Dr CHALMERS (Rankin) (11:26): I second the motion. I rise today to speak on the private member's motion on Australia's relationship with Japan, the context of which is the planned visit by Prime Minister Abe next month. The Japan-Australia relationship is absolutely crucial for our nation. Japan is our second-largest export market and our second-largest trading partner. It accounts for almost 17 per cent of our exports. It is worth almost $48 billion, comprised mostly of LNG, coal and beef. But Australia's relationship with Japan goes much deeper than trade, as important as that is. Our cultural ties are as close as with any other in the region. Given history over the middle of the last century, it is remarkable how strong our friendship has become based on democracy, human rights and the rule of law.
In the aftermath of the earthquake and tsunami in 2011, Australia provided extensive support to our Japanese friends. Former Prime Minister Julia Gillard was the first head of government to officially visit the region after the disaster. Among other things, she, on behalf of the government at the time, offered Japanese university students, academics and professionals from the most affected areas funding to spend time in Australia.
We want to see this friendship strengthened even further in trade as well, with the best possible economic partnership agreement with Japan. We come to these negotiations with an open mind, but the overview released in April of this year did leave us with some questions. So the opposition will reserve judgement about the merits of the agreement until full details have been released publicly. But this process will be made a bit more difficult due to the revelation at Senate estimates earlier this month that the government has not modelled the impacts of the proposed deal—in contrast with the precedents from the Korean FTA and from past trade negotiations.
The opposition would be keen to support a high-quality deal with Japan. We would be firmly in support of a deal that creates jobs and other benefits for Australian consumers, workers and businesses. But we need to be sure that the government, in a short time frame since coming to office, has not sacrificed quality for speed in finalising this deal with Japan. Achieving real progress on deeper integration with Japan and other neighbours can be the key to developing a stronger and more resilient regional economy into the future.
The McKinsey Global Institute has done us a great service quantifying the benefits of international connectedness in their recent report on global flows in a digital age. Around the world, flows of goods, services and finance in 2012 reached $26 trillion or 36 per cent of global GDP—one and a half times larger than they were in 1990. Their report also determined the dollar value of the contribution of global flows to GDP growth, adding somewhere between $250 billion and $450 billion to global GDP each year or 15 per cent to 25 per cent of growth. This gives evidence to what we know intuitively; that trade liberalisation can create opportunities when it is done right.
There is one disappointing part of this motion and that is the member for Cowan's predictable partisan references to the minerals resources rent tax and the carbon price. It just goes to show that the members on that side of the chamber often cannot help themselves. Even on issues of great international importance like a trade relationship that has been supported by both parties for many years and advanced by my fantastic predecessor Dr Emerson, the member for Cowan cannot help but include some domestic political pointscoring.
There is form in his party for this of course, with the Prime Minister regularly using the international stage to play domestic politics. What is particularly stupid about the member for Cowan's claims about sovereign risk in this motion is that they are founded on a fallacy. Before it was politicised in this way—and the member for Fraser will know this—sovereign risk referred to the likelihood of a government defaulting on bond payments. Given that under the last government Australia had stable AAA ratings from all three of the major credit ratings agencies, a feat never achieved under Peter Costello or any other Liberal Treasurer, it is clear that Australia's sovereign risk was and remains an insignificant factor for countries intending to invest here.
I sincerely hope that the members on that side of the chamber are able to maintain their dignity when we are honoured, absolutely honoured, with a visit from Prime Minister Abe next month. He will be the first Japanese leader, as the member mentioned, to address a joint sitting of the parliament and one of a very select few of international leaders to be given that privilege and that opportunity. I look forward to his visit. All members on this side of the chamber look forward to his visit and to Australia enjoying the benefits of the closer relationship, economic and cultural, in the years ahead.