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RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC

C O N F I D E N T I A L SECTION 01 OF 03 CANBERRA 001111 
 
NOFORN 
SIPDIS 
 
STATE PLEASE PASS USTR/BELL AND USDA 
 
E.O. 12958: DECL: 11/03/2018 
TAGS: ETRD ASEAN AS
SUBJECT: DAUSTR BELL'S AUSTRALIA MEETINGS: TPP, WTO, AND 
FTAS 
 
REF: CANBERRA 903 
 
CANBERRA 00001111  001.2 OF 003 
 
 
Classified By: Acting Econcouns W Albright, reasons 1.4 (B) and (D) 
 
¶1. (C) Summary.  DAUSTR Doug Bell visited Canberra October 
19-21 for meetings with Australian trade officials and to 
discuss the Trans-Pacific Partnership (TPP).  Australia has 
begun its internal processes to gain formal approval for 
joining the TPP, which should be concluded by the end of the 
year.  An adviser to Trade Minister Simon Crean said Crean is 
interested in exploring the possibility of a WTO ministerial 
at the end of the year to hammer out modalities. The GOA 
remains pessimistic about prospects for concluding FTAs with 
Japan and China.  End Summary. 
 
¶2. (SBU) Deputy United States Trade Representative Doug Bell 
met with the full range of senior Australian trade officials 
in Canberra October 20-21, focusing on the Trans-Pacific 
Partnership and our bilateral trade relations.  Bell met with 
George Mina, Adviser to Trade Minister Simon Crean, and at 
the Department of Foreign Affairs and Trade (DFAT) with 
Deputy Secretary David Spencer, Tim Yeend (First Assistant 
Secretary, Office of Trade Negotiations), Bill Tweddell 
(First Assistant Secretary, Americas Division), Ric Wells 
(Head, China FTA Task Force and Japan Task Force), and 
Michael Mugliston (Head, Asia Trade Task Force). 
 
TRANS-PACIFIC PARTNERSHIP 
 
¶3. (C/NF) Bell, making his first visit to Canberra since 
assuming the Australia portfolio, briefed on current progress 
in the Trans-Pacific Partnership (TPP), following up on 
USTR's October 17 meeting with David Spencer in Singapore on 
the margins of an APEC meeting.  Spencer and Yeend said the 
GOA was making progress on its internal procedures to 
formally join the TPP process.  Mid-December was the latest 
they expected to have final approval.  However, Spencer said 
he thought it would be good if Australia and Peru could both 
announce they are joining the TPP during the APEC Leaders 
Meeting in Lima in late November; the GOA will try to meet 
that deadline.  Politically, Spencer said, Australia has "no 
problem" in agreeing to join the TPP; it is seen as 
"strategically sensible."  He said that some other GOA 
agencies had raised the practical concern of having to manage 
"another resource-intensive FTA", but Spencer said this would 
not stop them from agreeing.  (Spencer also pressed Bell on 
the November 15 financial summit, urging the US to invite all 
G-20 members; septel.) 
 
¶4. (C/NF) Organizationally, Yeend said TPP falls into his 
portfolio in the Office of Trade Negotiations.  Consultations 
among other GOA agencies are already underway.  The US 
decision to join was key for Australia, which had been 
watching the P4 and thought it was a "good place to start". 
He sees this as great opportunity; a quality TPP FTA could be 
a real building block to broader regional economic 
integration, possibly a path to FTAAP.  Yeend said TPP could 
allow Australia to stop conducting bilateral FTA negotiations 
by directing interested parties to the TPP instead.  Yeend 
noted the P4 agreement is good but has some deficiencies, 
such as a very short chapter on IP.  Bell noted the US had 
Qsuch as a very short chapter on IP.  Bell noted the US had 
done detailed analysis of the existing TPP covering issues 
like rules of origin, IP, and market access and told the P4 
that if the US was to join in, work to upgrade parts of the 
P4 agreement would be needed; the P4 agreed. 
 
OTHER ISSUES 
 
¶5. (SBU) In meeting with the Americas Division, in addition 
to discussing the TPP, Bell flagged US interest in 
cooperating with Australia on illegal logging, noting the US 
program in Indonesia and the Australian program in Papua New 
Guinea.  First Assistant Secretary Bill Tweddell thought 
greater cooperation on this made good sense.  Bell also 
stressed US interest in the Australian government review of 
its quarantine arrangements which is expected out shortly, 
 
CANBERRA 00001111  002.2 OF 003 
 
 
and said we would follow it closely and be interested in 
discussing in the future. 
 
WTO 
 
¶6. (SBU) In a meeting with Trade Minister Crean's adviser 
George Mina, Mina urged the US to consider a ministerial 
meeting on modalities in between the late November Indian 
elections and the seating of the new US Congress in early 
January.  Mina said Crean thought progress could be made that 
would make it clear the Doha Round is still viable.  He also 
urged the US to be more open on agricultural reforms for the 
"demonstration effect" it could have on countries such as 
Japan.  Mina said Crean was positive on the TPP, and thought 
it represented "the most viable" path to an eventual FTAAP. 
 
JAPAN 
 
¶7. (C/NF) Ric Wells, the head of the FTA Task Forces for both 
China and Japan, was pessimistic about both.  Wells said he 
has a "jaundiced view" after 18 months of negotiating with 
Japan, where good progress has been made on goods market 
access but no progress at all has been achieved on 
agriculture - and Wells can't imagine how any movement on 
agriculture will be forthcoming without sweeping changes in 
Japan's Ministry of Agriculture, Forestries, and Fisheries 
(MAFF).  Wells admitted that Australia may not have clearly 
thought through the prospects when FTA negotiations were 
proposed.  The GOA's positive experiences in negotiating its 
earlier FTAs with the US, Thailand, and Singapore may have 
led them to be overly optimistic about prospects with Japan. 
He noted that political considerations may have been a factor 
in deciding to proceed on both sides.  In any case, Japan was 
certainly aware that Australia and China were negotiating an 
FTA and was likely a factor in their thinking.  METI and MOFA 
are serious about trying to find ways to resolve the FTA, but 
MAFF has given no ground at all.  The initial Japanese offer 
excluded 80% of Australia's agricultural exports - "they 
didn,t try at all".  Now Australia is waiting for Japan's 
elections, but Wells admitted that neither side really knows 
how to conclude this FTA. 
 
¶8. (SBU) In response to Bell's question about non-tariff 
barriers in Japan, Wells said Australia's experience was 
different from that of the US.  Agricultural NTBs have been a 
problem - but many Australian agricultural producers have 
developed new products specifically for the Japanese market 
that meet Japanese standards.  Australian manufacturing 
exports to Japan have never been large, and Australia,s 
services sector has "given up" on Japan (although the pension 
funds management sector, with extensive domestic experience, 
is trying to get into Japan) and is focused on China. 
 
¶9. (C/NF) As for Japan and the TPP, Wells said it was hard to 
believe Japan would be seriously interested in participating 
in the TPP, given agriculture and the low quality of Japan's 
bilateral FTAs.  It would take external pressure - for 
example, Korea joining - to overcome its reluctance and make 
Japan feel it has to "do something" to avoid being isolated. 
In general, it is a good time to push Japan; they are more 
aware that something has to change in their system.  There is 
Qaware that something has to change in their system.  There is 
more support in Japanese industry for reform, and an 
Australia-Japan FTA could be a channel for that.  But again, 
MAFF "doesn't give a stuff", and remains focused on their 
main job, delivering votes to the ruling party. 
 
¶10. (C/NF) On China, Wells noted there was interest on both 
sides in restarting talks, but he didn't see any prospect of 
immediate progress.  Australia has given China a list of NTBs 
and is trying to negotiate on them.  China is "being 
obdurate" and insists that NTBs and standards shouldn't be 
covered by an FTA.  Wells touched on the issue of Chinese 
state-owned enterprises investing in Australia.  There has 
been concern about that - but now, with the global financial 
turmoil, that is the only investment coming into Australia, 
so concerns have lessened.   Overall, Australia is trying to 
 
CANBERRA 00001111  003.2 OF 003 
 
 
conclude as many FTAs in Asia as possible to preclude being 
excluded by the ASEANs from any new regional architecture. 
 
MALAYSIA, ASEAN 
 
¶11. (SBU) Bell and Michael Mugliston traded updates on the 
status of our respective FTA negotiations with Malaysia. 
Mugliston said Malaysian trade minister Muhyiddin and Simon 
Crean had agreed earlier in October to resume talks.  DFAT 
trade consultant Phil Sparkes noted that Malaysia has a poor 
track record in actually concluding FTAs. 
 
¶12. (SBU) Mugliston described the economic cooperation MOU 
that will be signed at the same time as the Australia-New 
Zealand-ASEAN (AANZFTA) in December (ref A).  DFAT and AUSAID 
worked on an A$20-25 million work program to help the ASEAN 
secretariat implement the provisions of AANZFTA.  Malaysia 
has asked for similar assistance as part of the bilateral 
FTA, but they are not eligible for ODA from Australia. 
Mugliston suggested Bell speak to the New Zealand trade 
negotiators - they had a narrower focus than Australia in 
AANZFTA, and didn't push Malaysia much in negotiations. 
 
MCCALLUM