The WTO report on Australia’s trade policies, issued earlier this month, urges action to secure the gains from the minerals boom
“A major economic challenge confronting Australia, with potential trade policy implications, is to formulate appropriate macroeconomic and structural policies to facilitate rather than impede adjustment to the effects of its greatly improved terms of trade owing to the mining boom and the associated appreciation of the Australian dollar. The latter is likely to reduce the competitiveness of import-competing activities and non-mining exports, unless productivity in these activities can be improved. This will have far-reaching implications for the pattern of growth and structure of the economy by necessitating a reallocation of domestic resources. Significant structural adjustment by the non-mining economy will be required.” Extract from the Secretariat assessment WTO Trade Policy Review of Australia
The WTO Secretariat reports the discussion of our trade policies by other WTO Members in diplomatic terms. But it’s clear from the summary which of our policies are the most severe irritants to our trading partners.
They’re the same policy shortcomings that cost Australian consumers billions of dollars in unnecessary costs and lost opportunities.
“SPS [i.e. “quarantine“]. Virtually all Members expressed concern over Australia’s strict SPS requirements, including the lack of cost-benefit analysis; they urged Australia to re-evaluate these measures with a view to bringing them more into line with international norms and thus rendering them less restrictive as regards imports.
FDI [“foreign direct investment”]. Some Members expressed concern over remaining foreign investment restrictions in sensitive sectors (on grounds of “national interest”) and hoped that Australia would consider liberalizing them.
Government procurement. Some Members expressed concern over Australia’s use of government procurement as an instrument of economic policy; they were critical of inter alia the “buy local” requirements by certain states and encouraged Australia to implement a single procurement policy and join the WTO Agreement on Government Procurement.
Trade remedies. Certain Members expressed concern over the deficiencies of the anti-dumping and countervailing system, and called for lesser reliance on the former.
Tariff structure. Despite Australia’s low level of tariff protection, some Members called for further action, including the reduction in remaining tariff peaks and simplification of the tariff structure by inter alia converting non-ad valorem into ad valorem rates.
Support. Information was sought on the operation of an export support scheme and export controls. Some members noted the level of industry-specific support provided to the automotive, textiles, clothing and footwear industries and expressed the hope that it would be reduced. “
Extract from the Summary of the discussion by the TPRM Chair