Economic and Political Outlook 2021
Check out CEDA's new report featuring insights from economists and political commentators on the year ahead.
Australia is looking to lift its economic ties with the United States through critical minerals and technology, a digital trade agreement and ultimately its return to the Trans Pacific Partnership (TPP), Australian Ambassador to the United States, the Hon. Arthur Sinodinos AO, told the audience at CEDA’s 2021 Economic and Political Outlook (EPO).
“We did well under the previous administration compared to many other countries, but there is plenty of scope to deepen our bi-lateral engagement and encourage the commitment of the US to the Indo-Pacific,” he said.
“The PM and the President have talked about deepening our defence technology cooperation – further deepening our defence technology cooperation – further integrating our defence industrial bases.
“We’ve talked about a strategic economic dialogue which lifts the economic parts of our relationship to the same level as our defence and security relationship – areas like critical minerals, technologies which are relevant to national security, are all areas that we are going to be pursuing with the US through various dialogues.
Ambassador Sinodinos also confirmed Australia’s commitment to pursuing a digital trade agreement with the US.
“Discussions had started with the previous administration; the new administration has indicated interest in this,” he said.
“Once the new US trade representative is confirmed, we will pursue that further.
“A digital trade agreement would allow particularly small businesses to trade more easily in a digital world across borders through mutual recognition of payment systems and the like.
“All these are building blocks though.”
Transpacific Partnership key to deepen economic engagement
Ambassador Sinodinos also confirmed Australia wanted the US to deepen its economic engagement with the region by rejoining the Trans Pacific Partnership.
“At the moment, the Trans Pacific Partnership is a bit like Hamlet without the prince,” he said.
“We need the US in there to maximise the benefits of the partnership and also maximise the strategic benefits of the US in the region.
“The major trade agreement in the region, the Regional Comprehensive Economic Partnership (RCEP), is the one between ASEAN and its free-trade partners, which include Australia and China.
“We want the Trans Pacific Partnership, a high-quality agreement, to set the standards in the region.
Australia also wants the US to help lead reform of the World Trade Organisation (WTO), so it can more effectively deal with infractions of national trade rules, Ambassador Sinodinos said.
“Our pitch to the US is that if we all work together – like-minded countries, allies and partners – the weight of countries in GDP will encourage the Chinese in particular to change the calculus of costs and benefits and think more about how they cooperate with the existing rules-based order rather than seek to change the order in their own favour,” he said.
US faces similar climate challenges to Australia
Speaking on climate change, the Ambassador said the US faced similar changes to Australia.
“They have a similar economic structure and therefore a similar challenge in how they transit to a more carbon-constrained world,” he said.
“We think there’s plenty of scope for a productive dialogue on how we get there.
“[Their] aim is net zero by 2050, and carbon-free power in the electricity sector by 2035. Their approach is around standards, around regulations, investment in clean energy including through their infrastructure program.
“With our climate policy…we have a detailed technology roadmap to drive investment in cost-effective new low-emissions technologies, which we believe will lend credibility to targets – and revisions to targets – that may be set by the Government.
“We’ve already agreed with the US on…a joint working group on low-emissions technology, which we may also end up linking with some of the other memorandums of understanding we have in the region with other countries on energy cooperation.”
CEDA’s 2021 Economic and Political Outlook (EPO) report examines why governments should seize opportunities that deliver long-term economic and social benefits to secure Australia’s recovery from the COVID-19 pandemic.
EPO 2021 CHAPTERS AND CONTRIBUTORS