Kim Carr (Victoria, Australian Labor Party) Share this | Hansard source

The Reserve Bank has called for a stimulus package from this government to counter what many fear is a looming economic slowdown. Some have claimed that the Treasury Laws Amendment (Tax Relief So Working Australians Keep More Of Their Money) Bill 2019 will act as a stimulus. I think that is difficult to see as the bulk of these measures, particularly the great bulk of the costings in excess of $90 billion, will not come in for another six years. Little attention, however, has been paid to the causes of the slowdown in the global economy. I intend to go further by speaking about what has been missing from the nation's conversation for some time. I refer here to the trade war that's been raging between our principal strategic ally, the United States, and our principal trading partner, the People's Republic of China. There appears to be a kind of temporary truce, or it is said that there is, but the same thing was said in Argentina at the previous G20 meeting.

In fact, what we really know is that the President of the United States has launched his re-election campaign. What we see here is a circumstance where the United States party-political interests are being pursued, which is a very different thing from the national interests of Australia. We don't have any indication, given the conversations that followed the recent G20 meeting, that there's any permanent resolution of the major differences between Washington and Beijing. Rightly, this is a dispute that affects us much more sharply than the questions around these particular tax cuts, which we won't see the benefits of for six years.

We know that both President Trump and President Xi have made it clear that they don't feel bound by the rules of the international trading system; they don't see that the international trading system built up by Bretton Woods is applicable anymore. So, it's obviously the end of an era and the beginning of much less certainty about the future. It's strange that in a trade-dependent country like Australia there has been so little attention to or public debate about the consequence of that measure, and it's quite clear that we as a nation are deeply embroiled in that trade war.

When we look at the fine print of the conversations that have followed from Osaka, we see that the Australian farmers may well be the victim of so-called concessions that Americans have been seeking. We know from the comments made by various trade officials that the Chinese have agreed to increase imports of American agricultural products. We've also repeatedly heard that the Americans are upset about the tariff exemptions of our steel and aluminium. Because of the tariff exemptions that have been granted for those companies, it's a matter of some particular significance. We know that Australian companies are now being asked to moderate their sales to appease American anxieties. We know there are renewed threats to impose tariffs on Australian production.

We also know that Australian education exports to China are suffering. The Department of Home Affairs notified universities in April that the number of visa applications for Chinese students was no longer increasing. Vice-chancellors have on a number of occasions expressed the view to me that they hope the government knows what it's doing. Australian tourist figures point to that industry also being a casualty of the tensions. Chinese overseas travel intentions reported by the UBS Investment Bank show a sharp drop in the number of people planning to visit Australia. Official data shows that China's imports of Australian coking coal in May is down by 49.3 per cent on the previous month. In February eight ships carrying Australian thermal coal worth $120 million were kept offshore, off Chinese ports. We now know that it takes three times as long to get customs and unloading clearances for Australian coal as it did previously.

Many believe that this is retaliation for Australia's exclusion of the Chinese telecommunications company Huawei from supplying equipment for the 5G mobile network. Huawei is the world's No. 1 telecommunications supplier and No. 2 telephone manufacturer. It's become a potent symbol of everything that is at stake in this trade war—a symbol of China's pride and its advancing manufacturing capabilities, a symbol of US fears about emerging Chinese technological and economic dominance. Huawei has become an object of deep suspicion in some Western intelligence agencies—a suspicion that's led to the ban imposed by the Turnbull government in terms of the 5G network in this country.

However, President Trump has several times suggested that Huawei's access to US markets is in fact a security threat. The US commerce department has placed Huawei on a so-called enemy list of firms that US companies cannot do business with, without official permission—which of course amounts to a prohibition on the export of US technology to Huawei. This is a huge threat to Huawei's business, for no technology firm is entirely self-sufficient. The supply chain used by Huawei and its Western competitors is highly specialised but globally connected. The restrictions placed on Huawei threaten the business of those firms too, of course. President Trump said at the G20 that Huawei, however, would be able to resume dealing with some US companies but it would remain on the 'entities list'. President Trump also said that he indicated that he would be willing to make concessions on Huawei in pursuit of a—