Trade links can fight terrorists
February 24, 2005
MORE open trade links between Australia and the Asia-Pacific can play a major role in fighting terrorism throughout the region, Treasurer Peter Costello said today.
Trade liberalisation was one of the best ways to foster economic growth and raise people’s living standards, Mr Costello said.
"Chronic weakness and poor governance can produce social disorder, erode faith in institutions and, over time, can create an environment where transnational crime and terrorism can flourish," he told the Macroeconomic Policy and Structural Change in East Asia Conference in Sydney.
"We must join together to promote economic strength and good governance so that this does not happen.
"Trade liberalisation is one of the best mechanisms to achieve growth and poverty reduction, thereby raising living standards."
After signing a free trade agreement (FTA) with the US last year, Australia is keen to seal similar deals with countries across the Asia-Pacific region.
Australia has begun work on a feasibility study on a possible agreement with China, and has started talks about a deal between Australia, New Zealand and the 10 member countries of the Association of South-East Asian Nations.
Australia has also negotiated trade agreements with Singapore and Thailand, while talks are under way with Malaysia.
Australia wanted to ensure its trade agreements acted as building blocks to a more multilateral system, Mr Costello said.
"Multilateral liberalisation should be the ultimate goal," he said.
"FTAs are an important contributor to liberalisation when multilateral progress is being stymied.
"But they will never replace the need for multilateral progress."
Earlier, Treasury Secretary Ken Henry told the conference there were big opportunities for all economies in increasing their openness.
"Our success in securing the most sustainable growth possible in our economies depends in no small part on efficient and open cross-border trade and investment," he said.
Countries across the region also needed to be mindful of the extent of imbalances in savings and investment, Mr Henry said.
While the region was a major exporter, it had an excess of saving over investment, resulting in many countries enjoying current account surpluses rather than deficits, he said.
"This matters because inward investment provides valuable support for economic development and growth," he said.