Madeleine King (Brand, Australian Labor Party, Shadow Minister for Trade) Share this | Link to this | Hansard source

I rise today to confirm Labor's support for the Customs Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 and the Customs Tariff Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021. These bills are the enabling legislation to implement the Regional Comprehensive Economic Partnership Agreement. In doing so, I move the second reading amendment that will be circulated in my name:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House:

(1) notes:

(a) the need for transparency in trade agreement negotiations such as the Government's current negotiations in relation to trade agreements with the United Kingdom and the European Union articulated in Report 193 of the Joint Standing Committee on Treaties;

(b) reports that labour market testing waivers were a feature of RCEP negotiations and are under consideration in current and ongoing trade negotiations, which would harm Australian workers and our ability to recover from the COVID-19 global pandemic; and

(c) the Joint Standing Committee on Treaties Recommendation 2 of Report 196, which calls on the Government to continue to pursue the restoration of civilian, democratic rule in Myanmar as a foreign policy priority, and consider making a declaration to this effect at the time of ratification; and

(2) calls on the Government to:

(a) adopt the recommendations of the Joint Standing Committee on Treaties in relation to Myanmar, introduce Magnitsky-style laws to place targeted sanctions on regime leaders, and use all possible international fora to condemn violent repression of protests by the military leadership; and

(b) adopt and implement the recommendations of JSCOT Report 193".

The Regional Comprehensive Economic Partnership Agreement—or RCEP, as it is known—was signed on 15 November 2020 by 15 countries: each of the 10 Association of Southeast Asian Nations, or ASEAN countries, which includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, as well as the five non-ASEAN countries of Australia, China, Japan, New Zealand and South Korea. These countries make up 29 per cent of world GDP and 30 per cent of the world's population. RCEP is, simply put, the biggest trade agreement in history, taking in one-third of global trade.

Negotiations for RCEP started in 2012 at the 21st ASEAN summit in Cambodia. Former Labor Prime Minister Julia Gillard and Labor trade minister Craig Emerson commenced negotiations for RCEP on behalf of Australia. From the very beginning, Labor has supported Australia being actively involved in the negotiation of this extraordinary example of regional trade infrastructure which was, very importantly, led by ASEAN itself. This trade bloc of our own region's creation will be bigger than the European Union and the North American Free Trade Agreement of US, Mexico and Canada. RCEP reflects the dynamism of the region in which we live. It is not just a big deal for the world; it is a big deal with for Australia. It includes nine of Australia's top 15 trading partners and economies, which account for 58 per cent of Australia's two-way trade and 67 per cent of our exports. Ratifying RCEP will mean that Australia has a seat at the table in the biggest trade agreement in the world. Importantly, Australia will be able to influence the rules as the agreement continues to develop. Once delivered and ratified by all countries concerned, RCEP will rank behind only the World Trade Organization itself in its significance.

In essence, the Regional Comprehensive Economic Partnership Agreement strengthens the rules already developed through a number of Australia's existing free trade agreements and creates new regional architecture for economic activity, with the potential to act as a forum for ongoing dialogue and cooperation. Further, RCEP includes core investment protections; rules requiring payment of compensation where an investment is expropriated; a minimum standard of treatment of investors under international law; and compensation for losses due to conflict and civil strife. The agreement provides avenues for tackling non-tariff barriers, including areas such as quarantine and technical standards, by promoting compliance with WTO rules and further improving cooperation and transparency. Importantly, RCEP supports economic capacity building and, in particular, provides a dedicated chapter addressing the capability of small and medium-sized enterprises in the region set to benefit from the agreement. These protections and transparency provisions will provide greater certainty and confidence to Australian businesses looking to invest in the region. The advantage of RCEP is that it provides a single set of rules for exporters to use rather than having to rely on the multiplicity of different rules and procedures under our existing free trade agreements. This opens up opportunities for Australian exporters looking to utilise regional supply chains.

Regional supply value chains are an essential component of the contemporary global economy. They are cross-border industrial networks producing goods where countries specialise in different stages of production associated with a finished product. RCEP, as a trading bloc, will render such value chains cheaper and easier to access for all Australian companies. As a multilateral trade agreement, RCEP is designed to streamline these rules, standards and procedures, encouraging the development of deeper value chains. For example, businesses will be able to use a 'made in RCEP' origin certificate with standardised rules for how much local content is needed to qualify. Even though there may be bilateral FTAs between nations, businesses with global supply chains may yet have higher tariffs or restrictions because some component parts are made elsewhere. For example, an Indonesian-made product may have components from Australia or China and, therefore, face tariffs applied elsewhere in the ASEAN free trade zone, but, with RCEP, all components from any member nations will be treated equally. This provides an enormous incentive for businesses in the RCEP countries to look within the 15-nation bloc for suppliers to contribute to their product. In this context, the Regional Comprehensive Economic Partnership Agreement will possibly make the Indo-Pacific the most attractive location to build value chains in the global economy, and a strong, vibrant and prosperous Indo-Pacific is good for Australia.

As an open-trading nation, Australia has been the beneficiary of the multilateral, rules based trading system that has operated for decades. Labor recognises that Australia's security and prosperity rely on our continued economic engagement with the world and integration with our region, including through trade and investment. International trade creates jobs. One in five Australian workers, more than two million people, are employed in a trade-related activity. Labor know that open trade will be an integral component of Australia's economic recovery from the COVID-19 pandemic, and we acknowledge that open trade agreements and comprehensive economic partnerships have become matters of strategic and geopolitical significance. Labor will at all times act in the national interest and in accordance with Australia's international obligations in dealing with open trade agreements and comprehensive economic partnerships.

As the WTO body stagnates and reform is stalled, regional agreements such as the RCEP are integral to creating an even playing field between Australia and its trading partners around the world, particularly in our vibrant region, from which our future prosperity will be earned. But Labor knows that the community is rightly sceptical about this government's approach to economic change and trade agreements. We all know the Liberals and Nationals treat trade agreements like trophies to put on a shelf: ink the deal, get dressed up for the photo-op, but then have no follow-up. So I'd like to take this opportunity to reflect upon Labor's approach to international trade and trade agreements.

We would do things differently while pursuing an open trade agenda. A future Albanese Labor government would promote Australia's international competitiveness, maintain a commitment to an open economy and work to increase the volume of Australia's trade with other nations. Labor has a long record as an advocate for an open global trading system. Reducing barriers to trade creates more competitive industries and benefits consumers through lower prices and greater choice. Trade is a pathway to a high-skills, high-wages future for working Australians. Labor will set out an ambitious open trade agenda in government aimed squarely at increasing the complexity of our exports in order to create more well-paid, secure jobs, strengthen economic resilience and ensure that every trade deal we sign will increase the living standards of the Australian people. Labor will promote services-sector innovation and identify the capabilities needed to establish Australia as a leading global trade and services economy.

The benefits of trade can and must be shared fairly, both at home and abroad. Labor will invest in education, training, skills and innovation, building Australia's national infrastructure and promoting the health and welfare of the community so that Australians can benefit from the opportunities created by trade. When multilateral trade negotiations, such as those of the WTO, are not making satisfactory progress, Labor will consider high-quality regional or bilateral trade agreements that are in Australia's national interests and that support the multilateral trading system. We are committed to trade policies consistent with Australian values of justice and equality, community views, workers' rights and the interests of developing countries. Trade agreements must be consistent with Australia's social and economic values, be based on widespread consultation, provide for appropriate minimum and enforceable labour and environmental standards, take account of social and economic impacts and allow sovereign governments to make decisions and implement policies in the interests of their citizens. Economic growth has been good for developing countries, but, in many economies, these benefits have not been fairly shared. More equal economic growth will create decent jobs, lifting people out of poverty and giving them economic dependence while supporting human rights.

RCEP as it stands does not have an environment chapter or a labour chapter. When Labor was last in government, the then trade minister, Craig Emerson, sought to include these provisions; however, other RCEP members were not amenable to this. Prime Minister Gillard, Trade Minister Emerson and the Labor government at the time rightly decided to proceed with negotiations, despite the setback, to ensure Australia continued to be involved in the creation of regional trade architecture. Opting out and retreating to the sidelines were absolutely not an option, and to do so would have set back Australia's relationship with ASEAN significantly. The intent of the Regional Comprehensive Economic Partnership is capacity building, bringing emerging economies up in line with established economies like ours. This stands in contrast to other more ambitious agreements with developed economies which do include labour chapters with enforceable international labour standards. However, RCEP does include ratchet measures, with the ability to continue to develop provisions in these areas through successive reviews over time, and Australia must participate actively in those reviews in the future. Labor does not support arrangements that undermine the Australian government's capacity to govern in the interest of all Australians, including any provisions that remove Australia's protection of local jobs through regulation of temporary work; that waive labour market testing; that further limit the capacity of governments to procure goods and services locally; that require the privatisation or contestability of public services; that undermine Medicare, the public health system and the Pharmaceutical Benefits Scheme; that undermine state or Commonwealth workplace laws or occupational licensing arrangements or laws that relate to antidumping. I have sought and have received clear written advice from the trade minister that RCEP does none of these things and that ratifying the agreement will not undermine the Australian government's capacity to govern in the interest of all Australians.

I can confirm that RCEP does not expand waivers of labour market testing for foreign workers. Stakeholders have rightly queried the inclusion of an instrument in the Migration Act which mentions a change to our domestic market testing regime. I've clarified with the Department of Foreign Affairs and Trade that this is a technical measure and there are no changes to labour market testing in this country as a result of participating in this Regional Comprehensive Economic Partnership. Indeed, the instrument under the Migration Act foreshadowed in the national interest assessment establishes that the obligations set out in RCEP form part of Australia's legal obligations. Such instruments are made under the Migration Act for every international trade agreement Australia enters into.

To be clear, RCEP does not restrict Australia's domestic procurement arrangements at any level of government. It does not require privatisation of any Australian Public Service, nor does it undermine the Pharmaceutical Benefits Scheme. RCEP does not undermine state or Commonwealth workplace laws, occupational licensing arrangements, nor does it undermine Australia's antidumping regime. It does not include provisions that limit the right of the Commonwealth to regulate in the interests of public welfare in relation to safe products and there are no investor-state dispute settlement provisions.

I would like to take a moment to commend the work of civil society and the trade union movement in steering this government away from implementing ISDS as a base for dispute settlement in trade negotiations. The fact that we are seeing ISDS less and less in our international treaties is a testament to the tireless campaigning of the ACTU, AFTINET and others.

Recent media reports that a former member of this place Mr Clive Palmer is exploring the use of ISDS mechanisms to sue the Australian government just go to re-affirm our opposition to them as a general provision of international trade deals. Having already forked out $1 million on legal fees, because the Prime Minister supported Mr Palmer's attempts to sue Western Australia, Australian taxpayers don't want to be stung again by another vexatious suit from a vexatious litigant that only seeks to serve himself and to damage the state of Western Australia and the whole nation.

A future Albanese Labor government will ensure that trade agreements signed by the Commonwealth require skills assessments, including practical and theoretical testing, to be undertaken in Australia, and not restrict such skills assessments for temporary visa holders, and would include in any future bilateral regional or multilateral trade agreement a labour chapter with enforceable internationally recognised labour standards.

Labor supports, and will ensure in government that, a rigorous, independent economic analysis of trade agreements is conducted. Labor would also require an independent economic assessment of the impact of each agreement to be included in the report of the Joint Standing Committee on Treaties to the parliament.

I note the treaties committee report into treaty making, report No. 193, tabled in August this year recommended:

… the Government consider implementing a process through which independent modelling and analysis of a trade agreement, at both the macro and sectoral levels, is undertaken in the future by the Productivity Commission, or similarly independent and expert body, and provided to the Committee alongside the National Interest Analysis to improve assessment of the agreement, increase public confidence in the benefits of trade agreements, and facilitate the longitudinal assessment of actual trade outcomes.

Public confidence is critical in free trade. Labor calls on the government to implement this recommendation.

This important review of the treaties committee into treaty development would not have happened but for Labor. In discussions with the government in relation to the Indonesian-Australia Comprehensive Economic Partnership the government, through then trade minister Senator Birmingham, agreed to my request that JSCOT be asked to undertake such a review. I'm glad the government allowed to this happen and gave the parliament an important opportunity to examine the manner in which it addresses free trade treaties and agreements and demonstrated the community desire for more openness and transparency from government in relation to free trade negotiations.

A future Labor government will ensure that Australians are informed about trade negotiations and will undertake full community consultation before entering new agreements. The provision of public updates will follow each round of negotiations and, where feasible, draft text would be released. Labor will ensure transparency in future trade agreements through the tabling of national interest assessments and consultation with industry, unions and community groups during negotiations. We would ensure the tabling of negotiation material in parliament where feasible, again, as recommended by the treaties committee in its report into treaty making. In relation to future trade agreements, Labor would commission an independent national interest assessment which includes a comprehensive social, economic and regional impact assessment of the negotiated treaty text, and we would implement reviews of existing free trade agreements.

Labor recognises that trade agreements should not be used to undermine Australian working conditions and that foreign workers should only be used in situation where specific skills shortages are present and only for the period it takes to train and develop the capacity of an Australian citizen to do the job. Labor does not support the inclusion of provisions in trade agreements that confer legal rights on foreign businesses that are not available to domestic businesses. But we are not yet in government, as you well know, Deputy Speaker, and, as we know, international treaties are the remit of the executive.

Labor called for the final treaty text of RCEP to be publicly released before the agreement was signed and allow it to be scrutinised. But the Morrison government refused that request. Labor has previously raised concerns over the Morrison government's refusal to commission independent economic modelling for the RCEP. There is nothing new about this all-talk do-nothing government. At a time when calm and skilful diplomacy is needed to resolve our trade tensions with China, the Morrison government has given the member for Dawson free rein to spout inflammatory comments and spread misinformation about our largest trading partner, China. Under Prime Minister Morrison, Australia is more dependent than ever on China for our exports and jobs. In fact, we depend on the Chinese market more than any other country in the world. When trade diversification is of the highest priority for this nation, the Prime Minister is putting at risk our trade agreement with the European Union due to the diplomatic ineptitude on the recent nuclear subs decision.

Labor knows that achieving genuine trade diversification will require a long-term whole-of-government commitment and a plan. Every portfolio in government should be thinking about what it can do to contribute to a national effort to diversify what we export and where we export goods and services to. In health and finance, for example. Australia has a remarkable capability that is already exported but much more can be done. Australia has $3.3 trillion of funds under management through our superannuation system. We have developed an industry that is envied around the world, and economies like Japan are looking to Australia for funds management expertise. Similarly in health, Australia is expert in providing traditional and digital health care into remote areas, which will be replicated in the complex and challenging geography of Indonesia and its many islands at a time when Indonesian healthcare companies are looking for internationally competitive health solutions.

Labor is prepared to make that commitment and build that plan in conjunction with job-creating export industries to diversify our export economy. We would work with exporters to build relationships and secure the markets that Australian jobs depend on. Diversifying export markets is more than a photo op for a free trade signing ceremony. Unlike the Morrison-Joyce government, Labor knows that our relationships with our trading partners cannot just be set and forget. Signing a free trade agreement is the beginning of the story and not the end.

In 2019, the Morrison government committed to a range of measures to secure Labor's support for the Indonesia-Australia Comprehensive Economic Partnership Agreement—namely, compelling JSCOT to review the way our country negotiates trade agreements. I'm satisfied that the JSCOT treaty-making review has been completed well, and I thank all members of the committee for their hard work in undertaking this process. I call on the government to implement the remainder of these commitments—in particular, those related to work exploitation—as a matter of urgency.

In relation to RCEP, unions and other civil society stakeholders have expressed concern regarding the potential for public regulation in the aged-care sector to be constrained under RCEP. DFAT and Minister Tehan know that there are reservations in RCEP, like in any FTA, that allow Australia to regulate in the public interest, which includes for aged-care or climate change action. The Minister for Trade has confirmed in writing to me that 'RCEP will not prevent or impair the implementation of any recommendation of the aged-care royal commission'. Furthermore, the minister has confirmed that RCEP will not constrain the government in its delivery of the reforms of aged care in response to the commission's final report. Indeed, Labor would not support any agreement that would inhibit the government's ability to implement in full the recommendations of the royal commission into aged care services. I would like to take this opportunity to thank the senior officials and all the officials of the Department of Foreign Affairs and Trade, and the minister's office for allowing them to be available to brief members of the Labor caucus over the course of this year in relation to the RCEP agreement.

I will make some final remarks on Myanmar, which as an ASEAN nation is a signatory to RCEP. Labor condemned the military coup of 1 February and the subsequent killings of thousands of civilians by the Tatmadaw in ongoing protests. This was a direct attack on Myanmar's ongoing democratic transition. We've since seen widespread arrests of politicians, activists and media representatives. These actions by the Tatmadaw are unacceptable, and the Myanmar security forces must cease their violence, ensure the right to peacefully protest and engage in dialogue with the people of Myanmar. On 2 February Labor called for the Australian government to review its military cooperation with the Tatmadaw, and over a month later that cooperation was suspended. We also called for targeted sanctions against those responsible for the coup. In April Labor called on the government to provide visa pathways for at-risk Myanmar nationals to remain in Australia. Once again, a month later, the government said that those on temporary visas could apply to extend their stay.

But the Morrison government has still not implemented any additional targeted sanctions against those responsible for the coup and the human rights abuses we're witnessing in Myanmar. This is despite many of our like-minded partners taking strong actions against the coup and despite the fact that in June the government-chaired Joint Standing Committee on Foreign Affairs and Trade recommended sanctions against the Tatmadaw and in August the Joint Standing Committee on Treaties had to, embarrassingly, remind the Morrison-Joyce government once again of the need to act. Labor members of the treaties committee worked very hard to finalise the final report, report No. 196, in relation to RCEP to reflect stakeholder concerns on Myanmar. I'd like to take a moment to thank the deputy chair, the member for Wills, as well as Senator Ayres, the member for Fremantle, Senator Ciccone, Senator Kitching and the member for Jagajaga for their tireless efforts on the committee, and all other members of the committee for the work they did in this regard.

The JSCOT inquiry into RCEP recommended that the government continue to pursue the restoration of civilian democratic rule in Myanmar as a foreign policy priority and consider making a declaration to this effect at the time of ratification. Now we have a situation where two government-led committees have recognised three times between them that there is a need for targeted sanctions against the coup leaders in Myanmar, but the Morrison government still refuses to act on this. I call on the government to act on the recommendations of the parliamentary committees that it leads and to prevent the impression from growing that Australia does not care about this ongoing crisis in our region. Australia must stand up for human rights. It is past time for the Prime Minister and the foreign minister to act in support of Myanmar's democracy and to implement targeted sanctions and to support the people and the development of democracy in Myanmar.

It is important that Australia support ASEAN in its efforts to restore democracy to Myanmar to end the violent repression of its people. ASEAN itself has taken the important step of banning the military leadership of Myanmar from its upcoming regional summit. Consequently, the military have announced the release of 5,600 political prisoners held in custody because of their participation in protests against the military coup. It remains to be seen whether these prisoners will in fact all be released, but this is an important step by ASEAN and also by the military themselves.

I am pleased to stand here today to support the passage of the enabling legislation for the Regional Comprehensive Economic Partnership Agreement. It is significant for ASEAN and of critical importance to our relationship with all the ASEAN nations in an increasingly contested region. Labor is the party of open trade. Our country's economy is as strong and as vibrant as it is because of Labor governments' acknowledgment that our future prosperity and security will only be found in the region. Our relationship with South-East Asia and ASEAN is critical to this future. Rules based trade, as contemplated by the Regional Comprehensive Economic Partnership, is a vital component of a stable and prosperous region that is respectful of sovereignty. With those words, I commend these bills to the House.

Rick Wilson (O'Connor, Liberal Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Chris Bowen (McMahon, Australian Labor Party, Shadow Minister for Climate Change and Energy) Share this | Link to this | Hansard source

It is, and I reserve my right to speak.

James Stevens (Sturt, Liberal Party) Share this | Link to this | Hansard source

I rise to speak in favour of the second reading of the Customs Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 and the associated bill. I start by saying I'm very proud to be speaking on this bill, and I hope to have the opportunity to speak on similar bills many more times, for as long as I've got the honour to serve in this place. Free trade and pursuing a free trade agenda and export opportunities for this country is one of the reasons that I've been inspired to want to serve in this place. I think that trade with the rest of the world is vital to the continued success of our country, the continued growth of our economy, the continued increase in the number of jobs in our economy and the prosperity that that brings, and I'm certainly proud to be a part of a government that has such a strong history and plans for the future when it comes to expanding and improving our engagement with the world, particularly economically and particularly through free trade agreements.

We know, of course, that we've already taken steps to pursue a free trade agreement with the United Kingdom, and I commend Minister Birmingham and, now, Minister Tehan for the progress that is happening there. It would be fantastic to see this country be one of the first nations, if not the first nation, to sign a free trade agreement with the United Kingdom now that they have exited their customs union with the remaining European Union. Equally, it's been good to see progress with regard to signing a free trade agreement with India. There's still some work to be done there, and I might make some comments about India, regarding RCEP, later on in in this address, but it's great to have such a forward-thinking agenda when it comes to pursuing free trade opportunities. Of course, this bill is the culmination of a long process, but we're happy to be now at this point, where we are making the legislative changes we need to to bring into force the Regional Comprehensive Economic Partnership Agreement that we've signed with the 10 ASEAN nations and four other nations—New Zealand, South Korea, Japan and China—as well as Australia.

Before I started a career—rightly or wrongly—in politics, I had the pleasure of working at an iconic Australian wool company, Michell. It was certainly iconic in South Australia; I think it was nationally. They're in their 151st year of operations, having commenced in 1870 in a small mid-north town in South Australia. In the eight years I worked in the wool industry, it was a pleasure to have the opportunity of travelling to most of the countries that are covered by this agreement.

Of course, the wool industry is one of the industries that, undoubtedly, built this nation, probably the first major industry since European settlement in Australia. Not just in the early days but also particularly in the fifties and sixties, it was one of the largest—and sometimes the largest—export commodity industries in the nation. Before the petrochemical textile products that we now see dominating the sector, cotton and wool made up the vast majority of fibres that were used in apparel textiles but also more broadly in the textile industry. Though wool doesn't have the same volume that it had decades ago, from a quality point of view, I think no-one would dispute that Australian merino wool and products made from Australian merino wool, like the suit I'm in right now, are some of the best fabrics and best textiles in the world. Australia, of course, is renowned for its superfine, high-quality merino wool for apparels, particularly in weaving.

Michell was a company that operated right through the wool supply chain, from early-stage fibre processing, scouring and carbonising right up through combing and superwashing for shrink resistance to spinning, knitting, and even cut-and-sew. When I worked at that company, starting as the commercial manager and then the general manager in the textiles division, I had the opportunity to work in a part of the business that was 100 per cent export, and our supply chain was right throughout Asia and South-East Asia in particular. So I had a lot of experience with the issues that are going to be addressed in the changes that are made thanks to this agreement.

I also see this agreement, very much, as a foundation, and other speakers have mentioned that this is something we can build on. Obviously, the nations that it covers are already very important economically to us. I think nine of our 15 most substantial trading partners are in this agreement. Clearly, although we have other bilateral free trade agreements with some of the nations in this, it is a good thing to bring them all together into a group of 15, because it provides an opportunity for that group to pursue and make common changes in the interests of free trade, trade liberalisation and increasing the economic activity within the member nations of the agreement.

For a country of 25 million people that's as wealthy as we are, we know that wealth comes from the fact that we export and that we make our money not only through the economy here within Australia but also, on top of that, from our ability to export and sell to a market well beyond the 25 million Australians that we have here. Free trade is a great thing. The economic opportunities are clear and obvious. For a nation like Australia, it means jobs. It means a high national income. It's also very important for the peace and harmony of the planet. For thousands of years, trade restrictions have led to significant global conflicts. If we can be more integrated economically—if we can rely on other countries economically and if we can sell the things that we make the best or the services that we produce the best to the other nations of the world and, equally, buy the best that they have to offer—we will be less likely to have conflict. That's a very positive additional benefit of free trade. It's not only the economic dividend but also the peace and security dividend of us being interconnected. If we think of the nations that are captured within this agreement, the more engagement with and the greater the depth of the economic ties and harmony between those nations that are already on our doorstep and in our region, the better that's going to be, economically and from a security point of view.

I note that India were initially a part of negotiations when it came to RCEP. They made the decision a few years ago that they would not progress towards the agreement with the other nations involved, which is now being reached and which we are now putting in place through this legislation and other nations are doing similar things to implement. That is a disappointment, but hopefully it is temporary. I know that there is goodwill amongst the other 14 nations, like there is from Australia, to welcome India into this agreement as soon as they're ready and we can come to appropriate terms with them for them to have a part of this new structure that works for India and for the other existing nations that are members.

India is very much a disappointing omission from this group of nations. I think that, if we had the Indian economy within this agreement, it would be a truly Asian agreement—with lots of scope for other nations on the periphery of ASEAN, to be sure. The Indian economy is the largest economy in the region that is not represented, and I think that, if this is a foundation that we can build on, one of the things that we want to do is to progress their membership once they are equally open to negotiating it. In the meantime, as I mentioned at the beginning of my remarks, we, as a nation, are pursuing, bilaterally, a free trade agreement with India. Whether success first comes through a bilateral agreement or via the RCEP mechanism, I'm very passionate about seeing a much more significant trade relationship between Australia and India, which will come if we have a free trade agreement of some sort with them.

There's also opportunity to deepen the terms of the RCEP. We have bilateral free trade agreements with other nations in the agreement already, of course. We have them with Japan, Korea, China, Indonesia and other ASEAN nations. Or economic zone with New Zealand is probably the most liberal trading arrangement we've got with any nation on the planet. And so I accept and concede that some elements of this agreement don't go as far as some of the other bilateral agreements that we have in place, but that wasn't necessarily what any of the parties were seeking at this stage. But I think we should have the ambition to work towards that in the years that come. I think that, if we can create some trust and goodwill through implementing what all 15 nations have agreed on and we have a mechanism to engage through this process regularly on ways to further liberalise the trade and investment relationship between the member nations, that will be a good thing.

Australia's future is clearly in trade, continuing to pursue export opportunities and continuing to seek every opportunity we can find to reduce barriers to trade and investment between us and other nations of the world, particularly those in our region. The RCEP group of countries, of course, are very much in our region.

I think this is an exciting time to debate this bill and to ratify it given some of the challenges but also opportunities, particularly in export markets, in the years ahead. It's timely that we are debating it now and, hopefully, passing it through this chamber and this parliament so that it can progress to be fully implemented not just here but amongst the other 14 member nations. I look forward to the opportunities that this free trade agreement is going to provide to businesses in my own electorate of Sturt but also right across Australia. Whether we like it or not, our future is going to be in much further integrating our supply chains and businesses across nations working together to create wealth and create jobs. This agreement is going to lead to that. I commend the bill to the House.

Josh Wilson (Fremantle, Australian Labor Party, Shadow Assistant Minister for the Environment) Share this | Link to this | Hansard source

I'm glad to make some remarks about the Customs Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 and the Customs Tariff Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021, which implement commitments that Australia has made under the Regional Comprehensive Economic Partnership. I'd like to say some things about what the RCEP is and what it isn't. We are a trading nation and our trade relations are incredibly important to our own social, economic and environmental wellbeing and also to the way that we engage with the wider world. This is a key agreement in relation to our engagement with the Indo-Pacific as a trading nation.

I sometimes feel that in the parliament and perhaps also in the wider public domain our conversation around trade can be simplistic and can fail to engage with some of the details and nuances of trade and particularly with trade-agreement-making. I reflect on the contribution that the member for Brand, the shadow minister for trade, made earlier; it was an excellent overview not just of this agreement but of trade-agreement-making and some of the things that are caught up in that process and that are important for Australians to consider.

This agreement is a plurilateral trade agreement. It's the world's largest in terms of economic coverage. As the previous speaker, the member for Sturt, said, it picks up the 10 ASEAN nations. It is effectively an ASEAN led plurilateral agreement, which is significant in itself. In addition to picking up Australia, it covers China, Japan, the Republic of Korea and New Zealand. It is a shame that India isn't part of it, and from Australia's point of view the inclusion of India would have been meaningful in expanding access to markets, as I will talk about a little bit later on. The reality of this agreement is that it doesn't give us access to markets to any greater degree than we already have, because we have existing agreements, in some cases several agreements, with all of the countries that are covered by RCEP.

It follows not too far from the heels of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership—another plurilateral. Why are we seeing these plurilateral agreements? They follow on from a period in which Australia and other nations went pretty hard in trying to settle bilateral trade agreements and, to some degree, saw the limitations of having a somewhat messy and complex set of separate bilateral arrangements. Why did we have a period of going down a bilateral path? That was because the multilateral system, the system that was put in place under the General Agreement on Tariffs and Trade and through its successor the World Trade Organization, has really run out of steam. The best indication of that is that the Doha Round commenced in 2001 and hasn't completed yet, 20 years later. Unfortunately the WTO, as the multilateral architecture for international trade, has lost its sting. There's been a significant deterioration in co-operative spirit and participation and the practical effect of what should be an effective multilateral trading system, and so we get to these plurilaterals. We've had the CPTPP, and now we have the RCEP. Australia should pursue those. Labor has always thought that a multilateral system is the best system because it has the widest coverage. But, if you can't get that, there's certainly some benefit in plurilateral arrangements like the RCEP. They're better than having a welter of bilateral trade and investment agreements.

When we enter into these agreements, in the interests of the Australian people, we should be looking to achieve trade and investment arrangements that are more fair, responsible and sustainable as well as more free, to overcome barriers that affect Australian producers both when it comes to tariffs and when it comes to non-tariff barriers. We should be seeking agreements that harmonise arrangements and avoid what's called the noodle-bowl problem, which is what I was hinting at when I described the welter of bilateral agreements. It's very difficult for business, particularly for small and medium enterprises, when they are trying to expand into a range of markets and each of those markets is covered by a separate bilateral. The things they need to conform to in order to have the benefit of those trade agreements change all the time. It becomes difficult to manage and difficult to comply with. That's what is meant when trade analysts or experts refer to the noodle-bowl problem, and sometimes through plurilateral arrangements you can help clean that up. We should also be trying to get into agreements that draw nations together in a genuine commitment to ensuring that economic activity doesn't compromise our environment and doesn't compromise workers' rights and human rights, and I'll come back to that in terms of the RCEP. Certainly in that regard there's a big difference between the CPTPP and the RCEP.

The RCEP has value as a framework, as a mechanism, for drawing the participant countries into closer collaboration, particularly when it comes to integrating the Indo-Pacific economically, but the pure economic benefits are not that great. The reality is that, even when fully matured, the RCEP would only provide tariff-free access that is equivalent to 94 per cent of what we currently have. If we were to get rid of all the agreements that exist with the other 14 nations—if we were to just click our fingers and make them all disappear—and rely on the RCEP, we would straightaway be going down to 86 per cent of existing tariff-free coverage. Even fully matured, we'd only have 94 per cent of the existing tariff-free coverage. That's just where the negotiations ended up.

The economic value to Australia is apparently going to be in what's called value-chain improvements. Some of the tariff arrangements between other countries—not between ourselves and the other 14 nations but between those nations themselves—provide the potential for economic benefits to Australian producers that are contributing into what is a multinational production chain. Those value chain improvements aren't hard to understand in concept, but they are hard to quantify, and there was nothing that could be provided to the Joint Standing Committee on Treaties to really get down to the nitty-gritty of what those value chain improvements might be. As it currently stands, through our treaty-making process we don't have any independent economic analysis. We should, but we don't, so it's very difficult to see what the precise benefit of agreements like the RCEP would be.

The RCEP could fix, but doesn't fix, the noodle bowl problem. That's related to what I've just said—we can't get rid of the existing bilaterals because it would put our producers in a worse position than they're currently in, so we need to keep most of those bilaterals and some other ASEAN-plus arrangements for their tariff benefit. Unfortunately, the potential for using the RCEP to alleviate some of those noodle bowl problems can't exist. The Australian Chamber of Commerce and Industry made an argument to the JSCOT that the RCEP would be beneficial only if Australia wouldn't 'start to clean out the agreements from underneath it'. As I said, that would have impacts in reducing the amount of tariff-free access that Australian companies currently have under those pre-existing agreements. To give an example, Australia has five separate trade and/or investment agreements afoot with Malaysia. Imagine you're a company seeking to expand and to trade into Malaysia for the first time. Which of the five would you be using?

Unfortunately, RCEP doesn't include any commitments when it comes to a nation's approach to environmental protection, workplace rights or human rights. The CPTPP did, but RCEP didn't. Even though, when negotiations commenced in 2012, Australia put that on the table and pushed for that, the other nations—those in ASEAN in particular—were not interested in including that. That's a shame. There are mechanisms by which the RCEP can evolve, and Australia should continue to use our diplomatic and trade leverage to push for those things to be included in time to come because they are important.

There's no ISDS in the RCEP, and that's welcome. That's probably not because Australia is resistant to it—the present government is quite happy with ISDS—but it was the case that other participant nations didn't want that. We've discussed in this place at length the fact that an international tribunal system does potentially give companies the right to sue the Australian government in relation to our own public policy, and I don't understand why we would ever give away our sovereignty in that respect. It puts us at risk, and we saw that with Philip Morris and the plain packaging case. There is a question mark over some areas of the Australian economy—care service industries and aged care in particular—in relation to reforms that we might seek to make in future. That was explored a lot by the JSCOT and we were given reassurances that nothing in the RCEP would compromise Australia's ability to make those kinds of rules. However, Australia lodged particular reservations in relation to child care. We lodged a specific reservation saying Australia will always maintain the ability to regulate with respect to child care, notwithstanding anything in the RCEP, but there was no similar reservation for aged care. Understandably, that raises the question: why child care and not aged care?

There's nothing in the RCEP in terms of dispute resolution or remediation that is really any different to what's in the WTO, and I think that's something we should all reflect on. The member for Brand talked about the way the government will say: 'Here's this new you-beaut trade agreement—tick! Put it on the shelf.' Let's just remember all of our recent experience of geoeconomic coercion involving China. The government told us how good the free trade agreement was with China. This is a plurilateral agreement that includes China. How much has that bilateral agreement helped us with some of the actions that have been taken in relation to Australian producers and trade over the last couple of years? Does anyone think that the RCEP is going to change that? If they do, they're not too bright. We heard through the JSCOT inquiry a list of the same kinds of concerns and shortcomings that really apply to our existing trade agreement-making process, and the member for Brand, the shadow minister for trade, talked about that list. I encourage members of the community and members in this place, if they're interested, to look at report 193. It's an unusual report in the work of the JSCOT because it's not a report on an international agreement, which makes up most of the diet of JSCOT. It's a standalone report on the trade agreement-making process itself. I've been fortunate to be a member of the JSCOT since I was elected in 2016 and I think it was a really worthwhile exercise. The report was delivered on a genuinely bipartisan basis and it makes some key recommendations about how we can improve the process of making trade agreements.

The JSCOT itself was introduced in recognition of what was called at the time a democratic deficit when it comes to the way the Australian government enters into international agreements because, but for the JSCOT, there is literally no involvement of the parliament in those agreements, other than when we get what we're dealing with here, enabling legislation. But it puts the parliament in a very difficult position when we're dealing with enabling legislation that has been committed to by the executive in a trade agreement that's already been signed. That's why the JSCOT should, in my view, be enabled to have more to do with the making of these agreements than it currently does. The JSCOT only sees these agreements once they've been signed. The recommendations in report 193 include: improved transparency; that the government publish negotiation aims and objectives in advance and both the community and the parliament get to see those documents; that the JSCOT be briefed biannually not just on agreements close to being settled but on those that are in process; that the government also looks to deliver greater stakeholder engagement through non-disclosure agreements so that there's midstream engagement; and of course that there's independent economic modelling.

I finish my remarks by again especially thanking the civil society participants in the treaty-making process, in this case and generally. I also thank the labour movement organisations like AFTINET and others. They make a huge difference despite not having any specific funding. They do it in the best interests of Australia as a whole. They raise really important issues, and without what they do we would end up with much lower-quality agreements than we get.

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

It's a pleasure to speak on these two bills, the Customs Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 and the Customs Tariff Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021, which effectively cover the RCEP agreement. When I looked at the speakers' list, I saw that most of the speakers represent regional areas. They might ask why somebody from an outer suburban seat is speaking on these bills. The reason is that, like many in this chamber, I have businesses in my electorate that export goods across the world, including many that export goods to Asian countries. I was interested in the comment that the member for Fremantle made around the veracity of agreements when governments of other persuasions decide to do something that doesn't honour the agreement, particularly in reference to China over the past couple of years. Like any agreement, it's only as good as the willingness of all the participants in that agreement to honour what's in that agreement. We've got to work very hard to ensure that we maintain those relationships and keep working on these agreements. They're not something that we can put on a shelf and say, 'Yes, that's done and that's all we're going to do with it.' They need to be continually worked on, reviewed and built upon. I recognise, as the member for Fremantle and others have observed in this debate, that we already have a range of agreements with countries across Asia. In building on those agreements or, sadly, adding to the complexity of some of them, our businesses need to make decisions as to how they're going to approach those markets. It's still important that we look to engage with these countries as groups to build a framework that seeks to broaden the agreement across a wide range of countries where we're all working together for an economic outcome not only for Australia, which is obviously our interest. Equally, we want to see Asia continue to grow, prosper and develop because we know that, as the Asian middle class continues to grow, prosper and develop, there are very significant opportunities for Australian business.

Over the past five, 10 and 15 years businesses in my electorate, such as Frosty Boy and Teys abattoirs, have made inroads into Asia. They're doing stuff in Japan, South Korea, Vietnam, China and other countries. Companies like that have put time and effort into developing those markets. I hope this agreement reinforces the investment they have made already in Asia and gives them confidence to build on it and grow.

I look at this agreement and the opportunities it provides. As the member for Fremantle has outlined, it doesn't really add a lot to what we've already got in a range of bilateral agreements, but, as I said, I believe it builds an additional level of confidence in those markets and across the region. As we move forward with this we need to encourage our local businesses to take advantage of the opportunities that agreements like this present.

Several years ago I was on the Joint Standing Committee on Foreign Affairs, Defence and Trade. We held an inquiry into how we encourage small- to medium-sized businesses to dip their toe into export markets. I talk to businesses in my electorate that are exporting. Traditionally they are larger businesses that have the resources, the capital and the connections, or the ability to build connections, across the region to enter these export markets. We need to work with our small- to medium-sized businesses and encourage them to build export capacity. With these agreements I would like to see some more discussion on how we generate that. I am not convinced how well that is considered in the development of agreements. I hope that this agreement provides an opportunity for us to have a discussion with our small- to medium-sized businesses and encourage them to step into that export market and take advantage of the opportunities that arise because they're presently not in the market.

I agree with the member for Fremantle's comments that big businesses are already in that space and there probably isn't a huge amount of value to them in this agreement. But for our small- to medium-sized business there may well be opportunities that don't presently exist. I will spend some time exploring that in my discussions with my local business community, such as the plastic manufacturers that are developing new products for the agricultural sector. I have a plastics business that has developed a specific injector for avocado trees. That might be applicable to other crops grown across Asia. They are developing other products with biodegradable plastics.

We've now seen some technology developed around waste recycling. BlockTexx have developed a special process to break down linen and towels into their constituent elements and resells those to be put back into the supply chain. We know that waste is a significant issue and that the recycling and reprocessing of waste is an immature industry, not just in Australia but across our region, so how do we use that opportunity to bring the technology we're developing here in Australia into those markets in Asia as a result of this agreement?

I commend the government for the work that it's done to get this agreement to completion and I recognise that it was started under a previous Labor government, back in 2012. But any of these agreements create opportunities for our business sector and give them the confidence to dip their toe into export markets where they previously hadn't done so. That's certainly part of the discussion I'm having with my business sector. It is an enormous market opportunity for us. Far too often I think our business community looks to the US or to Europe, and maybe, in reality, we were focused on China for far too long as a single market, but there are other opportunities right across the region.

As a result of this agreement, we've now got opportunities in Brunei, Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam, Laos, the People's Republic of China, Japan, New Zealand and the Republic of Korea. It is another piece in our trade puzzle that should encourage small- to medium-sized businesses to look to export as a way to grow their business. As a result of this, we also need to look at how we can assist small- to medium-sized businesses to access those markets and give them the opportunity to access the capital needed and the people with the skills and the ability to help them engage in these markets, but this is a great step in that direction. I commend the bills to the House.

Andrew Leigh (Fenner, Australian Labor Party, Shadow Assistant Minister for Treasury) Share this | Link to this | Hansard source

Debates over trade have a long history in this place. At the time of federation, New South Wales Premier George Reid, who ran the one free-trading state, said that, for his state, going into a federation with the question of tariffs to be decided later was like a reformed alcoholic setting up house with five drunkards and leaving the question of beverages to be decided by majority vote. In the early years of the federation, my side of parliament allowed members a free vote on questions of tariffs, but, by 1905, we had decided to join with Alfred Deakin's Protectionists, and Labor supported tariffs—as, indeed, did the conservatives.

Tariffs nearly doubled during the 1920s, the era of Smoot-Hawley, and by the late 1960s the Australian economy was, according to one analysis, 'the most protected economy in the advanced world'—what Black Jack McEwen called 'protection all-round', meaning that, if you wanted to sell a product in Australia, you either had to get an import licence or pay a tariff, which could often double the price of the product.

Then along came Gough Whitlam. In 1973, Whitlam cut tariffs across the board by 25 per cent. He did so for a number of reasons. He thought that high tariffs had left Australian companies uncompetitive and unable to compete with the world; he thought that tariffs hurt consumers; and he thought that they hurt workers in developing nations who found it hard to sell their products to Australia. Crucially, Bob Hawke, as President of the Australian Council of Trade Unions, put out a statement, cautiously welcoming the tariff cut and saying that protectionism had 'dulled the entrepreneurial spirit' of Australian manufacturers and that we could never pursue enmeshment with Asia behind high tariff walls.

It was the Hawke government and then the Keating government that continued to reduce Australian tariff barriers, largely not because we were doing so as part of a bilateral deal with another country but by recognising the wisdom of the great Cambridge economist Joan Robinson that it's worth taking the rocks out of your own harbours, even if other countries aren't taking the rocks out of their harbours.

By the early 1990s we'd reduced Australian tariffs by two-thirds from where they were in the 1960s. That benefited all Australians; it put thousands of dollars in the pockets of the typical Australian household. But the people who benefited the most were low-income Australians. We on this side of the House have long had the greatest scepticism about consumption taxes. We were very sceptical about the introduction of the GST and the effect it might have on inequality. It was Labor that pushed for carve-outs from the GST, and it's for the very same reason that Labor supported tariff cuts through the 1980s and 1990s—because tariffs are consumption taxes on imports, and they're regressive in the same way that the GST is regressive. As we've steadily brought down tariffs on clothes and cars, all Australian consumers have benefited. But as a share of income, the benefit has been greatest for low-income consumers.

For economists, trade is just another example of how comparative advantage works. Most of us don't fix our own cars, cut our own hair—well, unless we're in lockdown!—or make our own clothes. So, too, Australia—as a nation that has just 0.3 per cent of the world's population—benefits from focusing on what we do best and importing other goods that we need. Trade has made us more prosperous than we would otherwise be. It's also opened up huge consumption possibilities. One study of trade liberalisation in the United States found that the number of product varieties tripled from the 1970s to the 2000s. If you look through a large supermarket you might feel as though you're hit by the paradox of choice. But if you're a collector, if you love unusual cars or if you're a hobbyist, you've benefited from the reduction in trade barriers. It's not just about bringing down the average tariff—which we've done—but the way in which a lower average tariff brings more products into the market.

When we think about employment effects, we have to remember that for many workers their jobs are significantly enhanced by the use of equipment that has been imported. If you're a farmer, you benefit from imported fertiliser. If you're an office worker, you benefit from imported computers. If you're a factory worker, you benefit from imported factory machinery. If you're a truckie, you're certainly driving an imported truck, and that's making you much more productive. Indeed, many of our export-oriented firms rely on imported capital equipment.

Naturally, many have been concerned about the impact of trade on employment. But it is important to remember what's going on globally in manufacturing. Global employment in manufacturing has peaked as a share of the workforce. Indeed, as a share of the workforce, manufacturing peaked in the Philippines in 1992, in China in 1995, in Mexico in 2000, in Indonesia in 2001 and in India in 2012. So, even in the countries where manufacturing dominates the workforce, it is falling as a share of employment. The main reason for that can't be trade. If global manufacturing employment has peaked, it must be the case that this is a technology effect. That is why most of the studies that look at trade and technology say that about four-fifths of the job loss in manufacturing is delivered by trade. You only have to look at the factories of the future to see that many of them are far more capital intensive than factories of the past. There are many good jobs in manufacturing, and there are many great employment opportunities in manufacturing for Australia. But it is vital that when we look at what's happened in manufacturing employment we recognise that the chief impact on employment is coming through technology rather than trade.

Australians hold warm views about trade. We're much more positive about trade than people in most other advanced countries. Fifty-nine per cent of Americans say trade is bad when it comes to creating jobs in their economy; only 35 per cent of Australians think trade is bad for jobs. Sixty-seven per cent agree that international trade is good for their own standard of living and for the Australian economy; 61 per cent say it's good for Australian companies; and 62 per cent agree that Australia's trading future lies with Asia.

But it is increasingly true that trade negotiations are taking place on a plurilateral rather than a multilateral basis. If you look at the postwar achievements of the GATT and then its successor the, WTO, they struck eight global trading deals, in 1947, 1949, 1951, 1959, 1962, 1967, 1979 and 1994, and then it stopped. That was partly because global trade deals had brought down tariffs from 22 per cent to five per cent and partly because developing countries were better represented. So an all-in trade agreement became harder to achieve. Now we are in the world of plurilateral or bilateral deals. Australia has bilateral deals with all of the countries that are members of RCEP.

Those bilateral deals can be helpful, but it is important to remember that the more countries that are in a trade agreement the less likely it is to be trade diverting, the less likely it is to suffer from what Jagdish Bhagwati called 'the spaghetti bowl effect', and the more likely it is with a large trade agreement that you're able to get broad-based trade liberalisation rather than trade diversion. Trade diversion can be particularly harmful because many products now aren't made in one country; they are made in the world, and multinational supply chains tend to span borders. So these broad deals ensure that Australia can be part of those multilateral supply deals.

We need to make sure that we have better scrutiny of trade deals. There's nothing globophobic about opposing trade deals whose costs outweigh the benefits, whether that's costs in intellectual property and lengthening patent and copy right terms in a way that doesn't boost innovation, whether that's costs through investor-state dispute clauses that enable companies to sue governments and which are not part of RCEP, or whether that's costs in terms of migration agreements which don't serve the interests of Australian workers. Allowing the Productivity Commission to scrutinise trade deals would give Australians greater confidence that these deals were being struck in the interests of all Australians and greater confidence that they hadn't been captured by insiders.

I commend the work of my colleague the member for Brand and shadow minister for trade in working constructively with the labour movement and with the government to secure a number of key agreements. We have received assurances that RCEP and the enabling legislation won't remove Australia's capacity to protect local jobs through the regulation of temporary work; that they won't inhibit the government's ability to implement in full the recommendations of the royal commission into aged-care services; that they won't force the privatisation of public services; and that they won't undermine Medicare or the Pharmaceutical Benefits Scheme. And, as I mentioned, RCEP doesn't include investor-state dispute settlement provisions.

It is clearly in Australia's interest to support what will be the world's largest trading bloc. This RCEP agreement covers nearly a third of the world's population, nearly a third of global GDP. It will be bigger than the European Union and bigger than NAFTA. It covers 58 per cent of Australia's total two-way trade. It is an agreement with Australia's key trading partners. The members of RCEP are not overall democracies. In this sense, this is a different trade deal than we would be striking in our negotiations with the European Union, the United States and the United Kingdom. But it is worth ensuring that we liberalise trade at the same time.

This is a foundation agreement, one which has the potential to act as a platform for reducing trade barriers, but it will rely on the hard work of the Australian government. We saw the promises of APEC in the late 1990s to secure zero tariffs from developed countries by 2000 and from developing countries by 2020. Well, that promise didn't eventuate, so it's important that we have follow-through from the government on this trade agreement. Australia needs to ensure that we continue reducing those tariff barriers because so many Australian jobs are tied up with exporting industries—exporters that employ more Australians, that do more research and development, and that pay higher wages. It is in the interests of Australian workers and Australian consumers for us to continue down the path of trade liberalisation.

I finish with the words of the late senator Peter Cook, for whom I had the privilege to work in the late 1990s. He said:

… I am a strong supporter of free trade. Not "fair trade". Free trade. Naturally, free trade in itself will not solve the world's problems. Governments can and must play a strong role in ensuring that opportunities are fairly distributed to everyone. This is why I will always be a social democrat.

Like the late Senator Cook, I will always be a social democrat. That is why I believe in trade liberalisation and why I strongly support trade agreements like RCEP. But because I am a free trader I also believe in a strong social safety net, and only Labor can ensure the benefits of trade are fairly distributed and that no-one is left behind as we enjoy the gains in prosperity that can come from broad-based trade liberalisation and trading with the Asian region.

Damian Drum (Nicholls, National Party) Share this | Link to this | Hansard source

The Customs Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 and the Customs Tariff Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 give many members in the House the opportunity to rise to talk about the way that Australia has been able to forge an incredible reputation for itself as a trading nation and, as the previous member stated, how we have excised ourselves away from the protectionism that we had in place through the sixties and seventies. We opened up to the world and we certainly opened up to China and many other Asian countries. Many of those countries are represented in the RCEP agreement, and it's great that we continue to hone these agreements in ways that are going to give our exporters access to lower tariffs and favourable arrangements when they can prove that the goods that they are trading are, in fact, originating goods that have come solely from any of these 14 countries.

The work that we have done in recent years in China with the ChAFTA, Japan with the JAEPA, and Korea with the KAFTA has been with substantial agreements. They have continued over the years to give our exporters more and more favourable opportunities as the years go on. That's effectively how our trading reputation and trading situation have got to where we are at the moment. In agriculture we talk about a nation that can grow enough food for 75 million people, and this year is going to be a bumper year with our grain harvest, our dairy production and our fruit harvest. Many of these companies that exist within the Goulburn Valley have very strong markets overseas, and the need for us to have word-leading trade agreements is absolutely paramount for their success.

We have only recently signed the UK trade agreement, a brand-new agreement that we've been working on as Britain has been exiting itself from the European Union. Over the last four or five years we have been working extensively with the European Union to try and bring about a free trade agreement with that block of nations as well. As you can understand, that's taken an awful amount of time and negotiation. But if we are able to land a free trade agreement with the whole European Union I think it would certainly give Australia its third biggest trading block.

In the Goulburn Valley, within my electorate, we have companies such as Unilever, who have a base at Tatura. SPC is an iconic Shepparton preserving company—a factory. We have Campbell Soup, Freedom Foods, saputo, Parmalat, Bega, Kagome tomatoes. We have canola refineries making canola oil—sending that off overseas—based in Numurkah. We have Fonterra and Kyvalley Dairy. It is incredible how many food and dairy processing plants we have within the Goulburn Valley and nearly all of them are reliant upon strong and robust trade agreements.

A phrase that has come to the fore of trade negotiations and trade speak recently is 'a rules based order'. Unfortunately the reason why we talk so much about a rules based order is that we do in fact come up against some countries—one in particular—that tend to shy away from some of the rules that are in place. So we do in fact need to have these very strict and very tight rules that will give our exporters the confidence they need, and give them the comfort that they need, so that they can plan for their futures in a way that when fruit that hits the wharf in another country we know that it's going to be accepted. If the food and the processed food is of a high quality we expect it to be accepted. We expect the financials to be reciprocated. But we do have a range of issues with that. We just have to continually stress the importance of a rules based order when it comes to our trade. With these bills that we are dealing with here today we will see the honing down of this term, which is an RCEP originating good, and that's going to give our traders that extra incentive, as the preferential rates for the customs duties are bought into effect. That's going to be a significant saving for our exporters.

As the previous speaker also noted, we have been through an enormous change in the last 50 years in relation to trade and how it has significantly impacted our standard of living and the way we go about doing things here in Australia. Unfortunately in the last decade we have lost a motor vehicle industry, but prior to that we had an incredibly prosperous motor vehicle industry. We have also lost a whole range of other industries—like with our wool. Unfortunately we've got this situation in Australia where we produce about the 95 per cent of the world's fine wool, but we send 95 per cent of that fine wool over to China where it is processed and sent around the world as a processed yarn. We buy back very expensive Italian suits—with our own produce. These are some of the challenges that are now facing us. Are we able to go back in and put our toe back in the water in relation to some of the processing and some of the manufacturing jobs and industries that we have let go over the years? Are we able to go back and reinvigorate some of these manufacturing industries that are going to give us that opportunity to value-add and get a far better slice out of all of this food and fibre that we produce here in Australia?

I think that, if we can continue to hone our agreements that we have in place and build on new ones—there are many agreements that we have such as the comprehensive and progressive Trans-Pacific Partnership that we have with another 11 or 12 trading nations there. There are other countries looking to come in and join the CPTPP, and that will again give us greater access under different arrangements as well.

It's a very bright time for Australia. I want to commend the work that Minister Birmingham did when he had this portfolio, and now Minister Tehan takes over the mantle. It's a very exciting time for Australia, and we have this incredible opportunity as more and more countries look to get hold of our high-quality exports as these developing nations move into the middle class. I think Australia has much to benefit from if we embrace the trade opportunities that are available.

But, as I said earlier, it is critically important that we have the safety net of these rules based trading agreements. We simply cannot afford to get overexposed—which we probably already are—to some nations that then refuse to follow through with the original agreements that have been in place for a number of years. Look forward very much in the next short while to us finalising the deal with the European Union. Having those 26 or 27 countries come on board with that pact will also open up an incredible opportunity for many of our major industries. I think it will really add to our GDP but will also add to our quality of life if we are able to create a whole range of new markets of the substantial populations that exist throughout Europe.

I look forward to these bills going through the House. I look forward to the opportunity for us to continue to put new trade agreements in place, improve the ones that we already have and make sure that into the future there are going to be great opportunities for us both to import and, in this instance, effectively to create the export markets that we have done so well with to date. We look like we will be able to do that in the future even more so with improved arrangements such as we are talking about here in this bill.

Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

What a Liberal-Labor trickle-down love-in this whole debate has been. We've been treated to a whole evening of evidence-free neoliberal liturgy—'Trust us. Pass this free trade agreement and manna will fall from heaven. We can't tell you how much, even though we've got Treasury modelling coming out the wazoo. We can't actually point to a single dollar of benefit for you, but trust us. There is wonderful. Sign it away. This is all upsides and no downsides.' Liberal and Labor have even been competing for ownership of trickle-down economics. We even had one Labor MP get up and say, 'Not only was this idea; we are the Labor Party, and you should support us because we are for free trade, not fair trade.' We had the Labor Party getting up in here and saying: 'We are not for fair trade. That's why you should support this agreement.' What absolute rot.

It's no wonder this agreement is being pushed through with only a few speakers, because even the most moderate push on this house of cards makes it tumble down. This is not a free trade agreement. This is another one of those things that countries sign up to trade away sovereignty and give corporations greater rights to influence public services and how governments act. We already have free trade agreements with most of the countries that are covered by this legislation. That is why there's no benefit that can be pointed to from signing this—because the countries that are part of this are already, by and large, covered by free trade agreements.

What this agreement does is to give corporations in those countries additional rights to come in and interfere with what the Australian government might want to do for the Australian people, and it's critical to understand how that works. At the moment, governments in this country, because people demand it, do things like invest in the public sector—in child care, in aged care. We then put in place protections around those services, because people here expect those protections. Apart from in a few fields that the government has bothered to exempt, basically this legislation says, 'You're not allowed to increase protections in these fields anymore.' Corporations from overseas could attack you and sue you for taking steps to lift the welfare of your population. That's what this legislation does. We know this because the government has carved out exceptions for some areas. But there are others where it hasn't, and one of those is aged care.

During the royal commission we saw with crystal clarity what happens when we don't regulate the aged-care sector enough and we hand over the care of our older people to billionaires who are more interested in driving Maseratis and paying executive bonuses than they are in looking after people. We have seen that privatisation of aged care has been a mistake. We have seen that looking after our older people should be done for care and for the public good, not for profit, because those who try to do it for profit squeeze money out of it by denying people care. We saw what happened when people went into some of those aged-care institutions. It was so bad that we had a royal commission into it, and we were told, as part of that royal commission, that we had to regulate the sector better.

The Greens think we should end privatisation, the for-profit nature of the sector, and run it for the public good, but we've been told that we've got to regulate better. This legislation impinges on, and potentially removes, our right to do that. The government has been called out. Submission after submission to the inquiry of the Joint Standing Committee on Treaties said that we would be opening the door to unscrupulous, overseas based big corporations, who we can't regulate, coming in and owning parts of our aged-care sector, and that we would be powerless to lift standards in our aged-care sector. Even if overseas corporations aren't coming in, we may be prevented from doing it anyway.

And it's not just aged care; it's other areas as well. One of the areas that have not been preserved by the government is environmental services. What does that mean? We don't know, but it could mean that if we have a change of government—kick this mob out and put the Greens in balance of power to push the next government to start taxing the billionaires and investing in renewables—and start to put in place regulations to reduce emissions or say, 'We want to grow a publicly owned renewables sector,' overseas corporations could come in and say: 'No, you're not allowed to do that. When you signed up to this deal you forgot to carve out that particular thing and protect it. Sorry; your regulations are frozen in time.' Another way of saying it is: this deal will bind future parliaments and stop them improving regulations for the welfare of the people of this country.

This has happened time and time, because these agreements give big corporations a greater right to sue governments. They also weaken and carve out big holes in our labour laws. In this country it should be a basic principle that, no matter where you come from or what kind of visa you're on, local rates and conditions apply; you can't carve out exceptions to our labour laws. Local rates and conditions apply, and, if governments want to say that, in particular sectors, you have to advertise locally first, they should be able to do it. If you're coming to working here, local standards should apply as well. Everyone who comes in should meet the Australian standards.

These free trade agreements, which are getting the big rubber stamp and being frozen in time by this legislation, carve out huge loopholes in that—loopholes big enough to fly planeloads of exploited overseas workers through. That is terrible for those workers, because they're just doing the right thing by themselves and their family. They see an opportunity to come and work in Australia, and, in many respects, we should encourage that. But it should be on the basis of people coming in to fill jobs where we haven't been able to get people locally. Then, when they are here, they should get local wages and conditions and they should have pathways to permanent residency. Instead, what all the free trade agreements have done is say, 'No, we're going to carve out certain categories where labour market testing and the local standards you might expect of your electrician, for example, don't have to be applied to people who come through.' Instead of closing these loopholes, the Labor and Liberal parties are freezing them.

This agreement contains no labour chapter; it doesn't contain a chapter protecting and advancing labour rights. You might say, as someone on the Labor side did: 'Well, we tried to get one in. We couldn't do it. It would have been great if we had got it in, because we could have taken a step forward, but it's not like anything bad is going to happen because there's no labour chapter. At least we're not going backwards.' That's wrong. This is a deal with countries that we know use forced labour. We know that because, when it suits the government, they get up and talk about the Chinese government's oppression of the Uighurs and forced labour camps. They rattled the sabre around for Donald Trump when it suited them to do that and said, 'We've got to take that on,' but then they go and sign a deal with countries that engage in forced labour practices and say, 'The Australian government can't regulate to protect Australian businesses from competing against them.' In other words: this is going to be forcing Australian businesses to have to compete for jobs with countries that we know engage in forced labour practices and other forms of human rights abuses. So it's putting Australian corporations at a disadvantage, and it's tying future governments' hands so that they're not able to regulate it, because regulations get frozen in time.

The icing on the cake is that, at a time when there has been a military coup in Myanmar and there's a junta in charge—and the United States is saying, 'Hang on; we need to bring significant pressure, including economic pressure, to bear on this country'—the Australian government is saying, 'Let's go and sign a trade deal with Myanmar and the junta there.' No. That gives them the biggest endorsement you could imagine. When the Australian government says, 'We are going to sign up to that,' all of the words from the Liberal and Labor parties about protecting human rights vanish into nothing. It is clear that the dollar speaks the loudest—the big corporations who want to undermine our ability to regulate to protect our citizens and the people who live here. As to other countries which don't have the same standards that we and workers have been able to secure here, now this government and Labor are saying: 'Well, we don't believe in fair trade. We believe in free trade, and you're going to have to be forced to compete with them. If they've got lower standards than we do in Australia, we're sorry; it's just bad luck.' And any future government that wants to try to mend it by lifting the standards is going to find itself potentially at a huge disadvantage.

Given all the downsides, you would imagine that the government and Labor, who want this legislation rushed through, would be coming in here with a whole list of upsides and say, 'This industry over here is going to benefit by $3 billion, that one over there is going to benefit by $5 billion and that one over there is going to benefit by $6 billion. So, yeah, there are trade-offs but it's worth it.' You would imagine that they might say that. But there has been nothing—not a sausage. Why? It's because this is a facade—that's why. This is a façade that is designed to give corporations greater rights than governments and to put Australian companies and workers at a disadvantage.

You just need to look at the government's own words in the regulatory impact statement. You would imagine they would be trumpeting this in the documents that accompany it. But, no, we see:

Given the relative quality of Australia's existing FTAs with RCEP parties, including the CPTPP, we do not expect RCEP goods market access commitments to provide Australia with additional market access with our current FTA partners.

That's the national interest analysis—no additional market access. This is what the government are saying. They say, 'Well, it's not really going to help with tariffs.' As they say in the national interest analysis:

Under our existing FTAs, Australia will already have eliminated tariffs on imports from all RCEP parties by 1 April 2021.

So it's not going to help with tariffs. The national interest analysis goes on:

There are no costs in losses of tariff revenue for Australia associated with the entry into force of the RCEP as—under existing FTAs—Australia will have already eliminated tariffs on imports from all RCEP parties by 1 April 2021.

Not a single dollar of benefit under the government's own national interest analysis. But it's not surprising.

It's not just been the Greens, working groups and international groups who have called out this sham. It's not often that you get the Greens and the Productivity Commission on the same page. What the Productivity Commission has said is that we keep signing up, Liberal and Labor, to these so-called free trade agreements with spurious promises of benefit to the country but it's never quantified. Even the Productivity Commission has said, 'Before signing up to these things, let's have an analysis of whether it is actually going to benefit people at all.'

The government and Labor march in here and the best they can say is to read from the national interest analysis from the Department of Foreign Affairs and Trade, which says that there will be no additional market access and not one single dollar but there are plenty of downsides and exposure for Australian corporations and workers. When that is the best that the government can put on it, when the ability to regulate our aged-care sector is at risk and when we are giving corporations the right to attack future governments because we are freezing in time protections, we should not support this legislation. If Liberal and Labor want to engage in a competition to say, 'Oh, no; this is actually ours,' it tells you why we have seen so many protections eroded in this country over so many years.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

It's always good to follow on from the Australian Greens leader to put some rationality back into the debate. I'm always encouraged by the fact that many truck drivers who keep this nation moving listen in to parliament. What they would have heard just then was 15 minutes of passionate debate, yes, but debate that would have discouraged them, perhaps, from thinking that the nation is going well ahead with trade and discouraged them from doing the grand job that they do for and behalf of this nation in moving goods around. Many of those goods are going to port. Of course, Australia is a trading nation, and we need those goods to go to port, to get on ships and to go to other nations so they can also realise and reap in the benefits of our farmers, our resources and everything else that we put on those ships. I'm always encouraged by the feedback I get from our truck drivers. They've done a magnificent job through COVID-19. The National Transport Commission's code has enabled them to cross borders when others couldn't. It enabled them to continue to ferry goods right across this nation in a timely fashion, often to get vital medical equipment to where it needed to be, particularly in regional Australia and especially in remote areas.

As I said, Australia is a trading nation and it always has been. One in five Australian jobs is reliant on trade. We know that when the government and Labor get on board with something, it must be right, it must be good, and when the Greens are against it, that must give it the big tick of approval—it must, indeed. In regional areas, that number is closer to one in four jobs being reliant on trade. The Regional Comprehensive Economic Partnership, RCEP, agreement is a free trade agreement. Aren't we lucky we've got those free trade agreements and aren't we lucky we've got a Liberal-Nationals government which has been forthright and progressive in making sure that we get even more FTAs signed up, even more FTAs agreed upon? This RCEP agreement is complementing and building upon Australia's existing FTAs with 14 other Indo-Pacific countries. That is a good thing. It is a modern and comprehensive—as the name suggests—free trade agreement covering trade in goods and trade in services. That's important because sometimes, when we talk about trade, we don't think of or remember the many services that we engage in with other countries. The agreement also covers investment and economic and technical cooperation and it creates new rules around electronic commerce, intellectual property, government procurement, competition and small and medium sized enterprises. It has new rules for those areas of endeavour.

RCEP negotiations were launched in November 2012 between the Association of Southeast Asian Nations, ASEAN, and the RCEP agreement includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam and ASEAN's FTA partners: Australia, China, India, Japan, New Zealand and the Republic of Korea. Even without India, RCEP will still be the world's largest FTA, and that is significant. To give a market snapshot of RCEP, the gross domestic product in Australian dollars is $35.19 trillion covering 2.3 billion people. Indeed, trade with Australia in 2019 figures is $712.65 billion. They're big, big numbers, and we need these markets. We need these export opportunities. That's why the member for Wannon, now the trade minister, and others before him on this side of the House, and I'll give a compliment to those on the other side for what they did when they were in government, have endeavoured to do what's right in the national interest.

A report released on 31 October 2017, four years ago, suggested that trade liberalisation has given Australians higher incomes and more job opportunities. This Centre for International Economics report provided very real and convincing evidence about the benefits delivered by trade liberalisation in the period 1986 to 2016. The report found that average household income, bearing in mind that this report was published in 2017, at the time was $8,448 higher in 2016 than it would have been without trade liberalisation. The report found: one-fifth of the workforce, 2.2 million Australians, at the time, 2013-14, worked in trade related activities; 1.6 million worked in export related activities; and 671,000 worked in import related areas. Those figures are somewhat dated, and we know that what we've done in the meantime has only been good and has bolstered those figures and bolstered the average incomes of Australians, certainly the incomes of Australians in trade related enterprises. Real GDP was 5.4 per cent higher in 2016 than it would have been without trade liberalisation and investments were 11.7 per cent higher. Real wages were 7.4 per cent higher, which is significant. I know those opposite are always talking about real wages—7.4 per cent higher wages, and prices 3.4 per cent lower. We know that when there's a Liberal-National government on the treasury bench we're always going to be promoting trade. Those sorts of figures for real wages and job opportunities are always going to be higher with us in government. We know that.

The report underscored the importance of Australia's long-term commitment to free trade. Deputy Speaker Chester, you and I come from a party that has been very trade focused. 'Black Jack' McEwen was a brave pioneer to go to the Japanese market after World War II, when it was not popular to trade with that nation. Others since have followed that fine tradition. I know you and I are proud of that fact in our party, but we know, too, that regional Liberals are very much reliant on the trade, the opportunities and the market access that our policies promote. Any move back to high tariffs and trade barriers would see job losses—we know that—as well as cuts in household consumption and falling living standards, according to the 2017 report. That is as right today, in 2021, as it was then.

Since the CIE's modelling excludes services of investment and all liberalisation by trading partners, its estimates of the benefits of trade liberalisation are conservative. You can imagine what the figures put in that report four years ago are today. As I say, we've finalised eight FTAs since coming back into office. That is great. We have reached agreement in principle on a United Kingdom FTA, and we're pursuing an FTA with the European Union. That is encouraging for our farmers and for those truckies who are, at the current point in time, driving around those fantastic goods from the fine electorate of Gippsland, which punches well above its weight when it comes to output, and indeed from mine, in the Riverina and central west.

Australia has FTAs with eight of our top 10 trading partners. We have lifted our share of trade—and this is an important statistic—covered by FTAs from 26 per cent to 70 per cent, and we of course have plans to grow it even further. We delivered the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, a free trade agreement between Australia, Brunei, Vietnam and many other countries, including of course New Zealand, our great friends across the ditch. It's the gold-standard FTA in our region, and it came into force in Australia on 30 December 2018.

The RCEP, a modern, progressive partnership with 14 other nations in the Indo-Pacific, is going to cover all areas of a modern free trade agreement, including those difficult areas that are sometimes hard to negotiate between trade ministers. Aren't we lucky, as a nation, that we have the member for Wannon, a coalition colleague from Victoria, doing what he needs to do, travelling far and wide, to organise even more free trade agreements. Specifically, the proposed amendments that we're discussing and debating will provide rules, including product-specific rules, for determining whether imported goods are RCEP-originating goods. This is how importers prove that their goods are produced by, obtained from or include sufficient content from one or more of the RCEP parties. I know former senator John Williams did a lot of work in this regard. We have followed on that work in good faith to make sure that if a good says it's from somewhere, particularly our own nation, then it truly is from that particular nation. Indeed, the line of access from farm paddock to plate is significant, and it has helped our trade arrangements. Satisfying these rules qualifies the goods for a preferential rate of customs duty when imported into our nation. It requires Australian exporters and producers to keep sufficient records to enable them to prove their goods are RCEP-originating goods if they claim a preferential rate of customs duty when exporting their goods to one of the other 14 RCEP parties. That's significant. So it's two-way, in good faith, and this is an important part of the bill that we're debating tonight. It also creates a new schedule of preferential customs duty rates for goods that qualify as RCEP-originating goods. The new rules for determining origin status of goods and recordkeeping requirements for exporters and producers will be added to the Customs Act, which goes back to the year of Federation, 1901.

The new schedule of preferential customs duty rates will be added to the Customs Tariff Act 1995. The Customs Act 1901 will be amended to insert rules for determining whether imported goods are RCEP-originating goods. Satisfying these rules qualifies the goods for a preferential rate of customs duty when imported into Australia. Is that significant? Yes. Making sure that we keep faith with our trading partners is of course one thing that we always take very seriously. Making sure that we continue to provide the freshest, cleanest, best produce is something that our farmers, whether they're in Gippsland or in the Riverina—no matter where they are across this great nation—take very seriously. We are, in fact, very lucky to have the farmers who operate under world's best practice, who make sure that every available drop of water is accounted for, who make sure they're making the best use of every available hectare of arable land.

The main amendment to the Customs Tariff Act 1995 inserts that new schedule of preferential rates. It is part of what we're debating and putting through. When these particular schedules have cross-party alignment and support and the Greens are against them, you know that they are a good thing.

Why are these changes important? Why are they being made now? RCEP was signed by the then trade minister, Senator Simon Birmingham, back on 15 November 2020. We've been acting in good faith with the 14 nations since then to nail down the important side points, the important attributes of this legislation, of this agreement, to ensure that everybody's on the same page. We have cross-party support and we know it's in the national interest and it needs to be agreed to by legislation ensuring the agreement can enter into force as swiftly as possible, because putting this now makes sure we can extract the benefits sooner rather than later. It is in the interests of Australian businesses, consumers and exporters.

They've done it tough in recent times with COVID, with the lack of export opportunities because of the smaller number of planes coming into and leaving our country. That's why we have put in place those arrangements. Whether they are lobster fishers in north-west Western Australia—indeed, Geraldton—or produce the salmon from Tasmania, the sheepmeat from Victoria in your electorate, Mr Speaker, or right across this nation, we put in place assistance measures so that those products could be transported out of Australia. That gave great hope to exporters. The amendments in this bill before the House continue to build on the fine trading export opportunities that we have always put in place and will continue to put in place as Liberals and Nationals in government.

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Assistant Minister for the Republic) Share this | Link to this | Hansard source

This bill ratifies the Regional Comprehensive Economic Partnership treaty and brings into operation the world's largest free trade agreement—bigger than the European Union, bigger than the North American Free Trade Agreement. Twenty-nine per cent of the world's GDP is covered by this trade agreement, and it's within our region. I simply can't see how we can't be part of this. It's the biggest trading agreement in the world and it's right here within our region. Almost all of the nations of our region that we have an economic relationship with are part of this agreement. There are 15 countries, including ASEAN and including our biggest trading partner, China, with a clear set of rules for nations within the region regarding trade.

We've strengthened economic ties with the most dynamic region in the world, which will quickly develop into the world's largest middle class. That will bring investment opportunities. It will bring increasing trading opportunities, particularly around the delivery of services. When a population moves into the middle class, demand for services, particularly education services, aged-care services and financial and legal services, grows. When you talk about the Asia-Pacific region, one of the leading economies in the delivery of those services is Australia. This provides an opportunity for us to capitalise on that specialty and provide those services to the Asian region as the area grows and as more people come out of poverty and move into the middle classes.

It's traditionally been hard for Australia to break into many of those economies when it comes to services. We've had a great trading relationship with Asia when it comes to delivering commodities, particularly fossil fuel based commodities, but we haven't had success when it comes to providing services for many of those nations. That's because, in many respects, there are a lot of non-trade barriers that have been obstacles to Australian businesses in breaking into those markets. Many of them have seen it as too hard. Making the required changes to business models, getting to understand the different regulations and, in the past, unfortunately, having to know personalities to get things done have prohibited Australia from being successful in breaking into the delivery of services in many Asian markets. This trade agreement will help break down some of those barriers. RCEP countries include nine of Australia's top 15 trading partners, accounting for 58 per cent of Australia's two-way trade and 67 per cent of our exports. The benefits will come in terms of a reduction in non-tariff barriers to trade, such as quarantine and technical standards, which can make it all too hard for many Australian businesses to break into some of those markets.

The agreement provides the opportunity for parties to the agreement to bilaterally negotiate reductions in tariff barriers. Let's face it: although Australia has free trade agreements with most of the nations covered by RCEP, there are still further barriers to trade, in the form of tariffs, that can be reduced, particularly for Australia's agricultural exports into many of these markets. It provides investment protections for companies and businesses that want to trade and do business within Asia. But I reckon that the most important aspect of this agreement—one that will provide benefits, particularly for small and medium-sized enterprises in Australia—is that it sets a single set of rules for exporters to trade under, rather than the multiplicity of different rules and procedures under the various free trade agreements that Australia has. In that respect, it's very important in cutting red tape, particularly for small and medium-sized enterprises. If you're one of those businesses, you've got a product or service that businesses in Asia may be interested in and you're looking to break into that market, having a single set of rules under which you can apply to multiple nations is a big benefit. It's a big benefit for the creation of investment opportunities and jobs here in Australia.

The agreement also contains accountability measures for member states regarding trade. This will be important in combating and reducing corruption in trade. I think it's worth noting that many of the nations that will be party to this agreement are not democracies. In the past there have been issues with doing business in many of these nations, where corruption has unfortunately been ingrained as part of the culture and part of the process of doing business. In Australia, of course, we don't do business that way. There are laws and there are regulations and there are bodies in place to combat those sorts of activities. With accountability measures for trade between member states, the reduction that will come, hopefully, in corruption associated with doing business in some of these countries, particularly in the nondemocracies, will be a huge step for free trade within the region. It will also be a huge step for the development of a rules based trading system within our region. There has been much debate over recent times, particularly the last decade, about the strategic merits of ensuring a rules based trading system for countries operating in the Asia-Pacific region, particularly when you're talking about democracies trading with nondemocracies. This will be important in delivering a rules based trading system that all can work to, apply to and understand, and breaking down some of the barriers that exist.

Like with any free trade agreement, concerns have been put forward by Australians and organisations. I can understand the concern of Australian workers about their job protection and free trade agreements. The first issue I want to deal with is investor-state dispute settlement clauses, ISDSs. The Labor Party has as part of its platform opposition to these on a routine basis being put into free trade agreements. There's a good reason for that. In the past companies have tried to use ISDS clauses in free trade agreements to undermine Australian laws and regulations that were put in place for the good of the Australian people. The classic example of this is the challenge by Philip Morris to laws that were put in place by the Gillard government and then minister Nicola Roxon around plain packaging on cigarette labels in Australia. It was a health measure brought in to discourage Australians to take up smoking or to continue smoking. It was a health measure supported by the Australian population. It was challenged through arbitration under an investor-state dispute settlement clause in a free trade agreement.

Thankfully, Australia won the argument through that arbitration, but it cost the Australian taxpayer a lot of money to defend that action. The notion of a corporation being able to use a clause in a free trade agreement to undermine and challenge an Australian law that was decided democratically by this parliament and the people of Australia for the betterment of the Australian people is something that Labor does not support. Importantly, this free trade agreement does not contain ISDS clauses, so that should not be a problem.

It does not dilute the capacity of the Commonwealth or the states to regulate skilled temporary migration. This is important to the Labor Party, the union movement and workers. No-one likes to see labour brought into the country, particularly on conditions and wages that are lower than for domestic workers. It has been a challenge for Australia to regulate that in the past because typically when we do try to negotiate free trade agreements other nations like to provide opportunities for employment in Australia for their workers. It was a particular challenge with the China free trade agreement. Thankfully, due to Labor sticking to its guns, we were able to strengthen that agreement and get labour market testing as part of that. Nothing in this agreement will undermine the ability of the Commonwealth or the states to continue to regulate for labour market testing and for domestic or international skills assessments.

The final point I'd like to raise relates to Myanmar. I want to point out that I and Labor members condemn the human rights abuses that have occurred in Myanmar following the coup. We have condemned the Tatmadaw's actions. We have asked the government to review military cooperation with this particular group and with the junta. We have asked the government to undertake targeted sanctions. We have asked the government to be much stronger when it comes to defending democracy in Myanmar. We of course sympathise with the people of Myanmar and condemn the actions of the coup leaders.

But the best way to ensure that the concerns of Australians and the concerns of people in Myanmar are heard is through international dialogue. This particular free trade agreement provides an opportunity for Australia to be part of that regional architecture, to put those concerns and to ensure that, hopefully, they can be actioned. One way that potentially could occur with respect to Myanmar is for this free trade agreement to be done, for Myanmar to be admitted as a free trade party and then to be immediately suspended by the parties until they can work out the situation that has developed in Myanmar and return to democracy. That is an option that is on the table that the Australian government could consider.

All in all, this is of benefit to Australia and to Australian workers. I'm pleased that the Labor Party is supporting it. I commend it to the House.

Debate interrupted.