Source: Australian Attorney General’s Agencies
Patricia Karvelas: Trade Minister Don Farrell is in Paris at the moment, meeting with his European counterparts on the sidelines of the OECD Ministerial Council Meeting. I spoke to him a short time ago. Minister, welcome to the program.
Minister for Trade: Thank you, Patricia.
Patricia Karvelas: You’ve said talks have been positive. What’s different this time round?
Minister for Trade: The world has changed since the last time we had had negotiations with the Europeans. The fact that we’ve had the largest group of trade ministers meeting here in Paris this week, I think is a pretty good clue that most countries think that things have changed and that those countries that are committed to free and fair trade, as we are, need to do more to ensure that we make progress and show the rest of the world that we can in fact prosper by free and open trade. I think that’s the key thing that’s changed in the last 18 months, Patricia.
Patricia Karvelas: And has there been an escalation in the interest, the enthusiasm, essentially because of the Trump agenda that’s upended global tariffs and the global tariff war?
Minister for Trade: Look, I think certainly this week I’ve probably had more discussions with more countries in the space of two days than I’ve ever had in the past. Those countries that are interested in free and fair trade want to do more. You’ll recall one of our first interviews, Patricia, I was in Japan. We were renewing our trade relationship with Japan. We wanted to commit to diversifying our trading relationship and that’s exactly what we’ve done. We’ve got new trade agreements. We want to do more trade agreements. Every time we do one of those trade agreements, we improve the prosperity of our country. What we know is if you’re an outward facing company, then your profits are likely to be higher than one just selling internally. And secondly, and I think importantly, the wages of your staff likely to be higher. So, there’s lots of good reasons why we should trade, and other countries feel the same way.
Patricia Karvelas: Can you name any countries that look like they might be interested in perhaps changing the arrangements between us and them where the actual dial has changed significantly?
Minister for Trade: Well, you know, the European Union, that’s 27 countries just in one hit there. I had a very, very good meeting with the new Trade Commissioner, Maroš Šefčovič. Fortunately, he’s Slovakian and one of my staff speaks Slovakian, so that’s very good. He’s made it very clear that those 27 countries are interested in another crack at a free trade agreement. It was a very positive meeting. There was a lot of warmth in the room. We’ve sent our officials off today to Brussels to see if we can nut out the bones of an agreement. And if we can, we’re going to move very quickly on that one.
Patricia Karvelas: What sort of time frame are you thinking?
Minister for Trade: Look, I’m reluctant to set a timeframe because, of course, that creates expectations and, you know, if you don’t meet them, well, it looks like you’re not making progress. But both of us have agreed that we’ll move as quickly as we can. I had a very good meeting with my good friend, Trade Minister Goyal from India. He’s keen for a fresh trade agreement. We can do more with India. India, the largest country in the world now. A country where by 2030, they say that they’ll have 900 million people in what they describe as their middle class. And what we know is when people move into that middle class, their expectations of food and wine go up. And, of course, no country produces better food and wine than Australia.
Patricia Karvelas: Well, I think we can agree on that. Let me take you to the EU sticking points. In the past, we’ve obviously had disputes over the naming rights of things like Prosecco or feta. Does it look like they might be moving on those issues?
Minister for Trade: Look, it’s early, early days, Patricia. I’m hoping that with some goodwill and some tough bargaining, there’s still going to be plenty of tough bargaining to go on that, we can resolve all of the outstanding issues that were the impediments to getting an agreement last time. We have to be prepared to compromise. I think we have to make compromises if we’re going to get an agreement, but so do they. I think if we can, if we can reach a point where both of us feel that the agreement is in the best interest of both of our regions, then I think we can get there.
Patricia Karvelas: Ok. And the opposition has already said that you need to be playing hardball. And clearly, they’re kind of putting out the markers of what they would consider, indeed, a fair deal for Australia. Are you playing hardball?
Minister for Trade: I’m doing what I always do, Patricia, which is coolly and calmly negotiate these things through. I mean, you have to remember this opposition. When we came to government three years ago, we had $20 billion worth of trade impediments from China. That opposition didn’t get a single tariff removed, a single extra kilo of beef into China. Come last Christmas, we got the final impediments moved when we freed up crayfish sales back into China. And, you know, not only did we get that $20 billion worth of trade back, but when it did come back, we’re actually selling more than we were before the impediments were introduced. That’s certainly the case with a whole range of the products.
Patricia Karvelas: There have been improvements. Let me put this to you. The EU wants greater access to our skilled migrant scheme. Is that something that you’re willing to look at?
Minister for Trade: Look, these are all things that they can raise, and we’re raising issues too. As much as I’d like to do the negotiations on the ABC.
Patricia Karvelas: Ok, but is that a hard no for you or are you open to that concept?
Minister for Trade: Look, look, look, they are entitled to put issues on the table just as we are. And we’ll work through all of those issues. And I think my job is to come up with the best possible agreement that improves the prosperity of Australian businesses and Australian workers. And that’s exactly what I’m going to do in this process.
Patricia Karvelas: Now, you’ve also met with Jamieson Greer, that’s the US Trade Representative, on the sidelines there of this OECD meeting. I’m guessing you pretty much pressed the case on tariffs. Did you ask, Minister, for the same deal as the UK has on metals’ tariffs? Because we’ve got that 50 per cent tariff now. Have you asked for the 25 per cent tariff?
Minister for Trade: No, I’ve asked for a better deal, Patricia. I’ve asked for the removal of all tariffs on Australian products. And the reason for that is that, and I think we might have discussed this on a previous occasion, our trade relationship with the Americans roughly works this way. It’s worth $100 billion, $70 billion is what the Americans sell us, $30 billion is what we sell them. The trade relationship between Australia and the United States is overwhelmingly in the United States interest benefit. And so, I think that the best position that we can adopt is simply that we don’t accept that we should be subject to reciprocal tariffs when the trade relationship is so overwhelmingly in favour of the United states.
Patricia Karvelas: Sure, but the UK currently, though Minister, with respect, does have a better. I mean, it’s still a tariff, but it has a better rate of tariff than we do. So, you might have asked for something better, but currently the UK has the better deal. Have you been trying to press for a deal? Are we likely to get a deal with the US?
Minister for Trade: What we would like, Patricia, is for the United States to honour the free trade agreement that’s been in place now for 20 years which says that all of these products should be going into the United States tariff free. That’s our position, Patricia, and that’s what we want the Americans to do. And that’s what I’ll continue to press Mr Greer and Mr Lutnick for.
Patricia Karvelas: What reception did you get when you asked?
Minister for Trade: Look, he understood, and he acknowledged. In fairness to him, he acknowledged that the trade relationship between Australia and the US is very much in their favour. I mean, look, he’s a busy man let me tell you. What the Americans have done is tear up 80 post war years of trade agreements and said that they want to rewrite those trade agreements in the space of 90 days. Now, we’re already 60 days into that 90 days, and only one agreement has been released – reached – and that’s the one that you referred to with the United Kingdom. So, obviously –
Patricia Karvelas: Just to be clear, are you hopeful that we will get a deal just like the UK has now?
Minister for Trade: I want a better deal than the UK. I want America to honour its obligations under our free trade agreement and remove all of those tariffs: the 10 per cent tariffs on goods other than steel and aluminium and the 50 per cent tariffs on steel and aluminium.
Patricia Karvelas: But you have to accept that that’s unlikely given Trump’s agenda, right so that’s where the negotiation comes in. Right now we don’t have a deal at all.
Minister for Trade: Patricia, no, well that’s true, that’s true. We don’t have a deal. But Patricia, anybody who thinks that they know how this is all going to play out is kidding you. There’s still a long way to go out, to go in this process. Already we’ve seen pushback in the American legal system to the introduction of these tariffs decisions, overturning the tariffs. Sure, there’s a long way to go in the legal processes there. But look, we’re, we’re going to be staying calm. We haven’t retaliated. Some countries have retaliated. I met with the Chinese Trade Minister, Wang Wentao, that was my tenth meeting with him. He indicated to me what their response to the Americans was. I indicated to him that Australia was not going to retaliate. We didn’t retaliate when we were subject to tariff increases by China. We’re not going to retaliate against the United States. We have a very strong defence relationship with the United States. But, Patricia, we are going to press our arguments strongly for the removal of these tariffs.
Patricia Karvelas: You mentioned defence. I just need to check, are you linking the defence spending at all with this?
Minister for Trade: No. We are not two separate issues. We have an excellent Defence Minister in Richard Marles, and he’ll continue to progress the the AUKUS discussions. We’re not going to link the two. You might recall that Mr. Dutton was proposing to link the two I think –
Patricia Karvelas: I recall absolutely, which is why I’m checking. Minister, we’re out of time, but thank you so much for joining us all the way at a very different time from Paris. Appreciate your time.
Minister for Trade: Great to talk with you, Patricia.