Louise Pratt (WA, Australian Labor Party, Shadow Assistant Minister for Manufacturing) Share this | Link to this | Hansard source

Australia is a major regional economic player. In my own home state of Western Australia our iron ore provides the base material for steel mills in South-East and East Asia. Our food products are exported around the region and feed millions of people. Our education and training sector is world leading, and an Australian education is sought after right around the world. One in five workers, or more than two million working Australians, are employed in a trade related activity, working to create the exports that keep our nation strong. Indeed, many of those Australians are in Western Australia and an overwhelming value of exports comes from there.

As an open trading nation, Australia has been the beneficiary of the multilateral rules-based trade system that has operated for decades. But, as we know, the world is becoming an increasingly challenging place to do business in. The effectiveness of cornerstone institutions of global trade, like the World Trade Organization, are, concerningly, under threat. How we sell the things that we produce here into overseas markets is changing fast.

We need a government that thinks deeply about Australia's place in the world and how we navigate the next decade of change in a way that delivers better standards and conditions for Australian workers. We can't go about this alone. We need to work with like-minded nations to reform and modernise our regional economy and make sure that Australian working people are always central to any of the plans that we make.

The Regional Comprehensive Economic Partnership Agreement will be the world's second-most important trade agreement. I know people have expressed concerns about it, and the Labor Party have listened to those concerns. We take them very seriously and work through them. We simply can't be missing from the table in such an important trade agreement. The World Trade Organization will have greater scope and coverage over a larger chunk of the global economy than the current RCEP. The RCEP will create a dispute resolution and settlement process that will prevent economic or commercial disagreements from spiralling into conflict. If we look at the nature of the nation states that are part of this regional comprehensive partnership, having this infrastructure in place is particularly important. Therefore, it's particularly important that Australia is at the table.

We want an agreement that strengthens the rules based environment so that Australia, as a trading nation, can flourish within it. The RCEP will tie our economy even closer to near neighbours like Indonesia, Malaysia and New Zealand. We can be seen to advance the opportunities for export growth through our major partners like China, Japan and South Korea. RCEP countries already include nine of Australia's top 15 trading partners. This accounts for some 58 per cent of Australia's two-way trade and 67 per cent of our nation's exports. But enacting the RCEP should not mean that we sit on our hands like the Morrison government has done, like the Morrison government has believed we should do as a nation. No single trade agreement, regardless of its scope, will shore up our economic future as a nation. The COVID pandemic has shown the critical role that regional supply chains have in ensuring products make the timely transition from raw material to consumers hands right around the region, consumer products that Australia needs.

Australia must take advantage of the growth opportunities that the RCEP provides to diversify our trade both in markets and in products. Our small and medium enterprises are responsible for only 14 per cent of Australia's exports, and we can and should grow this as a nation. To put this in context, the G7 country average is 25 per cent and the European Union is 35 per cent of their exports coming from small to medium enterprises. So we must see this trade deal as an opportunity to boost the capability of Australia's SMEs and to grow Australia's manufacturing sector. It's interesting and important to see that the Australian Food and Grocery Council very strongly sees a future in growing exports to the region of their currently domestically focused household goods.

We need to continue doing this by harnessing the unique opportunities we enjoy to become also a green energy superpower. We have the skills and capacity to become a renewable energy powerhouse, and a strong Australian manufacturing sector can deliver world-class products. We want to incorporate and innovate cutting-edge technologies and provide good, secure jobs that Australian workers need. This is the future 'Made in Australia' that we deserve as a country. But it's not one that we're going to get under this failed Morrison government, as we've seen. This is a government that can't even come to a decision in its own ranks on the future of energy generation in Australia.

Just reflect for a moment, we have a coalition government that is so divided, so riven with internal conflict, that they cannot even come to a decision on how they plan to keep working Australians' lights on into the future and the energy supply we need to manufacture our own goods for Australia and the region, let alone our households. This has massive implications for Australian businesses, workers and the future of Australian exports.

As we've seen, the Grattan Institute has told this chamber in submissions to the upcoming inquiry into the Australian manufacturing industry that the case for gas led manufacturing recovery isn't viable any longer. As we've seen, the source of low-cost gas in the eastern states is now very much depleted. The remaining gas is too high a cost to meet our manufacturing needs. So this gas led recovery can employ only a small number of people. If we're a nation that seeks to set ambitious climate and emissions reductions goals, then we need an energy future plan now—a plan to meet our targets and a plan to transform our economy. Making these plans now is much cheaper than waiting to the death knell of climate change in 2050, and we've wasted many, many years already.

We cannot continue to see the burning of gas and coal to generate the electricity Australian industry needs. Why? Because it's, frankly, more expensive than the other energy sources that we have at our disposal. We need a government that wants to use its spending power to invest in renewables technology designed and manufactured right here at home, to diversify and grow our export markets overseas through the rules based trading system that the RCEP maintains. This is not an opportunity we can let slip past.

A report jointly released in recent weeks by the Australian Conservation Foundation, the Australian Business Council, the WWF and the ACTU suggests that investment in clean exports could generate some $89 billion in new trade by 2040. That is more than we currently export in fossil fuels. We need a future made in Australia that we can export to the world, and so it's alarming when we see this trade deal that we're debating before the parliament. Yes, we can make a step forward here, and yet we are held back by the internal division of this government when it comes to our energy future. Those opposite are too busy having their ideological brawls in their party room to put a step forward to govern in the interest of Australian businesses and workers.

The World Bank says India needs to create 8.1 million jobs per year just to maintain its current employment rate. It is critical, therefore, to see Australia's energy supply is accessible to those nations. We know that renewables will be important to their energy future, and a lack of green energy supply, let alone coal, will constrain India's growth. We can become a world leader and a significant regional player in the export of materials and technologies needed to transition economies around the world to greener and more sustainable energy generation. This includes a decarbonising China and a quickly industrialising India.

The trade deal before us strengthens this opportunity, but the Morrison government will leave us asleep at the wheel in terms of being able to make the most of these contributions. We've previously raised concerns over the Morrison government's refusal to release the final treaty text to allow it to be scrutinised before the agreement was signed. We have a government that is notorious for secrecy and notorious for a lack of transparency, and this is very damaging for how Australians view their leaders. Is it any wonder that we have parts of the Australian population captured by conspiracy theories when this government does nothing to promote transparency in government?

But it also means Australian industry cannot plan ahead. Greater transparency and the development of trade agreements is critical to building community support for fair and open trade. Labor have been in consultation with the union movement, civil society and economics groups throughout the negotiation and eventual signing of this agreement. And we do this because we believe in allowing people to plan ahead. A future Albanese Labor government would use the opportunity the RCEP gives us to work in collaboration with Australian business and workers to grow the Australian manufacturing industry.

Now is the time to invest in Australian manufacturing. We might not get a chance as good as this again. Enacting the RCEP should function as an opportunity to take action and diversify what we export. Let's not lose this opportunity that we have in this agreement because of a failed climate change agenda here within Australia. This failed government needs to stop sitting on its hands, quit fighting amongst itself and start getting on with growing Australian manufacturing.

Rex Patrick (SA, Independent) Share this | Link to this | Hansard source

I rise to speak on the Customs Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 and the Customs Tariff Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021. I've been listening to the debate in the chamber and listening to the comments of the Greens, One Nation, Labor and of course the government. But interestingly, particularly on the Labor side—and I'll accuse One Nation of this as well—they are standing up and pointing out all of the things that they believe in, yet this particular agreement presents risks to all of those things. So they're hoping there's an upside in trade without really examining the risks to the very principles that the Labor Party purport to support and, indeed, One Nation purport to support.

I always listen to Senator Roberts when he says we have to base our considerations on data and facts. I agree with that principle. But this is a situation where there is no evidence of an economic benefit that flows from entering into this agreement. There is no independent economic assessment of the cost and benefit of RCEP, and there is no additional market access for Australian exporters. Don't we have a responsibility to look at a piece of legislation and ask: what are the pros and what are the cons? Here we have no view as to the economic benefits. Part of the problem here is, as Senator Pratt mentioned, whenever these deals get negotiated it is done in secret. There is no opportunity to see the text of them such that people can then do a proper analysis and present the parliament with information such that it can make an informed decision. None of that is there. Time and time again, I see the Labor Party stand up and say, 'We want transparency.' But the government just keeps going off and doing what it does, which is to negotiate these things in secret.

If we go back and look at the better advice bill, it was a bill that was recently in play where the government presented it to the parliament without any of the regulations attached to it. Do you know what? The Senate stood up. The Labor Party, the Greens and One Nation stood up and said: 'Do you know what? We're not going to let this bill pass until such time as we get to see all the data.' The government then pulled the bill. They saw the second reading debate. They worked out they did not have the numbers. They pulled the bill and had to go away and then table the amendments. That is what happens when the Senate stand up and says, 'We are not going to do things without proper analysis.' Yet that's exactly what we are doing here—there is no analysis that suggests that this gives us an economic benefit.

Interestingly, this bill involves China. China has, in recent times, been acting in a manner that is quite harmful to Australia. We can see the wine industry suffering. I hope Senator Farrell chips in and gives me a 'Hear, hear!' in relation to this. The wine industry is suffering as a result of changes that have occurred, with China acting outside of our trade agreement. The problem that arises here is that we are effectively entering into further agreements with a country we know doesn't comply. So what happens is they do not comply but we are the model party to these agreements. So, for the next two or three years, Australian agriculture will suffer because we'll have one party not playing the right way and then we'll have Australia being a model party in the way it conducts its international affairs. That's the danger we have in further signing up to an agreement that may well benefit a country that is acting in a manner that is harmful to us.

There is also the issue of human rights. Some of the countries involved in this are in breach of human rights. The Labor Party stood up and affirmed its support for stopping slave labour, for stopping the import of goods that come from slave labour. The Senate passed a bill in support of that, despite the government's opposing it. Yet here we are entering into an arrangement with some of the countries engaging in slave labour, and it doesn't address that problem. It's money before human rights, it would appear, not that we even know that there's money involved in this for us. Typically, we've negotiated these sorts of agreements and we haven't done well. That's what typically happens. We're signing up to an agreement with Myanmar, which is currently governed by a military junta that took power in an illegal coup in February this year. Seriously? That's what we're doing. We're engaging in commerce and engaging in negotiations with an illegitimate junta. I don't understand some of these things.

This agreement may well restrict local industry development by, basically, entrenching the rules that discourage government assistance to local industries. We already have a perverse situation—I see this on the other side of the chamber all the time—where those opposite talk about competitive advantage, which is an economic theory that says that if you can do it more cheaply somewhere else that's where you should do it. What happens is that the government says: 'You've got to have leave loading. You've got to have long-service leave. You've got to have minimum wages. You've got to have occupational health and safety. You've got to have environmental standards. You've got to build your product according to an Australian standard.' I don't object to any of those things, but we've got to recognise that they impose a cost on Australian businesses. We then look at the price of goods and say, 'Hang on, it's cheaper to buy that from Vietnam or Burma or somewhere', where they don't have any of those rules. I don't mind the theory of competitive advantage, provided that it is provided in a practical manner and not in a completely theoretical manner. This bill entrenches some of those principles. Every time I stand up and say I'd like to see the government supporting Australian industry by way of procurement, I get confronted with: 'I'm sorry, Senator, that's going to breach trade agreements.' Yet we sign up to these things. It doesn't make sense, particularly in circumstances where there is shown to be no economic benefit, just a downside risk. We shouldn't be doing that. The Labor Party say that they support manufacturing, but they're now going to help sign up to an agreement that fetters the ability of the government to assist in rebuilding the very lows of manufacturing that we have.

I have talked on many occasions in the chamber about the need for us to stop exporting our rock—stop exporting just iron ore, stop exporting just our lithium and instead build and export steel and build and export lithium-ion batteries. There is much greater value in that, and it generates intellectual property, generates jobs and generates value. Do that here. But every time we try and do that here we get confronted with competitive advantage. We say someone else can do it more cheaply. That's because we impose all of these costs upon Australian industry. This treaty would embed that even further. That's why, when it comes down to it, I can't support this. I'm all for fair trade, but it has to be fair, and it has proven not to be fair in many, many circumstances. It risks increasing the number of temporary workers coming to Australia who might be exploited. I thought the Labor Party cared about workers being exploited.

This can assist in that regard. It only takes the Labor Party to stand up once on a treaty and, suddenly, DFAT will have to change its conduct, just as Treasury had to change its conduct in terms of presenting bills to this chamber without the regulations attached. It just takes standing up once or twice and saying no. Then DFAT will have to go back and negotiate these treaties in a different way, knowing the views of this chamber—knowing the views of the representatives of the Australian public.

There are other concerns I have in relation to this. This does not invoke ISDS, but that will be reviewed in a couple of years time. For people who don't understand what ISDS is, it's a schema whereby if the Australian government changes regulations or does something in the public interest that harms an international investor here in Australia, they can seek compensation for that. We saw that attempted in the case of tobacco advertising. There was a health measure introduced to basically make sure we didn't make cigarette packets attractive. The cigarette manufacturer took us to the High Court, lost in the High Court and then sought to set up a company in Hong Kong to exploit the ability to then invoke ISDS—investor-state dispute settlement. In that particular instance, we were quite fortunate that the tribunal ruled that the company had been set up, essentially, for the purposes of engaging in an ISDS. So the tribunal did not agree with the company's claims. But we were up for, potentially, billions of dollars. This is a situation where the taxpayer underwrites the risk for public companies. So companies can come here, make an investment and make an assumption that there will be no changes in the law or in public policy, because if there are they will invoke ISDS.

This is a risk that flows from this particular agreement, because there is a proposal to review this again. Again, that is likely to be done in secret and just presented as a fait accompli in a couple of years time. It's part of the Labor Party's platform to not support ISDS, but on several occasions they have wandered in here and voted for trade agreements that actually invoke ISDS. It is a bit of hypocrisy that is harmful to Australians, because, again, it sees the public underwriting the risk of companies.

I will conclude by saying that I support international trade. I recognise its benefits. But when something is presented to this parliament that is, in effect, an agreement that does very little except expose us to risk, you have to stand back and say: that is not in Australia's best interests. And that is what I will be saying when the bells ring.

Janet Rice (Victoria, Australian Greens) Share this | Link to this | Hansard source

There is no way that Australia should be signing this—absolutely no way. I was a member of the Joint Standing Committee on Treaties when we had the hearings on this. It was pretty clear that signing RCEP basically achieves nothing for us in terms of trade. No.1, they won't actually release any independent modelling that shows the details. But, basically, on the evidence presented to us, there were no claims that it would see a massive improvement in our trade. There was no modelling presented to say, 'Yes, this is going to be really good for Australia.' Basically, in terms of our relationships and trade relationships with the countries that were part of RCEP, it was all going to stay much the same. So, No. 1, the benefits are basically zero.

Then you've got to look at the costs, and the costs of signing RCEP are immense, because basically it means that Australia is signing up to trade arrangements that are unfair, that are environmentally really damaging and that have no labour rights provisions or human rights provisions. It is basically an incredibly old-fashioned last-century way of doing trade that does not even stand up for the standards in most trade agreements that are now being negotiated around the world.

I want to talk about four things that are fundamental problems with RCEP and reasons why Australia should be saying: 'No. Come on. Yes, fair trade's good, and we're happy to enter into fair trade agreements, but RCEP is not that.' The first is the total lack of transparency in the negotiations and in the whole process, basically. The second is the lack of human rights standards. The third is the lack of labour rights standards. The fourth is particularly important this week, the last week that we are in this parliament before our Prime Minister goes off to Glasgow, before this immense time of the world coming together to tackle our climate crisis. Yet here we are, signing up to a trade agreement that has no environmental standards. It hasn't even got an environmental chapter. It basically says climate doesn't matter.

First of all, I will talk about the lack of transparency in the negotiations and in the whole process. I think the easiest way to summarise that is to read from the submission that AFTINET, the Australian Fair Trade and Investment Network, made to the inquiry into RCEP. They said:

Australia's current procedure for negotiating and ratifying trade agreements is highly secretive and is not compliant with the basic democratic principles that underpin our domestic policy-making processes. Trade negotiations are conducted in secret and neither the Parliament nor the wider public had input into, or oversight over, the development of Australia's negotiation mandates. This was the case with the RCEP negotiations.

Negotiation texts were secret throughout the negotiations and the final text of the agreements was not made public until after the government made the decision to sign the agreement.

That in itself is a reason why we should be saying no. We should be renegotiating our entire trade negotiation practices so they do not conflict with basic democratic engagement in these processes, and you can do it. Other countries in the world have processes that allow for much more input from civil society and from their parliaments before the agreements are signed. So it's not as if we would be out on our own in insisting that this be the case.

The second area, as others have already noted in this debate—interestingly, although the Labor Party note this, it doesn't seem to influence how they vote—is the lack of labour rights standards. Again, they are not there. AFTINET say:

… trade agreements should include commitments by governments not to reduce labour rights, and to implement internationally-agreed labour rights which are defined by the International Labour Organisation (ILO). These should be enforced by the state-to-state disputes process of the agreement. These rights intersect with UN human rights obligations and include freedom of association, rights to collective bargaining, health and safety in the workplace, no forced labour, no child labour and no discrimination in the workplace …

Again, this is what trade agreements should include. RCEP does not. Why should we sign an agreement that does not include standards that are recognised as what should be in trade agreements?

The third area that I want to get to as the lack of human rights standards. I am absolutely stunned that we are signing a trade agreement with countries including Myanmar, China and the Philippines. And why? It achieves no increase in our trade. We are signing a trade agreement with Myanmar, at the same time as countries around the world are trying to work out what is the most pressure that they can put on the junta that took over Myanmar, in a brutal attack on people, democracy and human rights that has killed over a thousand people. There are people who are fleeing the Myanmar military forces. We know that the pressure is on—not that Australia has done anything about it—to apply sanctions. The EU, Canada, the US and the UK have all applied sanctions. We at least have said that we're not going to continue any military cooperation. We need to be having economic sanctions. All of this is necessary to try and do something about this brutal attack on democracy in Myanmar. That's what Australia should be doing in relation to Myanmar. But, no, we are signing a trade agreement with them. Why on earth would we sign a trade agreement with them? It can only be taken as us being complicit, as us giving tacit support to the Myanmar military's takeover and the junta in Myanmar. That in itself should be reason enough to say we're going to put this on hold, we're not signing a trade agreement with Myanmar as part of it. It is just something that is unacceptable for Australia to do.

We've got a free-trade agreement with China that they are blatantly breaching. There are bans on our goods going into China because they are unhappy with us because we are speaking out about some of their human rights abuses and their expansionism. So they've decided to block our exports into China. Given that behaviour by China at the moment, given that is so live, given that the Australia-China relationship is at such a low ebb at the moment, there are many other things that we should be doing with China to work out how we improve that relationship. But blatantly signing a trade agreement that doesn't require any of that negotiation is just ridiculous.

Thirdly, there are other countries—and I've been hearing speeches about this today: essentially, we're signing this trade agreement because ASEAN nations are the main nations that are involved; we want to keep sweet with ASEAN and it would be a snub to them if we didn't. We need to work out how to work with ASEAN without supporting brutal military totalitarian governments. Frankly, we are maintaining nice polite relationships with brutal totalitarian governments that are destroying the life of their citizens. We have heard so much on this in the parliament over the years—me in particular in my role as foreign affairs spokesperson over the last year. Frankly, we should not be kowtowing to them and basically saying, 'Okay, we'll sign trade agreements.' Yes, we need to work out how to work multilaterally, how we can work together where we have common interests; but signing free-trade agreements that do not require anything from them in terms of human right in particular, as well as labour rights and environmental rights, is not the way to go.

Fourthly, there is the lack of environmental rights standards. The other three areas I've talked about are pretty amazing and astounding, but the lack of environmental rights standards in the RCEP trade negotiations are just gobsmacking. We are in a climate crisis. We are in a time in humanity—possibly this year and certainly this decade—in terms of the future of humanity on this planet, where the climate crisis is the No. 1 thing that we need to tackle. Yet we are signing a trade agreement that doesn't even have an environmental chapter in it. It doesn't have any constraints in it, any measures in it, to require governments to take climate seriously and for that to impact on our trade relationships.

Of course, other countries in the world are very much linking climate and trade. It's quite right that they should do that. It is not just for a moral reason that we should only be trading with countries that are tackling the climate crisis appropriately, given it is a shared issue for all of us; it is also an economic issue. That's what the European Union are realising: if they are taking action to slash their carbon pollution by more than 50 per cent by 2030, why should other countries freeload on that? There will be costs, over the coming years, in making those huge cuts in our carbon pollution. The benefits are, of course, immense—it means humanity will actually have a future—but there are costs. So why shouldn't the European Union, which is taking those actions, say to other countries, 'If you're not taking those costs into account, if you're just letting polluters pollute for free, we're going to put some tariffs on you to account for that'?

We had our trade minister, just yesterday, noting that Australia is likely to be liable for carbon tariffs for goods that we try to export into the EU. And it is very appropriate that we should be. What that means is that, instead of having a price on carbon here in Australia that we could be reaping the benefits of, with the revenue raised supporting the transition to a zero carbon economy here in Australia, supporting programs for jobs for workers who need to transition out of the mining of coal, gas and oil—instead of that revenue being able to be allocated to that, it's going to go off to the European Union so that they can use it.

Basically these things are linked. We are in a climate crisis. There is action that needs to be taken. Multitudes of international mechanisms all around the world are being developed to work out how we can work together as a world to tackle climate. The COP26 conference in Glasgow that starts in 10 days time is obviously one of the prime mechanisms to get countries to up the level of their national contributions to slash our carbon pollution. Here we have a government that's doing nothing. It's going off to Glasgow with a completely empty basket. We're offering nothing in terms of increasing our ambition to tackle the climate crisis. At the same time, we are signing a trade agreement that says zero about carbon, zero about climate. It is just unthinkable. It shows that we have got it completely upside down when it comes to how we think about what it means to be a good global citizen, what it means to act in the global interest, what it means to act in our national interest. All of those three things are the same.

At the front and centre of everything we are doing we need to put human rights, labour rights, the extinction crisis, the huge pressures that the world's environment and biodiversity are under and the huge pressures that the world is under because of climate, because they are existential crises that the world is facing. With every global mechanism that we are part of, we should be saying, 'Is this going to help or is this going to hinder action on tackling the climate crisis?'

There are so many things we could be doing to help. We could be going to Glasgow and saying: 'Yes, Australia is going to play its part. We are going to slash our pollution, as the science says should happen—by 75 per cent by 2030 at least, and to zero carbon as quickly as possible thereafter.' We could be doing that. We could be signing up to the Powering Past Coal Alliance, which has got 41 countries who are committing to get out of coal by 2030. We could be signing up to the Global Methane Alliance. We could be taking any number of actions internationally. But instead what are we doing? We are signing a free trade agreement that basically is blind to all of these issues that the world is facing. The Australian Greens support fair trade. We support having good relationships with our neighbours. But we don't support the sorts of arrangements that are in the RCEP and absolutely should not be supported.

Don Farrell (SA, Australian Labor Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

Labor will be supporting the Customs Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021 and the Customs Tariff Amendment (Regional Comprehensive Economic Partnership Agreement Implementation) Bill 2021. The partnership, or RCEP, as it's known, was signed on 15 November, 2020, by 15 countries. It's a partnership that includes the members of ASEAN, the Association of Southeast Asian Nations—Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam—as well as five non-ASEAN nations: Australia, China, Japan, New Zealand and South Korea. These countries make up 29 per cent of the world's GDP and 30 per cent of the world's population. RCEP is, quite simply, the biggest trade agreement in history.

Negotiations for RCEP started in 2012 at the 21st ASEAN summit, in Cambodia. Prime Minister Julia Gillard and trade minister Craig Emerson commenced negotiations for RCEP on behalf of Australia. From the beginning, Labor has supported Australia being actively involved in the negotiations for this extraordinary example of regional trade infrastructure, which, very importantly, was led by the ASEAN nations. In a big deal for the world and a big deal for Australia, it includes nine of Australia's top 15 trading partners. It includes economies which account for a total of 58 per cent of Australia's total two-way trade and 67 per cent of our exports. Ratifying RCEP means 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. As Dr Jeffrey Wilson of the Perth USAsia Centre has argued:

On arrival, RCEP will be the world’s second most important trade agreement, behind only the World Trade Organization itself.

In essence, RCEP 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, minimum standards for 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 in areas such as quarantine and technical standards, by promoting compliance with the WTO rules and further improving cooperation and transparency

Finally, RCEP supports economic capacity building and, in particular, provides a dedicated chapter addressing the capability of small and medium enterprises in the region to benefit from the agreement. These protections and transparency provisions will provide greater certainty and confidence for 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 the existing FTAs. This cuts or simplifies a great deal of red tape for Australian SMEs and opens up opportunities for Australian exporters looking to utilise regional supply chains.

Regional supply or value chains are an essential component of the contemporary global economy; I know you know that, Madam Acting Deputy President Chandler. They are a cross-border industrial network for producing goods where countries specialise in different stages of reduction associated with a finished product. The Apple iPhone is a classic example of a product dependent on global value chains. The iPhone was designed in the United States, and iPhones are made from hundreds of individual components, all sourced from various specialised suppliers in 43 countries across six continents before final assembly in China for sale to world markets. RCEP as a trading bloc will render such value chains cheaper and easier to access for Australian companies.

While bilateral trade agreements are lucrative in terms of tariff reductions, they render value chains difficult due to the differences in rules, standards and procedures from country to country. As a multilateral trade agreement, RCEP is designed to streamline these rules, 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. In this context, RCEP will 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 a beneficiary of the multilateral rules based trading system that has operated for decades. Labor recognises that Australia's security and prosperity relies on our continued economic engagement in the world and integration with our region, including through trade and investment. One in five Australian workers is employed in a trade related activity—more than two million Australians. Labor knows that open trade will be the integral component of Australia's economic recovery from the COVID-19 pandemic. Labor acknowledges 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 appellate body stagnates and reform is stalled, regional agreements such as RCEP are integral to creating an even playing field between Australia and its trading partners around the world, but particularly in our vibrant region, from which future prosperity will be earned.

But Labor knows that the community is rightly sceptical about the Morrison-Joyce government's approach to economic change and trade agreements. We all know that the Liberals and the Nationals treat trade agreements like trophies to put on a shelf—ink the deal, get dressed up for the photo op but then no follow-up.

Labor's approach to international trade and trade agreements will be very different. To talk about the ALP platform, an Albanese Labor government will 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 of 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-skill, high-wage future for working Australians. Labor in government will set out an ambitious open-trade agenda 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-in-services economy.

The benefit of trade can and must be fairly shared 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 Australians benefit from the opportunities created by trade.

We know from our own history that, while the benefits of trade liberalisation are significant, they can come at a cost to sectors, workers and regions that are disadvantaged by structural change in our economy. In the short term in particular, adjustment support is needed for some sectors, workers and regional communities to ensure that they are lifted up and not left behind by economic change. An Albanese Labor government will not leave those workers and those communities behind. Our industry policy will include structural assistance to sectors of the economy, workers and regions which are impacted by any economic change. When multilateral trade negotiations such as the WTO are not making satisfactory progress, Labor will consider high-quality regional or bilateral trade agreements that are in Australia's national interest and that support the multilateral trading system.

Labor is 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, taking account of social and economic impact, 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, giving them economic independence and supporting human rights.

RCEP, as it stands, does not have an environmental chapter or a labour chapter. When Labor was in government, trade minister Craig Emerson sought to include these provisions. However, other RCEP members were not amendable to this. Prime Minister Julia Gillard, Minister Emerson and the Labor government at the time rightly decided to proceed with negotiations despite this setback to ensure Australia continued to be involved in the creation of regional trade architecture. Opting out and retreating to the sidelines is absolutely not an option and to do so would have set back Australia's relationship with ASEAN significantly.

The intent of RCEP is capacity building, bringing emerging economies in line with established economies like ours. This stands in contrast to other more ambitious agreements with developed economies which include labour chapters with enforceable international labour standards. However, RCEP includes measures with the ability to continue to develop provisions in these areas through successive reviews over time.

Labor in government will not enter into trade agreements that undermine the Australian government's capacity to govern in the interests of all Australians, including any provisions that: remove Australia's protection of local jobs through the regulation of temporary work; waive labour market testing; further limit the capacity of governments to procure goods and services only; require the privatisation or contestability of public services; undermine Medicare, the public health system or the pharmaceutical benefits system; undermine state or Commonwealth workplace laws or occupational licensing arrangements; or undermine laws that relate to antidumping. Labor's shadow minister for trade, the very professional Madeleine King, has sought clear advice from the minister for trade and investment, Mr Tehan, that RCEP broadly complies with these terms and that ratifying the agreement will not undermine the Australian government's capacity to govern in the interests of all Australians.

Claire Chandler (Tasmania, Liberal Party) Share this | Link to this | Hansard source

I have the minister next on my call sheet, but Senator Watt is seeking the call. I have been provided with advice from the clerk that the speakers' list is conventional. I did see Senator Watt and the minister jump to their feet almost simultaneously. Based on advice from the clerk, I will allow—Senator O'Farrell, are you making a point of order?

Don Farrell (SA, Australian Labor Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

Only that my name isn't O'Farrell.

Claire Chandler (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Apologies, Senator Farrell.

Don Farrell (SA, Australian Labor Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

I know there's been some controversy about New South Wales premiers in recent times and it's easy to confuse. But, respectfully, the point of order I was going to make was that we should apply the convention, and I understand that's what you're intending to do.

Claire Chandler (Tasmania, Liberal Party) Share this | Link to this | Hansard source

That is the advice I have received. Apologies for misusing your name. I will give the call to Senator Watt, but I will discuss this matter with the whips offline.

Murray Watt (Queensland, Australian Labor Party, Shadow Minister for Northern Australia) Share this | Link to this | Hansard source

Thank you, Madam Acting Deputy President. I appreciate you providing me with that opportunity. I might elaborate a little further on some of the points that my colleague Senator Farrell was just beginning to make, particularly in relation to matters of labour market testing. Labour market testing is always a contentious issue when it comes to free trade agreements. It's something that the Labor Party, the labour movement and I think the community, more broadly, do have serious concerns about whenever free trade agreements are being considered. Obviously the Labor Party's position is to strongly support the ability of local workers to obtain employment. We've got a very strong tradition of supporting that, and we do need to make sure that whatever free trade agreements are entered into by our country do respect the rights of local workers.

Senator Farrell had just begun to make the point that my colleague and friend the Shadow Minister for Trade, Ms King, has sought advice on this point from the minister for trade and investment, Mr Tehan. The advice that she was seeking was as to whether RCEP broadly complies with a range of considerations that Labor thought were important. Ms King also sought advice that ratifying this agreement would not undermine the Australian government's capacity to govern in the interests of all Australians. I'm pleased to confirm that, based on that advice that we've received, RCEP does not expand waivers of labour market testing for foreign workers. There are a range of stakeholders who have rightly queried the inclusion of an instrument in the Migration Act which mentions a change to our domestic labour market testing regime. We have clarified with the Department of Foreign Affairs and Trade that this is merely 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 that was 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 that Australia enters into.

Further, RCEP does not restrict Australia's domestic procurement arrangements at any level of government, it does not require the privatisation of any Australian public services, it does not undermine the Pharmaceutical Benefits Scheme, it does not undermine state or Commonwealth workplace laws or occupational licensing arrangements, it does not undermine Australia's anti-dumping regime, it does not include provisions that limit the right of the Commonwealth to regulate in the interests of public welfare or in relation to safe products, and it does not include investor state dispute settlement provisions, better known as ISDS provisions.

I particularly want to join with my Labor colleagues in commending the work of civil society and the trade union movement in their ongoing campaign, which has led to this government moving away from implementing ISDS provisions as a base for dispute settlement in all trade negotiations. That is something that has been an issue of serious contention within the community—the potential for these clauses to limit the application of Australian laws to overseas companies as a result of entering free trade agreements. The fact that we are seeing such ISDS provisions less and less in our international treaties is a testament to the tireless campaigning of the ACTU, the broader labour movement, AFTINET and others. Recent media reports that Clive Palmer is exploring the use of ISDS mechanisms to sue the Australian government reaffirm our opposition to them as a general provision of international trade deals. Having already forked out $1 million in legal fees because the Prime Minister supported Mr Palmer's attempt to sue Western Australia, Australian taxpayers don't want to be stung again by another vexatious suit from Mr Palmer.

An 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. We will include in any future bilateral, regional or multilateral trade agreements a labour chapter with enforceable, internationally recognised labour standards.

The Labor Party supports rigorous, independent economic analysis of trade agreements and, in government, will ensure that such analysis is conducted. Labor will also require that an independent economic assessment of the impact of each agreement be included in the report of the Joint Standing Committee on Treaties to the parliament. I want to put on record my appreciation to the members of JSCOT—including my good mate Senator Ayres; Mr Khalil, the member for Wills; and many others—for the good work that they've done on this trade agreement and many others.

The JSCOT report into treaty-making, report No. 193, which was tabled in August of 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.

Labor calls on the government to implement this recommendation.

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

Labor in 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. Where feasible, draft texts will also be released. Labor will legislate to ensure transparency in future trade agreements through the tabling of national interest assessments; consultation with industry, unions and community groups during negotiations; and the tabling of negotiation material in parliament where feasible—again, as recommended by JSCOT in its report into treaty-making. Labor will also commission an independent national interest assessment which includes a comprehensive social, economic and regional impact assessment of the negotiated treaty text, and we will mandate 10-year reviews of existing free trade agreements.

It's a very important principle to Labor that trade agreements not be used to undermine Australian working conditions and that foreign workers should be used only in situations where specific skill shortages are present and only for the period it takes to train and develop the capacity of an Australian to do the job.

It is disappointing that the underinvestment and the cuts made by this government to our training system—about $3 billion worth of cuts to TAFE alone—have at times caused skills shortages, which, of course, have been exacerbated recently by the closure of Australia's international borders. There are many employers who have been able to overcome the lack of skills in a particular area, whether that be a particular industry or a particular region, by bringing in foreign workers. Sometimes that has been to the detriment of Australia workers who haven't been able to obtain the training that is needed for such positions as a result of the cuts this government has made to skills and training. We're now paying the price. I know there are many businesses around my state of Queensland that are screaming for skilled workers at the moment, and that is a direct consequence of this government's to cuts to training.

Labor does not support the inclusion of provisions in trade agreements that confer on foreign businesses legal rights that are not available to domestic businesses, but while these are our principles, Labor is not yet in government and, as we know, international treaties are the remit of the executive arm of government.

It's worth our thinking about the Liberals and Nationals' record on trade agreements in the time they've been in office. Labor called for the final treaty text of RCEP to be publicly released before the agreement was signed so as to allow it to be scrutinised by the public, but the Morrison government refused in another example of their aversion to transparency. Labor has previously raised concerns over the Morrison government's refusal to commission independent economic modelling for the RCEP. This is nothing new from 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, George Christensen, and many others in its ranks free rein to spout inflammatory comments and spread misinformation about China. Under Prime Minister Scott 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. That is a result of this government's policies.

When trade diversification is of highest priority for this nation Prime Minister Scott Morrison is putting at risk our trade agreement with the European Union due to his diplomatic ineptitude on the recent nuclear submarines 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 remarkable capability that it has already exported, but more can be done. Australia has $1.3 trillion worth 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 health care into remote areas, which could be replicated in the complex and challenging geography of Indonesia and its many islands.

Labor is prepared to make that commitment and build that plan in conjunction with job-creating export industries. 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 agreement-signing ceremony. Labor knows that our relationships with our trading partners cannot be just set and forget, as they are under the Morrison-Joyce government. Signing a free trade agreement is not the end of the story. In 2019, the Morrison government committed to a range of measures to secure Labor's support for the Indonesian comprehensive economic partnership agreement—namely, compelling the JSCOT to review the way our country negotiates trade agreements. We are satisfied that the JSCOT treaty-making review has been completed and thank all members of the committee for their work in undertaking this process. We call on the government to implement as a matter of urgency the remainder of these commitments, in particular those related to worker exploitation.

Two other major issues that have been raised in connection with this agreement—

Sue Lines (WA, Deputy-President) Share this | Link to this | Hansard source

Thank you, Senator Watt. The time for this debate has concluded. You will be in continuation. We will now proceed to two-minute statements.