Ken O'Dowd (Flynn, National Party) Share this | Link to this | Hansard source

My question is to the Minister for Foreign Affairs, representing the Minister for Trade and Investment. Will the minister update the House on the economy-wide benefits of the landmark China-Australia Free Trade Agreement?

Ms Julie Bishop (Curtin, Liberal Party, Minister for Foreign Affairs) Share this | Link to this | Hansard source

I thank the member for Flynn for his question, and I acknowledge the fact that he is a real champion for his electorate. He understands the benefits that his electorate will gain as a result of the signing of the China-Australia Free Trade Agreement. The benefits of a closer economic relationship with China are beyond doubt. China is already our largest trading partner, our largest merchandise trading partner, our largest source of overseas students and our second-largest source of overseas visitors. Total trade between our two nations was worth around $160 billion in 2013-14.

This free trade agreement between our two nations, which was signed yesterday, will provide even more opportunities for businesses in Flynn and throughout Australia. Last year, for example, about $2 billion of Australian manufactured goods were sold into China but faced tariffs of around 47 per cent. Once the free trade agreement is fully implemented, 99.9 per cent of manufactured goods from Australia to China will enter duty free. This is an amazing outcome. Likewise, with energy and resources exports, they will also, over time, enter China duty free.

For the first time, China has guaranteed an open door for Australian businesses to build—wholly owned and operated by Australia—restaurants and hotels in China. This is a huge boon for our tourism industry. There is a similar opportunity for aged-care facilities and hospitals in certain locations. So, in tourism, hospitality and health services—all areas where Australian businesses excel—they can now take their skills to China, and the benefits will be felt back here.

The free trade agreement will also benefit Australian companies already doing business in China, including in areas such as architecture and logistics, manufacturing and banking. In fact, last year I chaired an investment and trade roundtable in one of China's fastest-growing cities, Chengdu. Australian businesses were all present. Some of them have been there for some time, but they all see greater opportunities to grow their businesses under the free trade agreement.

Likewise for opportunities back at home in agricultural products; in processed food, as the Minister for Agriculture has told us; and in wine, where Australian winemakers are already world renowned. They can compete with the best of the world. Currently, the tariffs for wine into China are between 14 and 20 per cent. They will be eliminated over time. These are huge opportunities for our wineries in Australia.

The signing of the ChAFTA, as it is called, is a major step in cementing closer economic relations with China. Our relationship with China has never been stronger, deeper or more diversified, and I am confident that ChAFTA will be the catalyst for even further mutual gain between our two countries.