Labor Flirting with Neo-Protectionism in Trade Policy
Wilson, Tim, Review - Institute of Public Affairs
It is only early days, but the Rudd government's pro-growth reform credentials are already being put to the test. Since the 1980s, both major parties have favoured free trade. At the last federal election, then Shadow, now Minister for Trade, Simon Crean, committed a Rudd government to a trade policy overhaul that would promote Australia's economic interests.
In its election policy 'A strong future for Australia's exports' the ALP complained that the Howard government had failed to make the most of an expanding world economy and resources boom. Now in government, Minister Crean is expected to start delivering on the detail of his policy.
Included in Labor's trade policy is a review of the effectiveness of Australia's 'export policy and programs', including a flagged expansion of the Export Market Development Grants program. The EMDG is a boondoggle for small businesses who want a risk free opportunity to break into new markets through government subsidies-the sort of policy Australia opposes in the World Trade Organisation because they undermine free trade.
Another review includes the effectiveness of existing bilateral free trade agreements (FTAs). In its policy the ALP committed to 'commission[ing] independent research to determine the effectiveness of existing FTAs and Regional Trade Agreements in delivering net benefits for Australia and to set benchmarks for future agreements'. …