Rex Patrick (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

My question is to the Minister representing the Minister for Trade, Tourism and Investment, Senator Cormann. It relates to the CPTPP. On 23 January 2018, 11 countries, including Australia, reached agreement on the final Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Studies based on favourable assumptions showed that the original TPP 12 would result in hardly any economic growth to Australia's GDP after 15 years. Noting there will be enabling legislation for the CPTPP, can the government confirm whether they will release the full cost-benefit analysis of the CPTPP so that the parliament and the public can share the same level of confidence as the government about the impact of the agreement? Will the government also initiate any independent cost-benefit analysis on the deal? Given the purported significance of this deal, why would the government fail to do both of those things?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

I thank Senator Patrick for that question. Firstly I reject the assertions made in relation to the economic impact of the Trans-Pacific Partnership Agreement. The Comprehensive and Progressive Agreement for the Trans-Pacific Partnership, which was a great success for both the Prime Minister and the trade minister, Steven Ciobo, who convinced others to proceed with this agreement with the remaining 11 countries, is part of our ambitious free trade agenda, which is all about helping Australian businesses be more successful and export more Australian products and services in key markets around the world. Guess what? Selling more products and services to other markets around the world helps make businesses more successful, helps them grow, and helps them hire more Australians and pay better wages.

The indicative modelling of the highly regarded Peterson Institute for International Economics found that the TPP-11 would boost Australia's national income by 0.5 per cent and boost exports by four per cent, which means more than $15 billion in additional income and more than $30 billion in additional exports. CPTPP countries are significant trading partners for Australia. The 10 other countries involved account for nearly one-quarter, or 23.6 per cent, of Australia's exports of goods and services, which was worth nearly $88 billion last financial year. That's why our government remained committed to this agreement, even when the US decided to walk away. As the CEO of the National Farmers' Federation, Tony Mahar, stated:

The CPTPP is a regional free trade agreement of unprecedented scope and ambition. It has great potential to drive job-creating growth across the Australian economy.

The Minerals Council of Australia said:

The regional trade agreement between 11 Asia-Pacific economies will boost Australian exports, contribute to growth, jobs and investment, and help ease cost of living pressures on Australian consumers.

And there is much more.

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Patrick, a supplementary question.

Rex Patrick (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

Even though Australia's plain packaging legislation for tobacco products was found under challenge to be constitutionally valid by our highest court, millions of dollars of taxpayer money was spent defending litigation because of ISDS provisions. Does the minister agree that ISDS poses a significant risk to Australia's legal sovereignty, as corporations have the potential to challenge rights to regulate in the public interest?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

No, I do not agree with that assertion. ISDS provisions are about protecting Australian companies in economies that don't have the same transparency and predictability as ours. They're about protecting Australian assets from being stolen and ensuring Australian businesses are given a fair go relative to the local overseas companies. We are aware of at least four companies that have used ISDS provisions to pursue their interests in overseas markets with legal systems less robust than ours. The coalition has also ensured the ISDS provisions it has negotiated include modern safeguards that appropriately balance the rights of investors with the rights of governments to regulate in the national interest.

Senator Ian Macdonald interjecting—

I would also point out, as Senator Macdonald just reminded me, that the cost benefit and all of the public interest benefits of this agreement will be reviewed and inquired into by the Joint Standing Committee on Treaties, which will no doubt also take on board the words of Business Council of Australia President Grant King:

This is a win for Australian workers and businesses.

The Winemakers' Federation of Australia stated— (Time expired)

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Patrick, a final supplementary question.

Rex Patrick (SA, Nick Xenophon Team) Share this | Link to this | Hansard source

While the ISDS mechanisms in the CPTPP contain safeguards to protect Australia's interest to regulate in the public interest, as you mentioned, the only clear exclusion of public interest regulation in the CPTPP is that governments can choose to exclude tobacco regulation. Can the minister please confirm whether this is the only exclusion or whether there are other exclusions relating to, for example, public education or social services?

Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Link to this | Hansard source

The full text of the TPP-11 agreement will be available on the day of signing, 8 March, and will contain detail relevant to the senator's question. As I said in my previous answer, the coalition ensured the ISDS provisions it has negotiated include modern safeguards that appropriately balance the rights of investors with the rights of governments to regulate in the national interest. I also refer Senator Patrick to the comments of the Winemakers Federation of Australia, which stated:

… overwhelmingly the agreement is a significant development for Australian wine exporters who will see trade tariffs drawn down or, in the case of Canada, removed immediately upon the agreement's ratification.

It is manifestly in Australia's national interest for Australia to be involved in this agreement, and the parliament will have proper opportunity to review the agreement before being asked to vote on it—in particular, of course, as Senator Macdonald kindly reminded me, through the Joint Standing Committee on Treaties.