John Menadue. Slogans vs Facts.

Sep 17, 2015

In my post of 16 September, I referred to the continual exaggeration over the benefits of Free Trade Agreements.

There has been quite a pattern of this type of exaggeration with slogans rather than facts. One example of slogans and one-liners has been the Abbott government’s claim that it ‘Stopped the Boats’. This is just not true, but the media keeps repeating the myth and the slogan. I will be writing further about that early next week.

The most recent example of exaggerations and slogans has been in respect of the China Free Trade Agreement and Free Trade Agreements generally. An article today by Mark McGovern in The Conversation outlines how ‘Free Trade Agreements fail to boost Australian Agriculture and Food Manufacturing’.  He says

Many claims are made that Free Trade Agreements (FTAs) with select trading partners will benefit Australian agriculture. OECD statistics say otherwise. The balance of trade positions of Australian agriculture and food manufacturing have deteriorated since FTAs with New Zealand, the United States and Thailand have come into play. … Clearly, these three FTAs have failed to deliver. There has been no improvement evidence in the agriculture and food trade position under any of the three agreements. Rather, deterioration has been evident in each case.

How might things change with three new North Asian trade regulation and investment agreements (Japan, Korea and China), and perhaps a Trans-Pacific Partnership? History suggests no necessary gains and trending losses on merchandise trade for both food manufacturing and agricultural industries. It seems we should be more closely monitoring the realities of trade, not fixating on rhetoric and so far empty promises.

Unfortunately the rhetoric, slogans and exaggerations continue with discussion on the Free Trade Agreement with China. That agreement will be marginally useful but its benefits are likely to be grossly exaggerated.

See link to article by Mark McGovern, Senior Lecturer, QUT Business School, Economics and Finance at Queensland University of Technology.

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