News Stories - 30 January 2007
Australian Trade Successes in Asia
Australia’s exports of goods and services to Asia grew by almost 20 per cent in 2005-06. In the first five months of 2006-07, merchandise exports to Asia have continued to grow strongly, increasing by 19 per cent compared with the same period the previous year. Key factors underpinning this growth are improved market access to Singapore and Thailand as a result of Free Trade Agreements (FTA) and strong demand in the region for our resources, particularly from China and India.
Australia’s trade with Singapore
In 2005-06, exports to Singapore totalled $6.9 billion, our 8th largest export market.
Our trade with Singapore has benefited from the entry into force of the Singapore-Australia Free Trade Agreement (SAFTA) on 28 July 2003 which resulted in tariff elimination across the board and the liberalisation of two-way trade in services. As Singapore had virtually no tariffs on Australian merchandise exports prior to SAFTA, the market access gains are concentrated in the services sector.
Services exports (which comprise around 39 per cent of our total trade with Singapore) are growing strongly, having increased by 10.1 per cent in 2005-06. This growth was underpinned by a 21 per cent increase in ‘transportation services exports’ and an 8.4 per cent increase in ‘other business services’. Australian service providers have also benefited from improved access to the government procurement market, including in the education sector.
The strength of domestic demand in the two economies, changes in the pattern of trade in the gold and oil sectors, and exchange rate movements have also affected the trading relationship in recent years.
Australia’s trade with Thailand
In 2005-06 Thailand was Australia’s 10th largest export market, with exports of goods and services valued at $4.9 billion.
The Thailand-Australia Free Trade Agreement (TAFTA) has been important in underpinning growth in trade since its entry into force in January 2005.
TAFTA eliminated more than half of Thailand’s 5,000 tariff items, delivering an immediate benefit for nearly 80 per cent of Australia’s exports to Thailand. The remaining tariffs are being phased out in annual increments, with virtually all to be eliminated by 2010. As a result, Australian exporters are enjoying significantly more favourable treatment than many of their competitors from non-ASEAN countries.
Solid economic growth in both economies, exchange rate movements, and developments in the oil and gold sectors have also had an impact on trade flows.
Australia’s resources exports to China and India
The rise of China and India as major world economies has implications for the world, including Australia, which is a key supplier of resources to both countries.
Australia’s exports of goods and services to China have grown five fold to $21 billion over the last decade. Resources products, including minerals, energy and processed metals, account for around 50 per cent of our total exports to China.
In recent years, India has also become a major resources market for Australia. In the five years to 2005-06, our goods and services exports to India rose over three fold to $8.8 billion, and India’s share of Australia’s exports rose from less than two per cent to just below 5 per cent.
With continued strong growth in China and India, there is considerable potential for resources exports to continue to grow further.
News Stories - 25 January 2007
China’s use of a ballistic missile to destroy a Chinese weather satellite
Australia has sought an explanation from China about its use of a ballistic missile to destroy a Chinese weather satellite. China’s responses to date have not addressed important questions about the danger posed by the debris generated by the explosion and China’s plans for deploying weapons systems with the capability of destroying space assets.
On Mr Downer’s instructions a senior official of the Department of Foreign Affairs and Trade called in the Ambassador of the People’s Republic of China in Canberra on 16 January to seek an explanation for the Chinese Government’s decision to launch a missile to destroy a Chinese weather satellite on 12 January.
Australia sought an explanation of the nature of the incident, and China’s assessment of the danger posed by the debris created by the incident, as well as China’s future plans for developing and deploying weapons systems with the capability of destroying space assets.
The destruction of the satellite appears to have created a significant amount of debris which has the potential to endanger manned and unmanned space assets of other countries including Australia.
China has acknowledged that it conducted a test in outer space, and asserted its opposition to the weaponisation of space, but has not addressed important questions about the danger posed by the debris, and China’s plans for deploying weapons systems with the capability of destroying space assets.
Australia will continue to press China for an adequate explanation.
Australia considers that all nations should have unhindered access to space for peaceful purposes and countries should avoid taking actions that could endanger the manned and unmanned space assets of other countries that put the peaceful use of space at risk.
Australia becomes party to both optional protocols on children’s rights
Australia recently ratified both Optional Protocols to the Convention on the Rights of the Child. The ratification demonstrates the Australian Government’s continuing commitment to the broader objectives of the Convention on the Rights of the Child and the promotion and protection of children’s rights.
Australia has ratified the Optional Protocols to the Convention on the Rights of the Child: the Optional Protocol on the involvement of children in armed conflict; and the Optional Protocol on sale of children, child prostitution and child pornography.
The Optional Protocol on involvement of children in armed conflict sets a new international standard for the protection of children in armed conflict. Consistent with the Optional Protocol, Australia has and will continue to:
- take all feasible measures to ensure that members of the Australian Defence Forces (ADF) under 18 years of age do not take part in direct hostilities; and
- ensure persons under 18 years of age are not compulsorily recruited into the ADF.
Child exploitation is a serious issue for the international community and for Australia. Ratification of the Optional Protocol on the sale of children, child prostitution and child pornography reflects the Australian Government’s strong stance on people trafficking and child exploitation.
Ratification complements Australia’s strong legislation and enforcement arrangements to combat sex crimes against children.
Australia has criminalised a range of serious violations of children’s rights, including the transfer of organs from children for profit, child prostitution and child pornography and the sale of a child for sexual exploitation and forced labour.
For the joint press release of Mr Downer the Minister for Foreign Affairs and Mr Ruddock the Attorney General, go to http://www.foreignminister.gov.au/releases/2007/fa007a_joint_07.html
Australia-China Clean Coal Initiative
During their 15 January meeting in the margins of the East Asia Summit, Prime Minister Howard and Chinese Premier Wen exchanged letters to formally establish an Australia-China Joint Coordination Group on Clean Coal Technology. Globally the cleaner use of coal is key to providing affordable and reliable base-load power while managing environmental issues, including air pollution and greenhouse gas emissions.
The Coordination Group will provide further strategic guidance, oversight, and impetus to a range of clean coal activities in Australia and in China with the aim of:
- sharing knowledge gained through clean coal, and other relevant projects, in Australia and China under the Australia-China Climate Change Partnership (ACCCP), the Bilateral Dialogue Mechanism on Resources Cooperation and the Asia-Pacific Partnership on Clean Development and Climate (AP6);
- identifying and implementing joint clean-coal technology projects, including through the ACCCP and AP6; and
- identifying areas where cooperation on the development demonstration and use of clean coal technologies can be enhanced.
The first meeting of the Coordination Group is scheduled for April. Members will include senior representatives from Government, industry and research organisations from both countries.
Under the AP6, Australia chairs and China co-chairs the Cleaner Fossil Energy Task Force.
Australia has committed A$100 million for the first five years of the AP6.
On 1 November 2006, Prime Minister Howard announced Australia would provide A$60 million for the first tranche of 42 AP6 projects, of which A$29 million will fund coal technology related projects, including cooperation with China.
An example of a key AP6 clean coal project is A$8 million funding for the development by the CSIRO of a mobile post-combustion capture plant to be used at different power stations to test the carbon capture potential of AP6 Partners.
Domestically and internationally Australia is involved in the development of clean coal technology under the following programs and initiatives:
- Carbon Sequestration Leadership Program;
- Methane to Markets Partnership; and
- A$235 million funding for clean-coal projects in Australia from the $A500 million Low Emissions Technology Demonstration Fund (LETDF).
For information on projects under the AP6 go to: http://www.dfat.gov.au/environment/climate/ap6/appcdc-booklet-06.pdf