Global Trade Watch – FTA Article

Latham Faces Showdown On Free Trade

January 6, 2004, Australian Financial Review, By Mark Davis

Federal Labor faces a showdown over free trade as left-wing and union delegates to the ALP's national conference this month push to reverse the party's commitment to cutting tariffs and other trade barriers.

The hardline "fair trade" policy drawn up by the left-wing Australian Manufacturing Workers Union is being pushed as an alternative to a pro-free trade platform proposed by Labor's federal front bench .

It calls on Labor governments to freeze Australia's existing tariffs and in effect rules out bilateral free-trade deals such as the one being pursued by the Howard government with the United States.

The rival trade platforms are set to trigger an intense debate at the conference, testing new Opposition Leader Mark Latham's pro-market policy credentials ahead of this year's federal election.

Labor's national conference will be an opportunity for the opposition to make up ground against the government.

Prime Minister John Howard yesterday hinted that he might be busy fighting an election campaign in October, playfully declining an on-air invitation to watch cricket in India that month.

Labor's main Left factional leader supporting the "fair trade" platform, the AMWU's national secretary, Doug Cameron , said yesterday he would meet Labor's trade spokesman, Stephen Conroy , to see whether it was possible to negotiate a compromise.

But Labor needed to put the interests of ordinary working people ahead of its ideological commitment to free trade.

"The Labor Party has been part of the political consensus in Australia that you go for free trade no matter what and I don't think there has been sufficient critical analysis of the pros and cons of free trade within Australia," Mr Cameron said.

Senator Conroy said he expected a robust debate over the trade issues, something that was welcome as Labor put together its new platform.

"But the Labor Party has been a supporter of free trade for over 20 years and I don't expect the conference will turn its back on the economic benefits that have followed from free trade over that time," Senator Conroy said.

Mr Cameron said the main leaders of the ALP's Left, which has about 42 per cent of the votes at the 400-delegate national conference, backed his alternative trade platform.

A similar debate at the ALP's 2000 conference saw right-wing and other pro-free market forces inside the Labor Party narrowly defeat a push to water down the party's commitment to free trade.

But at this year's conference it is possible some delegates from right-wing manufacturing unions could vote with the Left on the trade issue as continuing international competition is putting a squeeze on local manufacturing jobs.

The "official" draft section of the Labor platform on trade, drawn up by Senator Conroy, strongly commits the party to pursuing freer trade through multilateral, regional and bilateral negotiations and contains only minor changes to the party's existing trade platform.

But Mr Cameron's alternative draft completely rewrites the platform's trade chapter and dumps the language of "free trade" in favour of committing Labor to "fair, equitable and transparent trade".

Mr Cameron's 12-page draft platform would reverse Labor's shift under Bob Hawke and Paul Keating away from industrial protectionism and towards free trade by: Barring a Labor government from making unilateral cuts to Australian tariffs and other trade barriers as the Hawke-Keating Governments did in the 1980s-1990s. Calling for Australian tariffs on imports to be frozen at current levels. Ruling out, in effect, bilateral free-trade agreements such as the Australia-US free-trade agreement as an alternative to multilateral trade liberalisation. Watering down Labor's existing commitment to extending the Closer Economic Relations trade agreement with New Zealand. Committing Labor to pushing for reforms to the World Trade Organisation including requirements that multilateral trade deals should include undertakings by countries to enforce minimum employment and environmental standards.

The AMWU-Left draft platform reflects the stance of the anti-globalisation movement, which argues that trade liberalisation has inflicted economic and social damage on workers in developed countries while failing to deliver benefits of economic growth and development in poor countries.

"Social, especially labour and environmental concerns, must be placed above the principle of free trade," the draft says.

The looming contest over trade comes as the ALP national conference is also expected to hear a strong debate over Labor's policy on refugees.

A cross-factional "Labor for Refugees" group is asking conference delegates to back changes to Labor's immigration policy, including scrapping mandatory detention of asylum seekers, apart from an initial brief period of detention for carrying out health and security checks.

And Labor's workplace relations spokesman, Craig Emerson, has drafted a new employment chapter of the platform, which would commit Labor to winding back casualisation of the workforce and give the Australian Industrial Relations Commission more power to arbitrate in industrial disputes.

DIGGING IN

From the official draft trade platform prepared by Labor's leadership group

* We support free trade as a means of generating the growth necessary for enhancing the living standards of everyday Australians.

* Labor will continue to pursue sensible trade liberalisation through effective multilateral strategies reinforced by bilateral negotiations. The direction Labor pursued in the 1980s and 1990s of internationalising the economy and reducing protection cannot and should not be reversed.

* Labor supports the timely and successful completion of the World Trade Organisation's Doha round. The Doha round must be as comprehensive as possible and include a substantial lowering of global agricultural trade barriers.

From the Left's rival "Fair Trade" draft platform

* In many countries, including Australia, corporate globalisation has resulted in downward pressure on working standards, cutbacks on government services, job losses and efforts to deny workers fundamental rights.

* Labor supports a system of increased trade which is fair, equitable and transparent.

* Labor will not seek to enter bilateral agreements without thorough social, political and economic analysis of the costs and benefits of such agreements and extensive community consultation.

* Social, especially labour and environmental concerns, must be placed above the principle of free trade.