Why Everyone Needs To Take A Deep Breath Over The Chinese Trade Deal

Why the haste?

Why does Australia’s Free Trade Agreement with China need to be finalised for next week’s visit by Chinese President Xi Jinping and a political photo op?

It’s a question worth asking as the excitement builds over greater access for our farmers to the Chinese market and as the Government careens headlong toward signing the document within a week.

This morning’s focal point is the dairy industry.

Of course, it’s all still speculation, at least sort of, with the numerous caveats of “it’s not a deal until it’s a deal” and “negotiations are ongoing”. But the AFR reports that the chairman of Australian Dairy Farmers, Noel Campbell, said he is “quietly confident with the discussion we’ve had”.

He added that “The appearance to us is that both parties want to do a deal. We were ­comfortable with the interaction we had with the negotiators that they are working hard on our behalf.”

If the deal comes off it’s a long way from the angst and hand-wringing that came with the $1 milk at Australia’s big supermarket chains a couple of years back.

But there is another question worth asking – is this going to be a good deal for all Australians?

Already access to global markets is re-pointing gas supplies offshore and potentially raising the cost to local consumers. What will happen when the dairy producers, with access to 1 billion Chinese, a rising middle class and perhaps a drought, are forced to choose between export contracts and local sales?

Opposition Leader Bill Shorten’s concerns have been cast aside but closer to home Liberal Senator Bill Heffernan, via ABC24, is warning that this “generation of Australian which takes the wonderful world we live in for granted could turn into a disaster”.

The senator is principally questioning how you have a free trade agreement with a country that doesn’t allow its currency to float and warning that appropriate safeguards need to be put in place.

So while it would be ridiculous to deny Australian dairy farmers access to the burgeoning Chinese middle class on a level playing field with their Kiwi competitors and the giant Kiwi dairy corp Fonterra, where are the safeguards in this FTA or any of the recent investments and numerous free-trade-agreements, all of which appear focused externally?

It’s easy to lambast Senator Heffernan, as many do, but as Agriculture Minister Barnaby Joyce has said, Australia cannot be the bread basket for Asia. It’s simply too big, we’re too small, and we lack the productive capability.

So amongst all the excitement and rush to the signature table, it’s worth asking the question – what are the safeguards for Australian supply?

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