Australian farmers praise resuscitated, historic TPP-11

Australian farmers praise resuscitated, historic TPP-11

Farm Online News

THE Trans-Pacific Partnership was essentially on life support when US President Donald Trump withdrew his country’s support for the trade deal in early 2017.


THE Trans-Pacific Partnership (TPP) was essentially on life support when US President Donald Trump withdrew his country’s support for the ground-breaking trade deal in early 2017.

But Australian farmers say the Comprehensive and Progressive Agreement for the TPP (TPP-11) - formally signed last week between the 11 remaining countries - delivers wide-ranging wins for agricultural exports with high value, due to broad tariff cuts and other trade liberalising measures.

National Farmers' Federation (NFF) President Fiona Simson said a year ago, after the US withdrew from the original TPP deal, it looked as if the day of re-signing the historic preferential trade agreement, which occurred in Chile last week, would never arrive.

But Ms Simson praised the Coalition government and Trade Minister Steve Ciobo for finishing off the job started by former minister Andrew Robb who signed the first agreement in 2015 which included the US, after initial negotiations and talks started in 2008.

“The TPP-11 offers preferential market access for dairy; cotton; barley; beef and live cattle; offal, processed meat and animal fats; sheepmeat; seafood; wheat and wine,” Ms Simson said.

“This means farmers have more markets to which to sell their products.

“It means investment on farm in jobs, in innovation and in efficiencies that will flow through to rural and regional economies.”

Under the TPP-11, first-time preferential access will be provided to the Mexican and Canadian markets for beef, dairy, grain, seafood, sugar and wine which have been effectively blocked for Australian producers, up until now and new access arrangements for exporting rice products into Japan.

As an example of the gains, Japan’s beef tariffs will be reduced to 9 per cent within 15 years and Canadian beef tariffs (currently 26.5pc) will be eliminated in 10 years as will Mexican beef tariffs, currently up to 25pc.

Ms Simson said like other preferential trade agreements, the TPP-11 would serve to even the playing field for Australian farmers on the world stage.

“And in this age of protectionism, the ultimate beneficiaries of this agreement will be the collective 495 million consumers who will enjoy a greater range of products, derived from high quality Australian food and fibre,” she said.

The trade deal involving Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, Japan, Vietnam, Mexico and Canada is now subject to a parliamentary review process, in order to be formally ratified, with an inquiry by Parliament’s Joint Standing Committee on Treaties.

Ms Simson said it was crucial all parties and politicians stood by Australia’s efforts to open new markets.

“The parliament now has the chance to scrutinise the terms of the agreement on its merits - we ask that they resist the temptation to politicise the review and ratification process,” she said.

The NFF joined with nine other industry groups like the Australian Food and Grocery Council and Minerals Council of Australia to release a policy brief this week setting out why Australia should support the TPP-11.

The document says the historic trade deal would boost the value of Australian exports by $30 billion and increase real GDP by $18b per year, on entry into force.

Extract from industry policy brief on TPP-11, urging its ratification.

Extract from industry policy brief on TPP-11, urging its ratification.

According to the policy document, the TPP-11 eliminates more than 98 per cent of tariffs in the TPP region and provides agricultural export wins in the following areas:

  • Beef tariffs reduced or phased out
  • Sugar market access improved
  • Rice tariffs phased out
  • Dairy preferential access for cheese, butter, milk powder
  • Wheat, barley, cereals tariffs phased out
  • Wine tariffs phased out, market access improved
  • Sheep and goat meat tariffs phased out
  • Horticulture tariffs phased out
  • Seafood tariffs phased out

It also says the trade deal represents $13 trillion in combined GDP for the 11 TPP nations or 13.5pc of the global economy.

“Australia is a trading nation – 2.7 million Australian jobs rely on trade and trade accounts for 40 per cent of our economy,” the policy document says.

“That means it is in Australia’s interests to resist protectionist pressures.

“Modelling shows that if countries around the world imposed extra tariffs of just 10pc, Australia’s economy would contract by 1.4pc, risking higher unemployment and lower incomes.

“This means supporting the TPP would be a strong statement in favour of international trade and open markets, which are critical for Australian prosperity and for our long-term strategic interests as a nation.”

Political reaction

Mr Ciobo warned against the growing trend of trade protectionism and said after the US withdrew, Australia “stayed the course” and played a leadership role to deliver the TPP-11 because it would “drive demand for Australian goods and services, which will help create new Australian jobs”.

“The world will be drinking more Australian wine, eating more Australian beef and using more Australian services thanks to the TPP-11,” he said.

“The wins the TPP-11 delivers stretch across the Australian economy, from agriculture to services and manufacturing and mining.

Federal Trade Minister Steve Ciobo singing the TPP-11 last week.

Federal Trade Minister Steve Ciobo singing the TPP-11 last week.

“The signing of the TPP-11 is a significant moment for open markets, free trade and the rules-based international system.

“It sends an important message to the world that prosperity is achieved through breaking down trade barriers, not building them.

“As parts of the world flirt with protectionism this is a timely reminder there is a different and better way to drive economic growth rather than stifle it.”

Mr Ciobo said the agreement allowed for countries to join if they are able to meet its high standards and he welcome new members “as that means more export opportunities for Aussie businesses.”

But the Australian Greens however through trade spokesperson Senator Sarah Hanson-Young said her party would “fight tooth and nail to defeat this dodgy trade deal”.

She said the Turnbull government would “sign any agreement that was put in front of them if it had the words ‘free trade’ on the cover page”.

“This deal doesn’t come into effect in Australia without enabling legislation passing the parliament and the Senate must shine a light on what exactly the government is hitching its wagon to,” she said.

“We’re going to throw all we can at this deal to expose the dangers it poses to Australia, and to defeat it in the parliament.

“The Greens will always fight against any deals that put corporations ahead of community and call on Labor and the crossbench to support a Senate inquiry into the TPP when parliament resumes.”

Shadow Trade Minister Jason Clare said if the TPP-11 was “good for jobs and if it’s good for Australia then of course we’ll sign up to it”.

“There’s some obvious benefits there in terms of extra market access for our farmers,” he said.

“Penny Wong has made the point there’s strategic benefits in an agreement like this as well, by creating road rules for trade for the whole region.

“I note also that some of the more controversial elements of the original TPP have been taken out, that deal with pharmaceuticals and copyright.

“There’s still some parts of it that we wouldn’t have done the same way.

“The government has waived Labour Market Testing for six different countries.

“I think most Australians believe that we shouldn’t bring in foreign workers to Australia before we first check and see if there’s an Aussie that can do the job.

“The government’s got rid of that. I think that’s a mistake - it’s also a broken promise - it’s the sort of thing we think we can fix in government.”

Mr Clare said the TPP-11 would go to a parliamentary committee which would provide recommendations to the parliament and would then be formally considered by Labor’s Shadow Cabinet and Caucus.

Asked what he was thinking at the moment, Mr Clare said “look at Labor’s record - we’re a party of free and fair trade”.

“No party – Labor or Liberal – has opposed a trade agreement over the last 20 years - but it doesn’t mean this agreement’s perfect and I think there are things that we would need to fix in government,” he said.

Prime Minister Malcolm Turnbull said Australia pushed through with the new TPP-11, despite the US withdrawal, due to its capacity to deliver broad economic benefits in areas like agriculture.

“You know when the TPP looked as though it wasn't going to happen….because Donald Trump became (US President) and said he wasn't going to sign up to it,” he said.

“Well that was his right, he made that a commitment during the (election) campaign; it would hardly have been a surprise.

“We resolved that we were not going to let the Trans-Pacific Partnership fail because it was too good a deal for Australia, too good an opportunity.

“And there were many knockers and people who wanted to give up - none more so than Bill Shorten.

“Bill Shorten would give up on trade if he were prime minister.

“He mocked me for continuing with the TPP, he said I was on a vanity trip, I was delusional, I was wasting my time.

“Well it’s now been signed, with the support of Japan and all the other countries in the TPP-11.

“We now have that new trade agreement signed and it means more opportunities, more exports and more jobs.”

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