Second Reading – China FTA

Wednesday, 21 October 2015

Mr PITT (Hinkler) (11:21): I would like to thank the member for Macarthur for his good grace in allowing me to get a brief opportunity to speak. I rise to speak in support of the bill to enact the China-Australia Free Trade Agreement, or ChAFTA, as it is more commonly known.

China is Australia’s largest trading partner. It buys almost a third of all Australian exports, valued at nearly $108 billion in 2013-14, and is our top overseas market for agriculture, resources and services exports. Chinese investment in Australia has been growing strongly in recent years, reaching almost $65 billion in 2014.

But I know there has been some concern in my community about Chinese investment. Since coming to government, we have strengthened Australia’s foreign investment framework. The Australian government has the ability to screen Chinese investments at lower thresholds than ever before for agricultural land and sensitive sectors like media, telecommunications and defence-related industries. Previously, foreign purchases of agricultural land were only subject to the national interest test and close scrutiny if they were worth more than $252 million. On 1 March this year, we reduced that screening threshold from $252 million to $15 million. That means that any agricultural land purchases worth more than $15 million are now subject to closer scrutiny.

I want to emphasise the fact that the China FTA will not threaten Australian jobs. Chinese investors will only be able to temporarily bring in skilled overseas workers when suitable Australian workers cannot be found. They must receive the same pay and conditions as Australian workers, and Australian workers must be given the first opportunity, unless there is evidence of a genuine labour market need. For example, the companies must provide evidence of their domestic recruitment efforts and why applicants were unsuccessful.

As a former engineer and someone who ran a safety inspection and training business, I know just how important it is that people actually know what they are doing. Contrary to what the scaremongering unions would have us believe, the China FTA will not allow electricians to work in Australia without any skills assessment. All applicants for subclass 457 temporary work visas will still need to have the requisite skills, qualifications and work experience. I would like to briefly mention the contribution from the member for Bendigo and suggest strongly to the member that the member actually looks up the definition of statute law and the application for training, for licensing, for workplace health and safety inside state boundaries, because quite simply that is the place where these things are enforced.

Another myth surrounding the China FTA is that it will allow businesses to import dangerous substances such as asbestos. Under the agreement, all of Australia’s safety regulations and prohibitions on imports and exports remain in place. The ChAFTA does not allow food importers to bypass Australia’s food safety standards and import contaminated foods. Our science based biosecurity system remains in place.

Importantly, this agreement is a significant win for all the producers of fresh and processed food in my electorate. China buys more of Australia’s agricultural produce than any other country, and that is only expected to grow with this landmark agreement. China is Australia’s largest agriculture and fisheries export market, worth $9 billion in 2013-14, up from $5 billion in 2010-11. The absence of a bilateral FTA with China has meant Australian producers and exporters have faced significant tariffs on agricultural products and have been at a competitive disadvantage to countries that have an FTA with China, such as New Zealand.

The ChAFTA gives Australia a significant advantage over larger players such as the US. Let me give you some brief examples. Tariffs of up to 65 per cent on spirits, like the famous Bundaberg Rum, will be eliminated within four years. There will be elimination of the 10 to 25 per cent tariff on macadamia nuts within four years, and elimination of the 10 to 30 per cent tariff on all fruit, except citrus, within four years, with the tariffs on citrus eliminated in eight years. It also means the elimination of the 10 to 13 per cent tariff on all fresh vegetables within four years. Tariffs will also be eliminated on canned goods, fruit juices, chocolate and honey.

Australian seafood exports to China totalled $37 million in 2013-14. Tariffs will be eliminated progressively over the next four years on all Australian seafood exports, including crabs, scallops and prawns, which is good news for the people in my electorate.

China has guaranteed that Australian service suppliers are able to construct, renovate and operate wholly Australian-owned hotels and restaurants in China. Australian medical service suppliers will be able to establish wholly Australian-owned hospitals in China. China has made its first ever commitment in an FTA on aged-care services, allowing Australian medical service suppliers to establish wholly Australian-owned profit-making aged-care institutions in China with no geographical restrictions.

What all this means is that our local businesses will find it easier to break into or expand within the Chinese market. Growing their businesses ultimately leads to the creation of more local jobs—jobs that are desperately needed in my electorate. They are jobs for current and future generations, and I am absolutely delighted to be part of a government that has delivered such a landmark agreement. I commend the bill to the House.

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