Robb chuffed with ChAFTA

“It puts pressure on other countries, like Japan and Korea and all of our other markets, that will have to step up if we’re increasing exports of our premium products into the Chinese market,” he told Fairfax Agricultural Media.

“It will lay the foundation for greater prosperity for Australian agriculture and the rest of the economy for many, many decades to come.”

Industry groups and politicians alike have welcomed the deal’s capacity to bolster Australian agricultural exports to the nation’s biggest market, valued at about $9 billion last year.

As global population grows by more than 2 billion over the next 35 years and middle class incomes expand, the Australian Bureau of Agricultural and Resource Economics and Sciences predicts China will account for 43 per cent of all growth worldwide in agricultural demand to 2050.

Mr Robb said the ChAFTA provided strong results for dairy, beef, sheepmeat, horticulture and wine that will all have tariff protections fully eliminated over time.

He said those outcomes – as demanded by farm industry groups – represented an equivalent outcome or better than the NZ-China FTA.

The NZ-China FTA deal secured tariff elimination on beef and sheepmeat exports phased out over nine years from 2008 and also provided a significant head-start on dairy exports.

But Mr Robb said while the ChAFTA is “certainly equivalent” to NZ deal, it was also better because “it will have nowhere near the potential to reinstate protections, if the market grows too quickly”.

He acknowledged disappointment for grains, sugar and cotton that carried “great sensitivity” for the Chinese market, but stressed the two-stage deal would be reviewed in three years’ time providing an opportunity to renegotiate outcomes for those commodities, which was written into the agreement.

“The intention was to not hold up 98 per cent of the deal for those areas where we couldn’t reach agreement (but) it cost China any opportunity for changing the thresholds on investments for state owned enterprises,” he said.

However, Mr Robb said when China joined the World Trade Organisation in 2001 it was required to provide access quotas on those key commodities.

He said 880,000 tonnes of Australian cotton was sold to China valued at $1.7 billion last year, 870,000t of wheat valued at $283 million and 100,000t of sugar worth $48m. The sugar volume was 13,000t more than what was currently allowed to be sold into the US.

He said Australia had sold no rice into China this year but was awaiting phytosanitary approval to allow access under its global quota of 5.32 million tonnes.

“We will be looking to actively improve that outlook in three years’ time and will keep the pressure on to get health approvals for rice and provide significant access to the Chinese market,” he said.

Mr Robb said the deal also provided good outcomes for providing services into China around agriculture, such as water management.

He said China had 20pc of the world’s population but only 7pc of the world’s water volume - and a vast percentage of that is polluted. Many water management firms “sprinkled” throughout Australia now had opportunity to assist China with restoring the health of underground water supplies and irrigation systems, he said.

“Irrigation technology that’s been introduced in north-east Victoria in recent years is world leading, and has halved the amount of water that’s been used for production and is being sold to places like Brazil.

“For those sorts of technologies and services, we’ve opened the door to operate in China - not specifically in joint ventures but also in their own right.”

Labor Shadow Trade Minister Penny Wong acknowledged Mr Robb’s work in concluding the decade-long negotiations, but also praised the contribution of past Labor Trade Ministers, particularly Craig Emerson and Simon Crean, in negotiating the outcome over time.

“We welcome the conclusion of the negotiations and we look forward to the government actually releasing the details of the agreement,” she said.

“The government didn’t get the agreement done in time so they needed to sign a statement of intent and presumably they’ll sign the agreement in the next couple of months when they finalise it.

“I would say the government should be a little more transparent than it is being.

“We’ve had a lot of media backgrounding, a lot of information given to selected media outlets.

“What we haven’t had is Australians being let in on the secret of what’s in the deal - and I think the government should be releasing the text as soon as possible.”

“I would have hoped that that National Party might focus on things like including sugar in the FTA, rather than simply putting in place what really is a political position.”

The Ricegrowers Association (RGA) of Australia said its members were disappointed by the exclusion of rice from the ChAFTA.

RGA president Les Gordon said the rice industry had worked closely with the federal government in their efforts to finalise trade agreements with Korea, Japan and China over the past year but

unfortunately rice had missed out in all three.

"We are disappointed the FTA with China was not as comprehensive as it could have been as it did not include all agricultural products," Mr Gordon said.

Australian rice technically already has access to the Chinese market under World Trade Organisation rules but the industry has been waiting for protocols to be finalised for more than six years to actually gain access.

Mr Gordon said the RGA's focus was now on finalising import quarantine protocols with federal Agriculture Minister, Barnaby Joyce, and his department.

The exclusion of sugar from the FTA also left industry stakeholders bitterly disappointed.

Sugar is one of the industries set to continue negotiations prior to a three-year review. Australia is the third largest raw sugar supplier in the world, with the value of production an estimated $1.7 to $2 billion.

The move is another setback in a difficult year for sugar, following the withdrawal of major players from current marketing arrangements prompting a Senate inquiry into the industry.

Canegrowers chairman Paul Schembri labelled the move as an absolutely unacceptable outcome.

“Not only is this a lost opportunity for our industry, it is a lost opportunity for China’s sugar importers,” he said.

"Yes, sugar is traditionally difficult in trade negotiations, but the fact remains there was no good reason for this to occur."

Mr Robb and Chinese Commerce Minister Gao Hucheng signed a Declaration of Intent on Monday in Canberra to coincide with Chinese President Xi Jinping’s diplomatic visit, concluding the decade-long negotiations.

- with Vern Graham and Melody Labinsky