it means that we can develop, we’ll have the financial resources to develop these products and improve the prosperity of both our businesses and our workers in this country.
Patricia Karvelas. So, since this critical minerals deal has been signed off, have you spoken to your Chinese counterparts?
Minister for Trade: No, I haven’t. But I’m going to the world’s largest trade meeting in a couple of weeks’ time, and I’m hoping to continue my very good relationship with my counterpart, Wang Wentao, the Chinese Trade Minister will be taking probably around 300 Australian businesses to do more trade with China. We always get a very good welcome when we go to this trade event, and I’m looking forward, as we did last time, to doing lots and lots more business with China. We have a diversification –
Patricia Karvelas: Okay, so you don’t think this is going to have a negative impact on the relationship with China because if you look at some of the rhetoric coming out of China right now, they’re not happy.
Minister for Trade: Look, we have a very good relationship with China. The Prime Minister was, before he went to the United States, of course, he spent some time in China. He’s built a very strong relationship with the President of China. China is our largest trading partner by a long way, Patricia. Last year, we sold something like $330 billion worth of two-way trade between Australia and China. It’s a very important market. We want a good relationship with China. I don’t think this agreement with the United States will have any impact on that at all. And as I say, I expect to be warmly welcomed when I attend the big trade fair in Shanghai in a few weeks time.
Patricia Karvelas: Okay, a deal on critical minerals was often spoken about as leverage for a deal on tariffs on tariff reduction. Did we wave the white flag on this? Did we just give up?
Minister for Trade: No, no. In fact, only an hour ago, I raised this very issue with the Governor of Utah, that we think that the American government should be honouring the terms of our free trade agreement and removing those tariffs. But look, understand this. When we came to government in the last Parliament, it took us three years to remove all of the tariffs that had been applied by China. These things don’t get resolved overnight. As nice as it would be to flick your fingers and resolve the issue, they don’t get resolved. But I think the warm relationship that’s now been established between our Prime Minister and the President of the United States means that we can continue this discussion and hopefully in the not too distant future we can explain to the Americans that this tariff regime that they’ve set up is actually counterproductive and that we should return to tariff free, free and fair trade between Australia and the United States.
Patricia Karvelas: But just in terms of the nexus, because early on, and you know I follow this closely, early on there was a nexus that Australia was establishing between the deal on critical minerals and a tariff reduction. Why did we just walk away from linking the two?
Minister for Trade: Look, I don’t think we’ve walked away from anything, Patricia. It’s still the position of the Australian government that these tariffs should be removed. Now, we were able to make progress on the critical minerals issue. We didn’t resolve the issue of tariffs, but we haven’t given up. It’s going to take some time. Unfortunately, it’ll take longer than you might expect, Patricia. It would be great if we could resolve these issues overnight. That’s just not the way these international discussions work. But every opportunity- so, I’ve met my counterpart, Jamieson Greer, four times in the last three months – on every occasion I’ve raised the issue of the removal of the tariffs. The Americans understand that that’s our position. I mean, the President did note at the meeting earlier this week that Australia has the lowest tariffs of any country in the world. So, we’ll continue the discussions, and I’m sure at every opportunity we’ll seek to convince the Americans that the policy of the application of these tariffs is wrong, that we do have a free trade agreement that allows for free and fair trade between our two countries and that one day we will succeed in removing those 10 per cent tariffs.
Patricia Karvelas: Do you text Jamieson Greer? Are you like texting friends?
Minister for Trade: I do text his counterpart, Howard Lutnick. I’ve had a lot more face-to-face meetings with Jamieson Greer. So, the necessity to text him. But he’s very good friends with the Governor of Utah who I’ve just met earlier today, and I understand he has texted Mr. Greer with a photograph of us shaking hands.
Patricia Karvelas: Okay, a bit of a bromance. Another question, and you may not know this, but obviously, the relationship between Donald Trump and the Prime Minister is important here. Is the Prime Minister building that at a personal level? He said he didn’t text Donald Trump, but is that the sort of way you would like their relationship to evolve? So, that it is much more direct?
Minister for Trade: Look, Anthony is, Anthony Albanese is a really personable fellow, and I think he, as part of his job as Prime Minister, he goes out of his way to build relationships with, you know, all of the countries in our region and all the important, important allies. And I don’t think his relationship with Donald Trump is going to be any different. He wants, I mean, America, let’s face it, America is our most important strategic military partner. We want to build those submarines in Osborne in South Australia. We need to have a good relationship with the United States, but so too with China and so too with the European Union. So, unlike the –
Patricia Karvelas: Fair enough. Can I just ask one follow-up question then?
Minister for Trade: Yep.
Patricia Karvelas: And that’s, it’s a, it’s not strictly in your portfolio, but it has implications. Beijing has really ramped up criticism of Australia over that tense military encounter over the South China Sea, and it’s accused the Australian Defence Force, and I’m quoting here, of “distributing twisted and absurd propaganda and provoking China.” What’s your response to that, Minister?
Minister for Trade: Look, I’m, as you said, I’m not the Defence Minister, and I will leave comments on the Defence matters entirely to him.
Patricia Karvelas: Does it have an impact on you, though, and the work you’re doing, as you say, trying to build that relationship with China?
Minister for Trade: Look, my job is to push Australian companies out the door to try and do more trade. Why is that important? Well, our prosperity into the future depends on us being able to continue to engage in free and fair trade. I’ve built up this meeting that will take place in a couple of weeks time, will be the 12th meeting between me and my Chinese counterpart. So, my job is to build that relationship so Australian companies can improve their prosperity and their ability to sell into overseas markets. And that’s my job, that’s what I want to do, that’s what Australians want me to do, and that’s what I’ll continue to do.
Patricia Karvelas: Minister, thank you for joining us this afternoon. A pleasure to have you on the show.
Minister for Trade: Thank you, Patricia.