From The Australian comes reports that the Trump Administration wants to renegotiate the Australia-United States Free Trade Agreement (AUSFTA):
One of US President Donald Trump’s top trade advisers has raised speculation the US will attempt to negotiate a new free trade deal with Australia.
Peter Navarro, director of Mr Trump’s White House Trade Council, named Australia and New Zealand as two nations the Trump administration will seek bilateral deals with.
Australia already has a free trade agreement with the US, signed in 2004, but Mr Trump has repeatedly said he will look at every trade deal the US has signed and renegotiate them if he can get a better deal for American workers…
Australian Foreign Minister Julie Bishop said on Thursday in Los Angeles there has been no indication from the Trump administration their agreement would be renegotiated.
“The Australia-US free trade agreement works very much in the US favour in the sense that there is a significant trade surplus,” Ms Bishop told reporters.
The Turnbull Government should politely tell the Trump Administration to take a long walk off a short pier. Or better yet, agree to rescind the AUSFTA altogether.
The AUSFTA was a shocker from the get go (see here). But don’t just take my word for it. The ABC’s Ian Verrender has today made similar arguments against AUSFTA:
The US last year clocked up an $US11 billion ($A14.6 billion) trade surplus with us thanks to the US Australian Free Trade deal we signed 12 years ago that also was a stinker.
As the Australian National University’s (ANU) Thomas Faunce reported, that deal was a major contributor to the 80 per cent blowout in the cost of the Pharmaceutical Benefits System, which has put enormous strain on the federal budget.
According to the ANU’s Crawford School, that pact has hurt Australia every year since it was signed, with $57 billion in lost and diverted trade in 2012 alone.
Strangely, that little nugget never seems to be mentioned by our leaders whenever they wax lyrical about the benefits of free trade deals.
Nor do they ever refer to the numerous reports and studies from their very own Productivity Commission that repeatedly call for greater caution in signing “free trade agreements” because they deliver few benefits and may “impose net costs on the community”.
As the Productivity Commission consistently has pointed out, these agreements are Preferential Trade Agreements — deals that inhibit and distort free trade not promote it.
Just like the TPP, the Trump Administration would do Australia a favour if it rescinded AUSFTA. The trick is to make sure that we do not replaced it with something worse.
