Interview with Hamish Macdonald, ABC Radio National Breakfast

20 January 2023


SUBJECTS: UK Free Trade Agreement; EU Free Trade Agreement; opportunities for Australian farmers; sustainability; trade with China

HAMISH MACDONALD, HOST: This is RN Breakfast. The Agriculture Minister has spent the week in Europe, hoping to hurry along the implementation of two multi-billion dollars trade deals. The crucial trade talks focus on the United Kingdom and the European Union. If he's successful it would make it easier to find Australian beef in England or France, and cheaper imported products in your local supermarket here.

I spoke to the Agriculture and Emergency Management Minister, Murray Watt, from Berlin.


HAMISH MACDONALD: I want to start with the UK trade deal; it was signed more than a year ago, recently ratified in Australia. What's the holdup in Britain? 

MURRAY WATT: Well, I think even the British acknowledge that some of the instability they've had within their political system over the last few months has impacted on things like this legislation, but I was very pleased that the meetings that I had while I was in London indicate that by and large there remains strong support for legislating the Australia UK Free Trade Agreement.

I think people in the UK generally understand that there's a very good deal here for both countries, good market access to different products. Of course Australia has the opportunity to meet some of the gaps in the market with high-quality beef, sheep meat, seafood, all sorts of other products as well, and the British want to take advantage of that. And of course, I'm following up the visit that Don Farrell made here late last year as the Trade Minister. And we've noticed that there has been a bit of criticism of the deal by some British politicians and farm groups, but by and large we remain pretty confident that this will get done as soon as possible.

HAMISH MACDONALD: Yes, I understand that the concern comes from the agricultural sector about what the impact might be of Australian goods coming into the market there on the farmers in the UK particularly in the wake of Brexit, is it correct that they believe Australian products are produced at lower, less costly standards? 

MURRAY WATT: That is certainly an argument that's being made by some of the farm groups, and I can understand why they might be a little bit concerned about such good, high quality product that Australia can produce entering the market, but one of the things we've been able to say to them is that even because of Australia's geographic proximity to the Asian market and the size of that market, we expect that Asian countries will remain our major export markets for agricultural produce for a long time to come. But what's different about the UK and also the EU is that they're very high value markets who are prepared to pay good prices for premium product.

So we don't think there's really a risk of our products flooding the market in the UK, but even the extra quotas that have been negotiated under the agreement represent a really substantial gain for agricultural producers in Australia.

HAMISH MACDONALD: So when is this going to be resolved, how far off are we? 

MURRAY WATT: Yeah well, both Prime Minister Albanese and Prime Minister Sunak at the G20 late last year agreed that this agreement would come into force in the first quarter of this year, and that's of course something that I was reminding people of, and that is our position, is that those commitments-

HAMISH MACDONALD: But what are you hearing from   with respect, what are you actually coming away with? 

MURRAY WATT: Well, some of the these that I had actually gave me quite a lot of confidence that that deadline can still be met. We were getting different information before I came over here as to how quickly it could happen, but meetings that I had with UK ministers indicated that things are on track from their perspective, and meetings that I had with the relevant House of Lords committee who's considering this at the moment give me quite a degree of confidence that we can get there. But we don't want to take it for granted, and that's why I'm over here, is to make sure that that deadline is met, because those extra quotas that our farmers will be able to take advantage of are basically allocated on a yearly basis, and we want to be able to get as much product in under that agreement as we possibly can, as quickly as we can.

HAMISH MACDONALD: You're currently in Berlin, I understand, trying to accelerate the EU Free Trade Agreement. Are Australian producers going to be prevented from putting names like feta or Prosecco on their products? 

MURRAY WATT: I am in Berlin now, and again, following up the visit that Don Farrell made last year, and we're very keen to make sure that the deal that we get with the EU is a really meaningful one in terms of the market access that we can gain for our products.

There is definitely concern from some quarters about what's known as geographical indicators, so the use of terminology like "feta", "parmesan" "Prosecco", I've literally - just before I spoke to you - been speaking to a number of European Agriculture Ministers, and they've raised that with me in the last hour, so it's certainly a concern to them. But we've been really making the point as well that those terms mean a lot to Australian producers as well. You've probably seen the stories about European migrants to Australia who brought Prosecco vines with them and have been manufacturing those sorts of products for a long time under that name, so-

HAMISH MACDONALD: So is that a red line for Australia? 

MURRAY WATT: We have expressed repeatedly that that is a very difficult issue for our producers, and we think they should be entitled to use those terms. But the European Union is making it clear that that's a red line from their perspective as well. So we're still working through that, and as I say, I think one of the things that's important for everyone to understand in Australia is that while there is a lot of attention on the GIs issue, and rightly so, we also need to think about the huge gains that can be gained in other products; like beef, like sheep, like everything from nuts to dairy products, to wines, all sorts of things that Australia stands to gain from being able to export more to the EU.

HAMISH MACDONALD: It sounds like you're going to give them that? 

MURRAY WATT: No, no, we absolutely are pushing back on the GIs issue, and as I say we're-

HAMISH MACDONALD: Sure, but if they've said that's a red line, and you think it's important for us to see the broader context of opportunity for beef and other products, that sounds very much like you're softening us up for you granting them that concession.

MURRAY WATT: Well we certainly haven't said that to the EU, and as I say, we've repeatedly, between Don and myself, made clear that that is something that we would not be happy with, and we're trying to get them to understand our perspective on this issue, and as I say, the emotional attachment that many Australian producers have to these terms just as much as European producers do as well. So we'll keep fighting that battle while at the same time trying to do everything we can to open up market access for a range of other products too.

HAMISH MACDONALD: How much of a problem is Australia's long history of land clearing?  We've been compared, as I understand it, to Brazil and Indonesia on this. What does the EU want to see change? 

MURRAY WATT: Well, I think it's something that I probably was conscious of coming over here, but it's really hitting me in the face now, is how important it is for Australia to be able to demonstrate good, sustainable agricultural practices. And frankly, I think the record of the last Government over the last 10 years did a lot of harm to our reputation internationally, including in agriculture. And that's, again, one of the reasons why I've come over here, including to a big sustainable agriculture conference that's being held in Berlin, is to make sure that people understand, first of all, we've got a new Government that has a much stronger commitment to these issues than we've seen before, and in fact that our producers in Australia are far more sustainable than a lot of people realise, people aren't aware, for instance-

HAMISH MACDONALD: Do you need to though demonstrate to the Europeans that there are specific sector wide targets being imposed in order to reach your net zero or 43 per cent emission production targets? 

MURRAY WATT: That generally isn't what people are looking for here. What people are looking for is a really clear and genuine commitment to increasing the sustainability of our production. Some countries in Europe have sector based targets for particular sectors of their economy, but many of them don't. What most of them are- well what all of them are doing though is really stressing the importance of more sustainable production, and what I'm able to say to them is that Australia's got a good story to tell on that front-

HAMISH MACDONALD: Sure, but what's the evidence of that if you can't actually demonstrate to them that emissions are coming down specifically in that sector? 

MURRAY WATT: Well what we can point to, for instance, is that already in our beef sector emissions have fallen by 58 per cent just since 2005, and Meat and Livestock Australia, the Red Meat Advisory Council - which represents industries who are sometimes accused of having not a great environmental record - they've both got targets of being carbon neutral by 2030, and a lot of people in Europe are surprised to hear that kind of thing.

We can also point to a range of other actions that are being taken by the new Government to strengthen our biodiversity and carbon credit markets, which will have big implications for agriculture. We've obviously signed up to the Global Methane Pledge, something the former Government refused to do, and I think people can see that things have really moved.

I'm not saying that things, you know, are final, and there's still a lot more work to do. I've got the National Farmers’ Federation President, Fiona Simson here with me, because she can give a perspective from farmers as well, to tell people in Europe what's actually going on in Australian farms, and how people are improving their product. But there's no doubt that for us to be able to maintain and grow new markets for our product overseas is incredibly reliant on us demonstrating the best possibly sustainability practices. And for anyone who pretends that that's not required, they're just completely out of touch with international trade, and with what Australian farmers are already doing.

HAMISH MACDONALD: There are some signs that the $20 billion worth of trade sanctions placed on us by China may be thawing; some reports around lobster orders potentially coming through from China's biggest seafood importers. Do you have any specific information that would indicate that that's the case? 

MURRAY WATT: Well look, I've seen those reports, just as you have, Hamish, and we haven't sort of received any official notification from the Chinese Government that they're about to drop some of those trade bans that they put in place, but all of the indications are very encouraging. You've mentioned lobsters, there's a couple of other products where there has been renewed interest from Chinese buyers over the last few weeks-


MURRAY WATT: But nothing really - well, there's nothing really solid, but there's certainly talk around the industry, in different parts of the industry, that they're getting approaches and interest that they haven't had for a while. So, you know, we've got a long way to go, and as I say, we haven't received any official notification that some of those trade bans have been dropped, but even if we're starting to see the renewal of that kind of dialogue, then that's obviously a good thing for our producers.

HAMISH MACDONALD: Murray Watt, thanks for your time. A very happy 50th birthday as well.

MURRAY WATT: Thanks, Hamish. Good to celebrate it by talking to you!

HAMISH MACDONALD: That's the Agriculture Minister, Murray Watt.