Transcripts → 2018


Sky News - AM Agenda

Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia


Date: Friday, 9 March 2018

US steel tariffs, TPP-11

KIERAN GILBERT: With me now the Finance Minister Mathias Cormann who has played a part in lobbying for exemptions. We will get to those specifically in a moment. But broadly your view on the events of the last couple of hours. There is an irony isn’t there this morning, on the day when the largest multilateral quality trade agreement signed in a decade, on the same day you have got the US President signing in tariffs via protectionism. 

MATHIAS CORMANN: Kieran, it is very significant that President Trump singled out Australia in his comments in the White House overnight. That is a direct result of the unwavering efforts and strong representations of our Prime Minister in making sure that we secure the right outcome for Australia, for Australian jobs and for the Australian steel and aluminium industry. We are very pleased that the President directly picked up on the case that was put to him by our Prime Minister and supported by his team. Specifically focussing on the fact that from a security point of view there is no stronger alliance than that between Australia and the US. That from an economic perspective we have a very important and very strong economic relationship. The US has a trade surplus in relation to Australia. We have a free trade agreement which has been going for fourteen years. Under that free trade agreement, US exporters into Australia do not pay any tariffs for imports into Australia. The case that the Prime Minister has been making is that our steel in particular goes into construction,predominantly, in the US. To impose a tariff on Australian exports of steel into the US would ultimately have negative consequences on jobs and the cost of construction in America. Picking up on the points that President Trump made in the White House overnight, these are precisely the arguments that the Prime Minister has put to him consistently now since they first discussed this at the G20 in Hamburg in July last year. It is a very significant development, a very significant positive development as a direct result of the efforts of our Prime Minister over the past nine months or so.

KIERAN GILBERT: Well you were with Mr Turnbull when you met with President Trump in the G20 at Hamburg and those assurances were given then. You would be reassured by not just the fact that he has mentioned Australia but that there is this fifteen day period now for Robert Lighthizer to negotiate. Are you confident given Lighthizer has decent links with our administration as well there too? 

MATHIAS CORMANN: We have very good friends in the Trump Administration across all levels. All of us, at our respective levels are supporting the Prime Minister’s efforts to get the right outcome for Australia. Our Foreign Minister Julie Bishop has been talking to her counterpart and also to Nikki Haley in New York. Myself, I have made representations to US Treasury Secretary Mnuchin, reminding him of the discussions that we had in Hamburg in July last year, again making the case. We are very pleased to hear President Trump acknowledge the arguments that we have been putting to the Trump Administration about the importance of our strategic alliance. We fought side by side with the US in battlefields around the world for a hundred years. The importance of our economic relationship. The importance for America and American customers themselves not to increase the cost of construction in the United States. It was an important meeting that the Prime Minister had with President Trump in Hamburg last year. He has been unwavering in his determination to get the right outcome. There is a bit further to go over the next fifteen days. But we are very encouraged that all of the statements that were made by President Trump overnight are very consistent with what we have been told since our meeting in Hamburg last year. 

KIERAN GILBERT: Australia is only one of three countries mentioned as well in the United States National Defense Authorization Act. So the fact that it is such a, well not just an ally, but a part of the military industrial base in the US, that can’t hurt. My understanding is that General Mattis, the Defense Secretary has been one of the strongest advocates of an exemption for Australia in the last couple of days. 

MATHIAS CORMANN: There is no stronger ally and more reliable ally for the US than Australia. General Mattis is very conscious and very aware of the incredible history of involvement that we have had together as friends and allies. We have other friends around the Cabinet table too. The US Treasury Secretary Mnuchin certainly is a very good friend of Australia. He is very aware of the importance of our economic relationship. President Trump himself has a very good relationship with our Prime Minister. Everything taken together and the fact that we were the only country singled out in his remarks from the White House in the context of the Cabinet meeting, we are very encouraged by all of that.  

KIERAN GILBERT: Do you also give credit to the business representatives in terms, well of Andrew Liveris from Dow Chemicals apparently has been very strong in his advocacy the last few days as well? 

MATHIAS CORMANN: Absolutely. This is a team effort. The Prime Minister has led the charge but we have been very ably supported across a whole wide range of Australians with a capacity to put our case in the US and help influence the right outcome. In the end that is what the Prime Minister and our team are focused on, getting the right outcome. We were very perturbed earlier in the week when the alternative view put forward by the alternative Prime Minister of Australia was to essentially escalate matters through retaliatory action. This is a time for a calm, strategic, determined effort to secure the right outcome for Australia, for Australian jobs, for the Australian steel and aluminium industry, not for union leader type posturing. 

KIERAN GILBERT: But the suggestion today by Mr Shorten, that he is going to announce today that Labor would pursue some tougher anti-dumping measures. They could still be relevant couldn’t they, Given that while we might be exempt over coming days, that China won’t be and others won’t be. So with their steel, where does it go, if it does not go to the United States? That is a risk. 

MATHIAS CORMANN: Bill Shorten as so often, his instinct is to recklessly just press ahead with a negative and excessive and retaliatory approach, which quite frankly would be quite counterproductive for Australia. We are an open trading economy. Our future economic prosperity and the prosperity of all Australians depends on our capacity to sell as many Australian products and services in key markets around the world as possible. Escalating a so-called trade war is not in our national interest. Bill Shorten would be much better advised to take a calmer, more strategic, more positive approach to Australia’s national interest, to Australia’s trade interests around the world. Today you have two key events, you have President Trump singling out Australia in the context of developments there, but you have also got Steven Ciobo, our Trade Minister, signing the Trans Pacific Partnership with 11 countries in our broader region. Bill Shorten would have given up on this. If we had listened to Bill Shorten, we would not have got this treaty signed today, which will boost Australian exports, which will boost Australian jobs, which will help lift Australian prosperity, which will help families around Australia to get ahead. This is really a very stark contrast between our approach, seeking to secure better outcomes, more jobs, higher wages and Bill Shorten’s approach, which would lead to less investment, less trade, fewer jobs, more unemployment and lower wages. 

KIERAN GILBERT: Your argument could be made just as well to Donald Trump though couldn’t it? Do you see that this message about free trade and a rules based trading order is important, not just in terms of its message to China, as many see it this TPP, but also to The United States in the hope that they might come back to the table down the track? 

MATHIAS CORMANN: We have sympathy for the view among many Americans about the unfairness in relation to their relationships in relation to some countries. We do not believe that Australia fits into that category for the reasons that I have outlined, not only are we a strong military ally and strategic partner, we are also a very strong economic partner. The trade relationship between Australia and the US is eminently fair from a US point of view. Australia is a great advocate for and a great beneficiary of an open trading system, a global open free markets, open trading system. That is something that we will continue to promote wherever we can. We will continue to try and secure the best possible outcomes for Australian exporting businesses, so we can create more jobs and deliver higher wages. 

KIERAN GILBERT: Well there certainly is an irony today when you have got that liberalisation happening in Chile and 11 nations signing, as we conclude where we began and then you have got that protectionism coming out of the White House, it is quite a momentous day in that sense Mathias Cormann. 

MATHIAS CORMANN: We will continue to promote our national interest in the best way we can wherever we need to. In relation to developments and decisions in the US, that is what the Prime Minister and that is what all of us have been seeking to do. Beyond that, we continue to promote the benefits of open markets and free trade wherever we can. The signing of the Trans Pacific Partnership agreement is a very important development. Indeed the US may well yet join back in at some point in the future. 

KIERAN GILBERT: Minister, I appreciate your time as always. Thank you very much.