Trading in Confidence: Improving Australia's Anti-dumping Framwork
Australia is a proud and thriving trading nation. While notable for its resource exports, Australia maintains a diverse trading economy with strong and growing relationships with trading partners across the world and in the Asia-Pacific region. The last decade has seen strong bi-partisan advocacy for opening Australia’s markets to the world, and has resulted in a growing number of free trade agreements with some of Australia’s largest trading partners – in particular, China and the United States. However, in order to ensure the benefits of free, open and fair trade are realised, and that confidence in the system is maintained, it is vital that appropriate safeguards are in place to give Australian producers a fair go in an increasingly competitive domestic marketplace.
Predatory dumping, or the practice of exporters flooding foreign markets with products at below-market prices in an attempt to damage competitors’ business prospects and/or clear excess production, has sparked growing concern among major Australian industries since the Global Financial Crisis of 2008-9. Products dumped in this manner range from industrial steel and glass to consumer products such as canned tomatoes and pineapples.
Despite governmental precautions designed to limit such activity – in the form of the antidumping framework – the occurrence of predatory-dumping is common. While the proliferation of global trade has real benefits for Australia’s economy and working Australians, it is important that confidence is bolstered in the system, as too often, breaches of the system the Australian government has put in place occurs.
In 2015 Australia’s two-way trade in goods and services was worth nearly $670 billion. Australia’s GDP expanded by 1.1% in the March quarter of 2016 (its biggest expansion in three years), and the economy advanced 3.1% from 2015-2016 (displaying its fastest expansion since the third quarter of 2012). Furthermore, long-term trade data identifies the average rate of Australian GDP growth at 0.87% from 1959 until 2016. It is no coincidence that in approximately that same period of time, two-way trade of goods and services increased from $6.1 billion or 28.7% of Australia’s Gross Domestic Product (GDP) to $669.2 billion, or 42.3% of GDP (1964-2014).
It is indisputable that trade is central to the future of Australia’s economy. But in order to ensure the ongoing benefits of a connected global economy are realised within Australia, the appropriate defences against unfair and illegal trading practices must be in place. The anti dumping framework provides this defence, and this report reiterates its importance to Australia’s economic future.