Transcript - Interview on CNBC Asia

WILL KOULOURIS

I’m very pleased right now to be able to welcome the Deputy Prime Minister of Australia, Michael McCormack, he’s joining us live from Canberra. Deputy Prime Minister, thank you so much for being here.

MICHAEL McCORMACK

It’s a pleasure.

WILL KOULOURIS

In terms of the spend that we are seeing on this Budget, though, you know that potentially later tonight we’re going to hear from the Opposition. There’s going to obviously be those people that say we’re spending too much in terms of the $161 billion Australian deficit. But realistically with the impact that we saw from COVID-19 and the hope that we can really get this unemployment rate below five per cent and the recovery back on track, was there really any other alternative?

MICHAEL McCORMACK

There was not and that is why John Howard, indeed, former greatly acknowledged Prime Minister of this country said when you do have a situation such as this then you need to throw everything at it, to ensure that those jobless queues which we saw very early in the pandemic, which were reminiscent of the Great Depression, we didn’t want to see those continuing. We wanted to see businesses as best as they could to be able to stay open. And that’s what why we put in place a measure called JobKeeper, which enabled businesses to remain connected with their employees, to remain with their doors open and remain functioning and trading. And that’s why we also extended the JobSeeker allowance, which is our, effectively, unemployment rate, to give those people who suddenly found themselves on the welfare queues – for sometimes the first time in their lives – the dignity of being able to still put bread and butter on the table to still have that ability to be able to finance their lives. We’ve made some tough decisions. We’ve made some big calls, yes, but Australia is the envy of the world when you look at our low case rates. Yes, we’ve lost 910 Australians and that is very, very sad for their families. But if you consider what was being tipped early in the piece with thousands of people dying, with potentially, you know, much of the population being affected by this virus, we’ve done very, very well.

WILL KOULOURIS

And I wanted to touch on, as well as, because you’re obviously the Minister for Regional Development as part of your many portfolios but we’ve seen a considerable shift, I suppose, when it does come to this investment as well in green technologies, this investment that has been earmarked in terms of really making that shift. And, you know, it all ties into the Biden Summit that we had back in April towards things like green hydrogen, towards things like carbon capture technology. So how important is that going to be? Because you’ve also got to balance the fact that in a lot of these regional areas perhaps the coal-fired plant is the big source or the big employer? So, how do you navigate trying to find that balance and ensuring that we still meet all of our targets moving forward?

MICHAEL McCORMACK

Well, you’re totally right and we’ve absolutely done what you’ve just said – we’ve had that balance. That word is very important. So we still use, of course, traditional forms of energy and indeed, two-thirds of our energy supplies come from traditional sources, come from coal. Indeed, it’s also worth $66 billion of exports and employs 55,000 Australians and makes sure that many other countries can be warm in winter and cool in summer and that’s necessary. But we’re meeting and beating what we said we’d do as far as our climate emissions, as far as lowering our emissions are concerned. We’re certainly meeting what we said we’d do in Paris. We’ll continue to do that and we’ll continue to, as we work towards 2050 and of course, meeting future climate targets, of course, we will make sure we do it through technology, not taxes.

WILL KOULOURIS

Now, the farmers, I suppose, over the past couple of years here in Australia have had a particularly rough trot. We’ve dealt with the bushfires, we’ve dealt with the droughts. We had the floodings earlier this year and also the issues when it does come to China. But how has the Government really been able to try and drive into other export markets in order to make sure that they have somewhere to sell their goods?

MICHAEL McCORMACK

Well, Dan Tehan is the new Trade Minister and he wasted no time in getting across to Europe, getting across to the United Kingdom, and I know he’s made himself freely available to American diplomats as well. We’ll make sure that we broaden our trade interests. We’ve got that trans-Pacific partnership agreement – $13.3 trillion opportunity right here in our backyard. And we’re making sure that we do diversify our markets. Of course, China is a big market for us – $149.7 billion of trade with China. And we also understand it’s a big world out there and we’ve got the world’s best food and fibre. Our resources are in great demand and we’ll continue to make sure we diversify our markets. Dan Tehan will continue to make sure that if there’s any other possibilities – we’ve just sent our first shipment of barley indeed, to Mexico. So, that’s something that’s a new and diversifying market example, and that’s what we’ll continue to do.

NANCY HUNGERFORD

Sir, it’s Nancy here in Singapore, and as you point out the importance of the relationship with China, your biggest trading partner here, there are concerns that the relationship is not at a very good point right now. And I just wonder how you respond to China when they say that it’s your Government that has caused – taken a series of measures that has been really the disruptive force in this relationship and accusing you of a cold war mentality. How do you respond?

MICHAEL McCORMACK

Well, we’ll let the World Trade Organisation sort out any matters or any conflicts so far as trading relations are concerned. We’ll continue to work in a diplomatic and pragmatic and practical way with Chinese officials. We’ll continue to do that. Our phones are always there if they want to talk to us, in a very bilateral fashion. Of course, Dan Tehan, the new Trade Minister – very welcoming and open to any conversations that Beijing wants to have with us as far as making sure that we smooth any relationships, that we get on with continuing to provide China with our resources of course, their steel mills need our metallurgical coal. They still need our other resources, whether it’s food, whether it’s fibre. They understand that we’ve got a great market here and we’ve got a great product and they’ll continue, I know, to support us, as we will them.

NANCY HUNGERFORD

I think part of the concern, though, is when China came out and indefinitely suspended the key economic dialogue with Australia they signalled to many that they’re not really in a mood to negotiate. What specifically are you willing to do in the Government to bring China to the negotiating table and improve this relationship?

MICHAEL McCORMACK

We’ll be patient. We always are. We’ll be patient. We’re here. We understand that we’ve got the world’s best product and I know that perhaps some of your viewers might think otherwise – we’re all very parochial and we’re all very fiercely proud of what we produce in our own countries – but I know our farmers are the best in world. I know our mining resources are valued right across the world and whether it’s rare earths, whether it’s coal, whether it’s iron ore – you mentioned that at the top of the show, our iron ore price is very strong at the moment and we’ve based our Budget on very conservative estimates about where that iron ore price might go. But, indeed, our resources are greatly valued, greatly in demand around the world and whether it’s China or any other country, we’ll work with them always in a friendly and diplomatic and responsible way.

TANVIR GILL

Good morning, Tanvir Gill joining in this conversation as well. You, India and Japan have come together – Australia, India and Japan have come together to formally launch the supply chain resilience initiative that China’s called unfavourable for the global economy. What is the plan here and how do you go about executing the supply chain lines across these three regions?

MICHAEL McCORMACK

Well, resilience is a big thing and whether it’s Japan, whether it’s India or whether it’s Australia, we all need our markets to be more resilient. We all need to bounce back. We’re in the midst of a global pandemic and of course, our hearts go out to India at the moment with what they are suffering through this global pandemic. We want to get through this. We have to get through this and as peoples of the world, we will get through this and resilience is a very, very big thing. We understand just how much we need to broaden our interests with market opportunities. But we also need to have that ability to be able to reach out to our friends, to our neighbours in the Indo-Pacific region and make sure that they know that Australia is here, Australia’s open for business and Australia will continue to trade because we understand as well as anybody that trade equals jobs and more trade means more jobs.

TANVIR GILL

Alright, on that subject, given the crisis that India is facing, how are negotiations going with the Indian authorities on restarting repatriation flights? I believe the flights start the day after. Because your Immigration Minister has said that the whole process will be very complex and will take a lot of time.

MICHAEL McCORMACK

And it will take time and we’ll always put our national interest first. But, of course, we are a country which places humanitarian efforts first and foremost and that’s why we’re always first to help when island nations in the Pacific have cyclones and other natural disasters. We’re very much conscious of the fact that we’ve got a number of Australians in India at the moment, and we speak to High Commissioner Barry O’Farrell on a daily basis. I know the Foreign Affairs Minister, Senator Marise Payne, is very aware of the problems and difficulties that India faces and that’s why in the Budget there’s more than 120 government-facilitated flights. We’re going to bring more than 17,000 Australians home over the next 12 months and we’ll continue to do that. Our Prime Minister Scott Morrison said on March 13 last year, he urged and encouraged and implored Australians if they could do so to come home. Not all Australians took advantage of that ability to do it then and of course, with the situation worsening in some countries, there is a great desire to come back to Australia now. So, we’ll continue to facilitate those flights. We’ll continue to work with commercial airlines to make sure that we get as many Australians home, whether they’re in India or anywhere else.

NANCY HUNGERFORD

Sir, we very much appreciate you joining us today and weighing in on these important issues. Thank you so much. The Deputy Prime Minister of Australia Michael McCormack with us and Will, thank you for bringing us the interview, as always.

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