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Australia's Federal Gov't Fears Trade Retaliation

by Mary Swire, Tax-news.com, Hong Kong

15 August 2017


Australia's federal Trade Minister has warned that billions of dollars of exports and thousands of jobs are at risk from the Queensland Government's new state procurement policy.

Last month, the Queensland Government announced a "Buy Queensland" procurement policy, which will apply across all agencies, statutory bodies, and government-owned corporations.

From September 1, 2017, this policy will define a "local supplier" as a business that maintains a workforce within a 125km radius of where the goods or workers are needed. Local suppliers will receive a local weighting of up to 30 percent on any tender lodged for a significant procurement. At least one local or regional supplier, and one other Queensland-based business, must be invited to quote or tender for every procurement opportunity offered.

According to a statement from the Queensland Government, the Cabinet "has agreed the state Government would no longer be constrained or bound by free trade agreements that have seen jobs go offshore or interstate."

Premier Annastacia Palaszczuk also said that Queensland will "ignore restrictions that go against our interests."

In a statement condemning the policy, federal Trade Minister Steven Ciobo said that the Queensland Government intends to intentionally breach Australia's trade agreements, a move that would put both existing agreements and those under negotiation at risk.

Ciobo said: "This reckless behavior by the Palaszczuk Labor Government poses a serious threat to Australia's farmers, cattle producers, grain growers, winemakers, manufacturers, miners, and all those who sell Australia's products and services to the world."

According to Ciobo, if Queensland breaches Australia's free trade agreements, the country's trading partners could retaliate and increase barriers to trade.

He called on Palaszczuk to "immediately dump her disastrous policy and end the trade war she is trying to start."

TAGS: business | free trade agreement (FTA) | export duty | trade treaty | Australia | offshore | agreements | import duty | trade | services | Work

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