31 March 2023

Patricia Karvelas, Host: It’s been a slow but steady process dethawing the diplomatic deep freeze with Beijing. Now that melting process is taking a while. But while communications between officials and ministers is building, much of the trade between the two nations is still on pause with billions of dollars hanging in the balance.

Tim Ayres is the Assistant Trade Minister and joins me this morning from China. Welcome back to Breakfast.

Tim Ayres, Assistant Minister for Trade and Assistant Minister for Manufacturing: G’day, Patricia. It’s very good to be here. It’s very early in the morning here, but I don’t think I’ll get much sympathy from you for getting up early for work in the morning.

Patricia Karvelas: Absolutely zero, but I am thankful that you’ve joined us. You’ve spoken with your counterpart the Vice-Minister for Commerce on the sidelines of this forum. You’ve said you’ve made progress in these talks. Where are we at now?

Assistant Minister: Well, there’s been some progress over the course of this year. It is important to say that most of the trade between Australia and China has been unaffected by these trade impediments. And, in fact, you know, trade with China is sitting at about $285 billion a year. There are a series of products here that have not been able to access the Chinese market. Since my – you know, I had a meeting with my counterpart very early this year and the Trade Minister, Don Farrell, had a very long exchange with the Chinese Commerce Minister.

There has been some progress. Shipments of Australian coal have arrived in Chinese ports. There’s been some changes in terms of cotton and timber. But we are still a long way away from securing a complete return to normal trade, and that is – you know, these exports that have been banned where there are impediments sitting in front of them are, you know, exports that affect, you know, particularly communities – wine, lobster, for example, that have a big impact in some communities in regional Australia, and we’re very focused on returning the trade to normal.

Patricia Karvelas: There are two official trade disputes with China being determined by the World Trade Organisation. You know, you’ve alluded to all of these, but let’s just get into it for wine and barley. Now, time is running out before the WTO makes its determination, which the government wants to avoid. So you actually don’t have a lot of time. Will you avoid it?

Assistant Minister: Well, the WTO process as far as Australia is concerned can take their course. We’re confident that the applications that we’ve made would be successful in the normal course of events. But we have indicated to China and indicated publicly that, you know, if these matters can be resolved by discussion and agreement then that’s in the interests of both Australia and China. And we’re prepared for discussions and officials are engaging in discussions about those matters and have been over the course of this year.

So let’s see where those discussions go. If there’s progress and it’s in the national interest, well, we are absolutely prepared to deal with these issues by agreement. If there can’t be agreement, then that’s what the WTO appeal process is for.

Patricia Karvelas: So, if you could give it sort of an assessment, how much closer are we after your trip?

Assistant Minister: Well, every opportunity for dialogue is good. It was a useful meeting where there was an exchange of views that, you know, confirmed the pathway that we’re on – that is, official-level dialogue, dialogue that’s dealing with the technical basis for the impediments that China has put in front of the trade. It was a workmanlike meeting that puts us perhaps another step closer towards resolving these issues.

We did confirm that the Trade Minister, Don Farrell, will be in due course travelling to China to meet with his counterparts, travelling to Beijing. That is, again, another important step along the way –

Patricia Karvelas: And did you confirm when that’s going to happen?

Assistant Minister: No, that will be a matter for Minister Farrell. The invitation has been extended. He’s accepted it. It will happen over the coming weeks or months.

Patricia Karvelas: You’re not the only Australian Government representative in China – Victorian Premier Daniel Andrews is also there. Have you spoken with him?

Assistant Minister: I haven’t spoken with Mr Andrews. He’s in a completely different part of China.

Patricia Karvelas: Big country.

Assistant Minister: I’m on Hainan Island here for the Boao Form. It’s been useful. The opportunity to meet with my counterpart was very important. But I’ve been here. Given that there hasn’t been an Australian government representative here at ministerial level since 2016, being here to be able to support the Australian businesses that are here, it’s been a very constructive couple of days. And I’m glad that I’ve come.

Patricia Karvelas: You say you haven’t talked to Daniel Andrews. Are you – do you think it’s useful for him to be there as well at the moment?

Assistant Minister: Well, the Prime Minister said a few days ago that it was a good sign. I know that Daniel Andrews is pursuing the interests of Victorian exporters. I understand particularly in the education sector. I have no doubt we’ll hear more from him when I get back to Australia. You know, that’s – it’s a good step and it’s a logical step forward for leaders at the state level to be engaging with their Chinese counterparts. That was a pretty consistent feature of the relationship before – you know, before the relationship deteriorated. And it’s – you know, it’s not a surprise that it’s now part as we work in a calm and consistent way to stabilise the relationship. It’s not a surprise to me that state leaders are beginning to engage with their counterparts.

Patricia Karvelas: There’s been a lot of criticism that the media hasn’t been taken with Premier Andrews. Do you think there should be full transparency and the media should be going along with ministers, premiers, to provide full scrutiny of these sorts of trips?

Assistant Minister: Well, there hasn’t been media here with me, you know, Australian media with me here in Boao either, Patricia. There is no Australian –

Patricia Karvelas: And explain why?

Assistant Minister: Well, there is no Australian media in China. I’ve sought to do as many, you know, interviews as I can with you and with your press gallery colleagues.

Patricia Karvelas: Yes.

Assistant Minister: That’s, I think, helpful to explain what’s going on. It gives the press gallery and, through you, the public the opportunity to have some engagement with what is happening here. It’s important. It’s in the national interest. I want to make sure that’s happening. But it’s not perfect by any means. It would be better if Australian journalists were able to be in the corridors of forums like this and, you know, that is something that I hope to see improve. But for my part, you know, I’m trying to engage as often as I can with people from the press gallery. There was a lot of discussion, I can tell you, from your colleagues in Canberra before I took off here.

Patricia Karvelas: Yes.

Assistant Minister: And I’d be delighted to talk to people here, even when occasionally it’s on a very bad line. And I’ll definitely do it when I come back, too.

Patricia Karvelas: So you’d like to get to a situation where China would let you travel with journalists as well to be able to report on the events? Is that a request that you’ve made of the –

Assistant Minister: Of course. Of course that would be better. I mean, I have to say, Patricia, that while I have – you know, like every politician in Canberra, I’ve got tickets on myself, as an assistant minister you don’t usually travel with a huge press pack. And what would normally have happened here is that there would be Australian journalists, you know, present at the forum and Australian journalists, you know, posted around Canberra – around China. That’s not the case at the moment. It obviously would be better if it was different.

Patricia Karvelas: Just on another issue – the chief executive of Japanese gas giant INPEX has warned the Safeguard Mechanism will choke investment, strangle expansion of LNG projects and allow Russia, China and Iran to fill the void. Now, as Assistant Trade Minister what’s your response to this? I mean, it’s a pretty bleak warning about our future.

Assistant Minister: Well, I don’t agree with his assessment. And it’s not the assessment of any of the – of any industry that I’ve met with either here or, you know, at other conferences or trade meetings. And I’ve had plenty of engagement with executives from our partners, you know, around the region in gas and in coal. There is no – you know, Australia is a reliable partner in the region for these kinds of exports. INPEX is an important investment. It’s, you know, an investment that’s really delivered for the Northern Territory but consistently delivers product around the region and will do for many decades to come.

Patricia Karvelas: Thank you so much for joining us, Tim Ayres.

Assistant Minister: Total pleasure, Patricia. Catch you next time.

Patricia Karvelas: Have a nap. Assistant Trade Minister Tim Ayres, who told us at the beginning he was up very early in China doing that interview with us. Thank you so much for his time, Assistant Trade Minister Tim Ayres. As he says, he doesn’t have tickets on himself.