ChAFTA 10 Year Anniversary
Author: The Hon. Andrew Robb AO
CIIE Forum, Shanghai
I greatly appreciate the privilege of being invited to China to celebrate the 10-year Anniversary of the China Australia Free Trade Agreement (ChAFTA), and to acknowledge the remarkable success of that agreement.
In the year of the signing of the Agreement combined trade was $98 billion, ten years later it was $330 billion.
There is a true saying that invariably success has a thousand fathers, but I want to particularly acknowledge the Chinese chief negotiator, Commerce Minister, Gao Hucheng; he strongly believed in the power of an open economy. This was China’s first comprehensive agreement with any G20 country, and today there is 100% free tariffs for goods and services from China into Australia, and 98% free tariffs for Australian goods and services into China. A remarkable outcome.
To put this result in perspective, last year Australia bought $60 billion of goods and services from the United States, and the US bought $30 billion dollars of goods and services from Australia.
In the same year Australia bought nearly $100 billion of goods and services from China and China bought $250 billion of goods and services from Australia.
This is a spectacular result and confirms that Free Trade works for the benefit of all.
It also confirms the view of the then Australian Prime Minister, Tony Abbott, who said when he witnessed with President Xi, the signing of ChAFTA by Minister Gao and myself: “What you have collectively done is history making for both our countries – it will change our countries for the better, it will change our region for the better, it will change our world for the better.....”.
But we can and must take the agreement even further. In the 10 years since signing so much has changed – agreements always need regular reviewing.
We made a great start in services, but we can go much further, and the revolution in on-line commerce requires much further development of a host of new trading rules.
The last 70 years has seen so many countries opening up, with over 2.5 billion people removed from poverty and the longest period of growing prosperity ever. Free trade works.
Yet, emerging populist ideologies, especially in the West, are rebuilding protection walls, imposing export controls and stymieing global investment leading to millions of supply chains closing, curtailing growth and innovation. Most destructive is the arrival of the era of weaponised supply chains which balkanises the world.
History shows that this promotes authoritarianism and undermines hard won freedoms, democracy and happiness, with the large and strong doing what they will, and the smaller and weak suffering what they must.
Making ChAFTA even stronger takes a stand against this very destructive approach.
ChAFTA created the growing awareness that what China was good at, Australia needed, and what Australia was good at, China needed – it gave effect to the highly complementary nature of our two economies.
The 2015 Free Trade Agreement gave impetus and substance to the fact that Chinese and Australian business people are very comfortable doing business with one another.
Much credit for the huge success of ChAFTA should go to the 1.3 million Chinese Australians who have provided a powerful bridge between the two cultures.
Despite subsequent political differences that arose between China and Australia, the 50-year development of people-to-people linkages, especially at a commercial level and at the Australian diaspora level, and sensible engagement between our two governments, has seen a strong, respectful and prosperous working relationship being maintained between China and Australia.
Long may our relationship remain strong, respectful and constructive.