Trust. Integrity. Honour.

A distinguished Australian politician who will go down in history as the co-architect of the landmark China Australia Free Trade Agreement together with his Chinese counter-part, Chinese Commerce Minister, Gao Hucheng.

Instrumental in engineering unprecedented access by Australian SME’s to the world’s largest domestic market, Andrew Robb has chosen to enter a new phase of his career to encourage businesses from both sides reap the vast opportunities that this agreement brings for decades to come.

Mr. Robb is The Asian Executive’s special guest at its 2017 Lunar New Year Corporate Dinner held at Crown Melbourne on 6 February.

The Asian Executive looks back with Mr. Robb to the negotiation process for the China Australia Free Trade Agreement (ChAfta).

 

TAE: Achieving a free trade agreement with China has been much talked about and speculated for two decades and more. In your view, what contributed to the delay in achieving what you have your team have done in a relatively short time.

AR: I am unable to comment on the specifics for the protracted delay. What I can comment on is when I arrived in the job nearly two years ago, the offer from China on agricultural concessions was the same offer to Australia from 2006. One historical observation that I would make is that former Labor Australian PM, Kevin Rudd, did not act appropriately by lecturing China on human rights in Mandarin at Peking University in April 2008. 

TAE: Can you trace back a significant moment in your role that kick-started the free trade negotiation process again?

AR: I recall my official visit to China with Australia’s largest ever trade mission of 700 delegates last year in April. I believe that official visit signaled a serious intention to the Chinese of our desire to take the relationship to another level and accelerate talks towards a conclusion of an agreement. That, together with contact between the two prime ministers helped shift past inertia.

Talks with my Chinese counterpart, Minister Gao Hucheng and many groups of other senior Chinese executives from the Politburo created a sense of momentum that carried through to a decisive conclusion. We worked towards specific dates and time constraints and found both parties willing and ready. 

TAE: The word “trust” comes up as a key to making the process of negotiations so much easier than what it would otherwise have been. Was this necessarily the case?

AR: Having a sense of trust is fundamental to all successful negotiations. My belief is that you have to put yourself in the shoes of the people to whom you are negotiating. You need to appreciate the political pressures points on the other side of the negotiation table. We experienced some tough negotiations along the way, but the element of trust shown by both sides helped smooth the path to a mutually beneficial outcome. Another aspect of the negotiations was the degree of frankness in which we exchanged words. I think playing games destroys trust, and there were none of that our discussions. We shared the political priorities we both had and from that mutual respect developed. Having trust helped to sort out mutual misunderstandings and have the patience to seek clarification if articulated points are not clear. It was not about saving face as it was to seek in the spirit of goodwill the true implication of taking a position.

TAE: I take from what you say that you don’t ascribe to the theory of the Asian Mind Game?

AR: No, I don’t at all. My approach to trade negotiations is the same for the Japanese as with the Koreans – the root basis for successful negotiations of establishing trust early on and sustaining that position in a consistent manner.

TAE: What feedback to you get from the major beef producers in Australia about the positive benefits of the free trade agreement?

AR: There is enormous enthusiasm. The trade protection around China’s local beef industry is essentially eliminated. The Australian brand is going to get a rapidly recognized throughout China – our gold standard reputation for green, clean, healthy produce.

TAE: ChAFTA has, what the Australian press came to know as an “Easter Egg” which grants Australia an enormous advantage over other countries doing business with China.

AR: Yes. It’s what is known as “The Most Favored Nation Clause.” The clause applies to a wide range of services and areas of investment. What is conferred to Australia is the right to have the same concession that is granted to another country in any subsequent negotiations with that country. While this status does not apply to goods, we will have an opportunity in 3 years time to review the goods market to reduce further protection both ways.

TAE: In your view, how has digital technology enabled SMEs the ability to participate in the global marketplace?

AR: The power of the internet has enabled SMEs to go online and seek out areas of demand outside of their local market place. In complex production processes, local Australian companies can supply to a much bigger production system such as those in the aerospace industry. The cost of physically engaging with the international business community is not great and does not require a large staff to support it.