Senator the Hon. Mathias Cormann
Minister for Finance
Special Minister of State
Leader of the Government in the Senate
Senator for Western Australia
Date: Thursday, 27 June 2019
MATHIAS CORMANN: This summit this weekend is a great opportunity to explore ways to ease pressure on our global trading system. It is a great opportunity to reinforce the importance of free trade and open engagement and to pursue ways, as I say, to ease pressure on our global trading system. The Prime Minister will be working closely with President Trump and Prime Minister Abe, as the host of this summit here in Osaka to pursue all of these issues and we have also have a particular priority, which focuses on ensuring that social media companies are required to keep relevant violent and extremist content off their sites.
It is an important period to be here and we look forward to a productive and constructive summit.
QUESTION: President Trump and Xi will be meeting on Saturday morning. What is your intel on the likelihood of a breakthrough, what do you think will be the outcome of that meeting?
MATHIAS CORMANN: We can only speak for ourselves. We let the US and China talk for themselves. What we will be promoting is a negotiated outcome, which is consistent with WTO rules and which does not unfairly discriminate against any other parties. We want to see the continued promotion of free trade and open markets as the proven way to deliver increased living standards and peace and stability around the world.
QUESTION: What would the message be from the Prime Minister to the President, Senator, on the implications of this for Australia’s economy?
MATHIAS CORMANN: The Australian economy is an open trading economy. What happens in the world matters to us. That is the same for most other economies around the world. A continued trade war between the US and China is not in anybody’s interest. It is not the interest of the US, it is not in the interest of China, it is not in the interest of Australia, it is not in anyone’s interest. From our point of view, we would like to see a negotiated outcome. We recognise that there is a need for reform to the WTO framework. We have supported that at the most recent G20 Leaders Summit back in Buenos Aires in 2018. We believe it is a matter of continuing to take this forward, but ultimately we very much want to see a resolution of tensions in a way that is consistent with WTO rules.
QUESTION: Will the Prime Minister be meeting with President Xi Jinping and what is the message there because he seemed to suggest that Australia does have concerns about the way that China works outside the WTO rules?
MATHIAS CORMANN: The world in 2019 is very different compared to what it was like when the WTO was first set up. It is important to modernising its framework in the same way as you have to modernise all sorts of other frameworks to make sure they keep pace with the times. I think that is broadly recognised. I think that is recognised by the US and by China and that is certainly something that Australia supports.
QUESTION: Will you and the Prime Minister be frank tonight and blunt in your message in terms of the need to get a deal?
MATHIAS CORMANN: We are always frank, open and constructive. We look forward to a positive and constructive engagement with the President and his team tonight. We certainly will be putting forward the Australian perspective, which is that we believe that a commitment to free trade is important. A commitment to open engagement is important. A commitment to find a negotiated resolution, which is consistent with a rules based system is important and it is important to ensure that the negotiated outcome between the US and China does not unfairly disadvantage other countries like Australia.
QUESTION: This trade dispute is already taking its toll on growth in Australia, which is faltering. If an agreement cannot be struck here this weekend, is there enough fiscal firepower left in the Australian Government to starve off further slowing in the economy?
MATHIAS CORMANN: Firstly, the Budget that we delivered on the 2nd of April was put together in the context of our assessment of what was happening in the world. Global trade tensions and in particular trade tensions between the US and China and their impact on the Australian economy were very much factored in to the policy settings reflected in our Budget. Our Budget is a pro-growth Budget. It is a Budget which includes our next phase of income tax relief for all working Australians, prioritising low and middle income earners before reforming the tax system by taking the bracket creep monkey off all Australian workers. We call on all parties in the Parliament to demonstrate goodwill and facilitate speedy passage of that very important piece of reform legislation. The Government will always continue to monitor and assess the impact of global developments on our domestic economy and we will make judgements accordingly…interrupted
QUESTION: Which might mean doing more.
MATHIAS CORMANN: We have a Budget once a year and we have a half-yearly Budget update six months later. So by the end of the year, before Christmas, there will be a half-yearly Budget update. As it always does, it will be an update both in terms of our assessment of economic parameters, but also an update in terms of policy decisions taken since the Budget.
QUESTION: In terms of optics how significant is it that the first meeting of significance that President Trump is going to be having at the G20 is with the Prime Minister of Australia?
MATHIAS CORMANN: What it demonstrates is what a close and strong relationship Australia and the United States have. This a very important summit. It is a summit at which we have to find ways to ease pressures on our global trading system. We very much look forward to a positive and constructive engagement with the President and his senior team.
QUESTION: On that economic question, how would you describe the risk to the Australian economy from the trade conflict that we are seeing? Are Australian living standards actually at stake in the meeting tonight between the Prime Minister and Donald Trump?
MATHIAS CORMANN: I would like to look at it more positively. The Prime Minister will be working tonight to ensure that Australian living standards will continue to be as strong as they possibly can be into the future. We are always focused on making sure that everything we do and all of our engagement is focused on building a stronger economy and making sure that people in Australia have the best possible opportunity to get ahead. That is what we will be focusing on tonight. We understand that the best prospect for Australians today and into the future to get ahead comes from a commitment around the world to free trade and to open engagement and a commitment to a multilateral based trading system, where rules may be reformed from time to time, but rules ought to be respected once…interrupted
QUESTION: Minister what can you tell us about the Australian who is missing in North Korea? What can the Government say and are their fears for his safety?
MATHIAS CORMANN: We are providing consular assistance to his family and our embassy in South Korea has reached out to relevant officials in North Korea. There are some complications in providing consular assistance into North Korea. We work through the Swedish Government in North Korea and all of these steps are underway. There are some privacy considerations here. There is not really much more that we can say at this stage, other than that we are undertaking all of the necessary steps to provide the appropriate support.
QUESTION: Do you have any idea where he is?
MATHIAS CORMANN: I cannot personally give you any specific information in relation to that.
QUESTION: Will the Prime Minister raise that with the President tonight?
MATHIAS CORMANN: I have not spoken to the Prime Minister yet today. I am sure the Prime Minister will be able to talk to you about this.
QUESTION: It is reported this morning that Malcolm Turnbull warned you the Governor-General would not do the required signing off on Peter Dutton becoming the Prime Minister because of constitutional concerns over his legitimacy to sit in the Parliament. Can you tell us what actually happened in that conversation?
MATHIAS CORMANN: I have read that same report. I believe that I have well and truly commented sufficiently in relation to all of these matters and I do not have anything further to add.
QUESTION: But was it wrong for Malcolm Turnbull to actually argue that the Governor-General should not appoint Peter Dutton as Prime Minister? Was that the wrong position?
MATHIAS CORMANN: I do not have anything further to add. I am not part of this story today. I have read the story, I believe that I have…interrupted
QUESTION: You are part of the story, you walked in and you told him that Malcolm Turnbull did not have the numbers in the Party Room, of course you were part of the story.
MATHIAS CORMANN: These matters have been well and truly canvassed over a long period of time. I do not have anything further to add to the extensive comments that I have already made.
QUESTION: But is it true that, is it true that you were aware of Malcolm Turnbull’s positon on the Governor-General?
MATHIAS CORMANN: You can ask me these questions in whatever way you want, I do not have anything further to add.
QUESTION: Minister, is the Prime Minister seeking a meeting with Xi Jinping? Are you hoping to have one at this gathering?
MATHIAS CORMANN: There is no formally scheduled meeting at this G20 Leaders Summit but the Prime Minister and President Xi Jinping will be at the same meeting and if there is an opportunity, I am sure they will have engagement.
QUESTION: But Minister, on that point, China is our largest trade partner, we have made a point of calling them out on their behaviour. Is it disappointing that Australia has not had a chance, the Prime Minister has not had a chance to have a formal bilateral meeting with the President?
MATHIAS CORMANN: No. I have been coming to quite a few of those G20 Leaders Summits now and you do not have meetings with all countries at all G20 Leaders Summits. In fact at most of the previous G20 Leaders Summits we did not have meetings with the President of the United States. We have had meetings at previous G20 Leaders Summits with the President of China, but not with the President of the United States. This time around, we are having a dinner with President Trump but there is no scheduled meeting with the President of China…interrupted
QUESTION: Can we ask why for two consecutive G20s now we have been told no?
MATHIAS CORMANN: There is a whole range of summits that take place every year and there is lots of opportunity to engage. On this occasion, we are not engaging in that formal way.
QUESTION: Senator, Fitch, the ratings agency has put out a report estimating that if these talks fail on Saturday and Mr Trump proceeds with his next threatened round of tariffs, it will wipe 0.4 per cent off global growth. Are you as a Government doing your own war-gaming or modelling on the impacts on growth?
MATHIAS CORMANN: We are working on this being a successful summit and that is what we will be focusing on over the weekend. We are always assessing how the global economy impacts on our domestic economy in Australia. As I have said before, it is in nobody’s interest for there to be an ongoing and sustained trade war between the US and China. It is not in the US’s interest, it is not in China’s interest and we certainly hope that sense and sensibility will prevail.
QUESTION: Don’t you think that the World Trade Organisation is now past its use by date given that neither China nor the United States is likely to return to that as a bargaining agency?
MATHIAS CORMANN: We support reforms of the WTO. We do believe that the WTO needs reform to make it more relevant and more responsive to the requirements in 2019 and beyond, That is good housekeeping. It is something that we supported in the context of the G20 Leaders Summit in Buenos Aires and we look forward to making more progress here.
QUESTION: But neither China nor the United States supports doing housekeeping on it, do they? They cannot do it if they do not get to it.
MATHIAS CORMANN: I disagree with that and from Australia’s point of view we will continue to make the argument that it is very important for the G20 community to express its support for free trade and open engagement and its support for our multilateral trading system. We recognise and support the need for reform, but ultimately it is in all of our interests to have a global trading system that is rules-based.
QUESTION: How can we be optimistic about that when China will not even meet with Australia?
MATHIAS CORMANN: The way to ease global trade tensions right now is for the US and China to find a way to resolve their issues and certainly from our point of view we will be doing what we can do to help facilitate that happening.
QUESTION: On the social media thing, how, what kind of response do you think there might be from the United States? What are your expectations and hopes from President Trump?
MATHIAS CORMANN: This is something that we are pursuing with the G20 as a whole and we think that there is broad instinctive agreement that social media companies should do more to prevent inappropriate violent and extremist content to be readily broadcast the way it has been, for example in the context of the Christchurch Massacre. That is an important issue which is personally very important to the Prime Minister. He will be pursuing it at this summit and we hope that we will get broad support for what we are suggesting.