Can new Prime Minister Malcolm Turnbull sell the free trade deal with China to Australians?

Greg Barns says by ousting the 'clueless' Tony Abbott, Australia's new prime minister now gets a chance to try to convince sceptical lawmakers to back the agreement

PUBLISHED : Tuesday, 15 September, 2015, 2:02pm
UPDATED : Tuesday, 15 September, 2015, 2:03pm

One of the most important challenges facing Malcolm Turnbull, the newly elected Australian prime minister (the fourth to hold that office since 2010), is what to do about China. One of the final blows to the unstable two-year reign of Tony Abbott, whom Turnbull replaced on Monday, was his inability to sell the benefits of the recently signed Australia-China free trade deal. Abbott's opponents in the opposition Australian Labor Party and its allies in the trade union movement have been running a very potent campaign against the trade deal, arguing it will take away Australian jobs.

China is Australia's largest trading partner and the free trade agreement has been more than a decade in the making. When it was signed on June 17, Australian trade minister Andrew Robb focused on the fact that from day one of the agreement, "more than 85 per cent of Australian goods exports will be tariff-free, rising to 95 per cent on full implementation". The trade deal must still be ratified by the Australian parliament and given that Turnbull's government does not have a majority in the Senate, the Australian legislature's upper house, it is no sure thing.

Turnbull will wish to show the region that Australia can play the role of an independent middle power

The unions and Labor have tapped into Australian concerns that Chinese workers will take local jobs because, under the deal, infrastructure projects worth A$150 million (HK$827 million) or more and with 50 per cent Chinese ownership are able to bring in Chinese workers without having to source Australian workers first. The campaign has won the support of some of the independent and minor-party MPs who hold the balance of power in the Senate and has assisted Labor in holding a lead in opinion polls with a national election a year away.

One of the major planks of Turnbull's pitch to his parliamentary colleagues on Monday as to why he should be prime minister was that Abbott had done a poor job of selling economic reform and that what was required was more than slogans and one-liners. Turnbull now has a chance to put his formidable communication skills to effect in seeking to win back support for the free trade agreement. This is not easy in an isolated country where populist slogans about foreigners taking Australian jobs and undermining Australian work conditions remain potent and effective.

Another issue of high priority in Turnbull's in-tray is what to do about Australia's stance on the tensions between China, its neighbours and the US in the South China Sea. Abbott's policy settings towards China veered wildly. He cultivated Japan's Prime Minister Shinzo Abe in a very public way and told German Chancellor Angela Merkel in November last year that Australia's stance towards China is driven by "fear and greed". At the same time, he lavished praise on China's President Xi Jinping when the latter visited Australia, also in November last year. High White, one of Australia's leading defence and foreign policy strategists, dubbed Abbott as "clueless" about how to deal with China.

Turnbull is a more nuanced thinker than the deeply conservative Abbott and is more likely to take issue with the US "pivot" policy in the Asia-Pacific region. In 2011, he noted that an "Australian government needs to be careful not to allow a doe-eyed fascination with the leader of the free world to distract from the reality that our national interest requires us to truly (and not just rhetorically) maintain both an ally in Washington and a good friend in Beijing".

One of the leaders of the region with whom Turnbull is enamoured is New Zealand's Prime Minister John Key. Key's foreign policy positioning is very much based on putting New Zealand's strategic interests first when it comes to negotiating between China on the one hand and the US and Japan on the other. Turnbull is likely to follow suit. He will wish to show the region that Australia can play the role of an independent middle power instead of feeling the need to side with either Beijing or Washington and Tokyo on every occasion.

Greg Barns is an Australian political commentator and, with Malcolm Turnbull, ran the 1999 referendum on Australia becoming a republic