Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Hansard source

Let me say from the outset that I am not a critic of open trade; indeed, I support it. However, I also do not want to see Australian trade regulated in a way that actually constrains free trade as opposed to liberalising it. The TPP is a document of 16,000 pages. I have not read the 16,000 pages, and it is unlikely that I will. However, that is 16,000 pages of more rules, regulations and compliance that will be required for the parties that wish to trade between one another. What I will do is rely on the expertise of others who have experience in both interpreting international agreements and deciphering how agreements interact with other agreements that Australia is already a signatory to. I will also look with interest at any comments made by the parliament's Joint Standing Committee on Treaties after that committee has reported to parliament on the treaty. I find it regrettable, however, that neither the opposition nor the parliament nor the treaties committee had access to the agreement until after it was signed.

I am not convinced, nor have I seen any rational explanation, as to why the TPP and other similar agreements are not subject to parliamentary scrutiny and parliamentary ratification before they are signed by the government of the day. In my view it is a serious flaw in our democracy that should be addressed. No law can be made without being approved by parliament and then assented to by the Governor-General here in Australia, yet the government of the day can currently sign agreements that bind Australia to international laws over which Australia has no control or power to change. Parliament's ability to reject enacting legislation is not sufficient. Furthermore, scrutiny by the parliament prior to signing most likely would result in a better agreement, just as it results in better laws. I also believe that such agreements should be subject to an independent national interest test being provided to the parliament—an analysis which we have some confidence in—prior to the signing of the agreement, but that is not the case at the moment.

What we know about the TPP is what has been reported about it by the minister through leaks and by comments made about it in other countries. The Trans-Pacific Partnership is a trade agreement between 12 Asia-Pacific countries, which account for approximately 40 per cent of global GDP. It covers Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore, the USA and Vietnam. Notably, it does not include China and Taiwan—therefore I do not know how compatible the agreement is going to be with the recently-signed China-Australia Free Trade Agreement, as one example. What I do know is that the agreement has drawn much criticism from within signatory countries and from within Australia. That criticism cannot simply be dismissed as misinformed fearmongering. As we have seen with other agreements, clauses within them can be used to challenge government decisions or alleged trade breaches, even if the purpose of those challenges is simply to delay a trade transaction.

The 600-plus Investor-State Dispute Settlement clause cases are very real. The statistics over the cases that have been settled to date speak for themselves. The winners of those cases are mostly the multinationals. Indeed, my understanding is that of the cases that have been settled, about one-third have been ruled in favour of governments and two-thirds have been either settled out of court or won by the multinationals concerned. Assurances given by the government that Australia has written in ISDS protections are yet to be tested in the courts. There are also questions about labour movement, pharmaceutical patents and copyright, which I have little doubt will also lead to more protracted and expensive court cases.

While talking about expense: the Philip Morris case, whereby Australia's plain-packaging tobacco laws were challenged, cost around $50 million. Indeed, some will argue that, in time, the cost of those court cases could well outweigh any benefits that may have flowed back to Australia as a result of being a signatory to the TPP and other agreements.

Concern about trade agreements has come from many quarters: the Productivity Commission; the Chief Justice of the High Court, Justice Robert French; industry leaders; the trade union movement, academics; and numerous community groups have all raised concerns about these agreements. From my observation none of these groups have any personal vested interest in the matter, and therefore I see no reason why they would raise their concerns other than for genuine reasons about problems that they foresee with the agreements. The flip side of that is that most of the agreements seem to be driven by multinationals, and for them there is a lot of money at stake. It seems that they are the ones who are driving these agreements, so I ask the question of those who criticise any critics of these agreements: what is in it for the critics? What is in it for those people who raise the concerns? I think very little, other than the best interests that they have for the broader community.

The TPP has also been the subject of considerable political division in other signatory countries, including in the USA, New Zealand, Vietnam, Japan and, I believe, in Malaysia; so every other country has also had its own internal concerns about it. Indeed, with respect to the USA, I understand that it has now become a presidential election issue.

A more serious concern is a recent report by the World Bank that the TPP would grow Australian GDP by only 0.7 per cent by the year 2030 and that the main winners would be the developing countries. Those figures are obviously based on extrapolation. Nevertheless, they point to a very real concern in the report put together by the World Bank with respect to the TPP.

Advocates of these agreements point to an increase in trade between Australia and its trade partners in recent years—as the member for Hume did when he spoke only a few moments ago. What they fail to say is that most of the increase in trade took place before the signing of any agreements; it was occurring without agreements being signed. They also fail to acknowledge the effect that the fall in the value of the Australian dollar has had and is having on trade. Indeed, the lower Australian dollar would significantly overshadow the promised reductions in tariffs that are tied to these agreements.

Claims about the benefits of trade agreements are not supported by the monthly trade figures either. Australia has now recorded 21 consecutive monthly trade deficits, with the value of exports during December 2015 falling by $3.5 billion, below the cost of imports, according to ABS figures. Australia's export earnings slumped by five per cent during December, led by a 9.3 per cent decline in the value of rural goods exported. I repeat that: the value of rural goods also dropped. Australia's cumulative trade deficit for 2015 has now blown out to $32.7 billion. That is more than double the 2014 deficit. That happened after we signed several trade agreements, but members on the government benches keep telling us just how good those agreements have been for the country. The figures simply do not stack up—and these are not my figures; these are figures from the ABS. Again, they speak for themselves.

Multinationals appear to be the winners from the TPP. Time will tell just who will benefit from it. Anyone who tries to predict what might or might not happen is purely speculating at this point in time. But there is good reason to have concerns about this agreement based on the agreements we have already signed and the actions that have arisen from those agreements.

The last point I would make about trade more broadly is this, to go to the very comment I opened with: I support free trade. But I see these agreements as creating more regulations and more barriers for the people that want to trade with each other across the world. The multinationals of the world know very well how to manage their affairs at the global level; they have proven that time and again. It seems to me that the demand for exports and imports will be driven by community demand and by the price of the goods that are being offered—more so than by any free trade agreement.

Debate adjourned.

See this speech in context