Asean Investor

Big wins needed to sell FTAs

ASEAN_Investor
Publish date: Tue, 14 Jan 2014, 09:00 AM
Marc Djandji, CFA is the Editor-in-Chief of The ASEAN Insider, a subscription-based monthly investment newsletter committed to finding compelling investments backed by powerful structural trends in Southeast Asia. He is also a co-Founder and Partner of ASEAN Strategy Group Ltd., an independent investment banking boutique focusing on cross-border M&A and corporate finance advisory for companies in the small to mid-market segment in Southeast Asia.

fta

AUSTRALIA needs big wins for services and agriculture companies from free-trade agreements to convince the public these deals are worthwhile, Trade and Investment Minister Andrew Robb said.

Mr Robb will meet trade counterparts from other countries at the World Economic Forum in Switzerland this month after his trip to the United States.

He is hopeful that a follow-up meeting - likely to be in Singapore in February - of ministers from the 12 Trans-Pacific Partnership nations will go closer to clinching a deal ­covering 40 per cent of world trade.

The sticking point for Australia is attaining better access for agriculture and services, especially in the potentially lucrative Japanese market.

Australian exports are restricted by high Japanese tariffs and quotas for sugar in the US.

"There are winners and losers from any trade agreement, so for us to sell an agreement back into the community and for it to be embraced, Australia needs to see significant market access opportunity," he said.

"Because if you free things up, you impose more structural change."

In an interview last week Mr Robb said companies and politicians had to embrace industry change and ­economic restructuring.

Victorian Liberal MP Sharman Stone had earlier criticised cabinet members who are resisting a request from Coca-Cola Amatil's SPC Ardmona unit for $50 million in aid as motivated by free-market "dogma".

While manufacturing continues to struggle, services account for almost 80 per cent of Australia's economy and are expected to grow strongly, meaning that opening up new ­markets could produce big wins for services exporters.

Australia provides relatively open access for goods and services from its major trading partners.

Mr Robb has indicated the gov­ernment might be willing to make other concessions, such as recognition of the investor-state dispute ­settlement process, which would allow disaffected foreign companies to sue the Australian government.

The Trans-Pacific Partnership is supposed to be a "21st-century" regional free-trade and investment agreement among 12 countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam.

By JOHN KEHOE

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