Sensible compromise on CHAfta, except…

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From Phil Coorey:

The political impasse over the China trade deal could soon be broken with Labor shifting its position to enable the protection of local jobs while leaving the deal untouched and allowing both the government and Beijing to save face.

Senior sources have told The Australian Financial Review that while Labor would still insist on legislated changes to the Migration Act to enforce labour market testing before workers were imported, there would be no specific mention of China or the China-Australia Free Trade Agreement (ChAFTA).

The safeguards would, in effect, apply generally to all FTAs, would be non-discriminatory and require no change whatsoever to the agreement itself.

At the same time, it would still assuage labour movement concerns over the China agreement, which has more generous provisions for imported workers on large projects than any comparable deal.

A sensible enough compromise except for one tiny detail. China clearly wants to bring in its coolies so that there is no repeat of the kind of debacle we’ve seen in Sino Iron where labour played no small part in giant cost blowouts. And fair enough, too, from their perspective. Suddenly erecting ‘behind the border’ labour protections that the FTA was designed to circumvent will hardly please the Chinese. It’s not exactly a subtle maneuver is it. Not craftily played real politik.

If I were China I would politely tell us where to stick the FTA.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.