“I think the heightened trade conflict is drawing other countries closer together in recognising the need to both defend the rules-based trading system but also to know that it can’t be defended as perfect and static,” Senator Birmingham said in an interview.
“It needs to be reformed and improved. Other countries realise that inaction has led us to a potential, and possibly even likely, crisis in one of the key functions of the WTO.”
Senator Birmingham has also ramped up pressure on India to progress the pan-Asian Regional Comprehensive Economic Partnership (RCEP), accusing it of not reaching a “sufficient standard of ambition”.
The EU-style trade agreement will bring together all 10 ASEAN member states and their partners – China, Japan, South Korea, Australia, New Zealand and India – for the first time if concluded. But trade negotiators are increasingly frustrated by India’s lack of material progress on the deal, which is likely to face stiff resistance from its agricultural and manufacturing lobbies.
“I think everyone is determined to try and conclude RCEP year but people left [the ASEAN meeting] without any doubts about the scale of the challenge required,” Senator Birmingham said.
“Now is the time to secure RCEP, [to show] the trend towards protectionism is not universally shared. We are committed to improving our economies by lowering barriers and opening up trade.”
Senator Birmingham said in a time of heightened global trade tensions and areas of rising protectionist sentiment, Australia faced “profound challenges”.
The volatility has forced the International Monetary Fund to cut trade volume growth forecasts by more than half from 5.5 per cent in 2017 to 2.5 per cent this year. Forecasts for global economic growth have also been revised from 3.6 per cent to 3.2 per cent.