Josh Frydenberg will argue for reform of major international economic institutions including new trade dispute rules and greater input for “emerging” Asian economies in a speech to be delivered on Tuesday at the Australian National University.
In excerpts of the speech, seen by Guardian Australia, the treasurer calls for Australia to play an “active and constructive role” in international affairs and praises global economic institutions, in contrast to Scott Morrison’s controversial criticism of “negative globalism”.
Frydenberg says that Australia needs to help recapture the spirit of Bretton Woods, when international economic institutions created after the second world war laid the groundwork for decades of prosperity.
Australia should ensure that “globally we remain a strong advocate for a transparent and rules-based global economic system that has strong multilateral institutions”, Frydenberg says.
“Today, Australia wants to see the [World Trade Organisation] reinvigorated with a more effective dispute settling mechanism and a broader remit to deal with e-commerce and the opportunities created by the digital economy.
“So too with the [International Monetary Fund], we would like to see change to the governance structures reflecting the greater role played by emerging economies, particularly in Asia.”
Australia has been caught in an escalating trade war between China, its biggest trading partner, and the US, its biggest source of foreign direct investment.
The trade minister, Simon Birmingham, has argued that while Australia agrees with the US on the substance of problems including intellectual property theft by China, Australia does not approve of punitive tariffs as a means to resolve the dispute.
On his trip to the US in September, Morrison called China a “newly developed” economy, conferring developed-world obligations on the Chinese leadership. The speech prompted outrage from China.
In October Morrison declared sovereign nations need to eschew an “unaccountable internationalist bureaucracy” and the world needs to avoid “negative globalism” in a major foreign policy lecture at the Lowy Institute.
The Department of Foreign Affairs and Trade was not consulted before either speech and senior ministers have struggled to explain who the “negative globalists” might be – although Morrison has pointed the finger at the United Nations and Frydenberg has cited UN criticism of Australia’s harsh policies on asylum seekers as an example.
On Tuesday Frydenberg will say that “given Australia’s strong strategic, political and economic ties with key partners both near and abroad, we are well placed as a nation to play an active and constructive role”.
“We need to reclaim that spirit as we pursue multilateral and plurilateral arrangements that embed the concept of openness in their rules and norms and support a broader rules based order.
“That’s why we’ve signed free trade agreements with our largest trading partners.”
Frydenberg praises the fact that 70% of Australia’s two-way trade in goods and services occurs with countries with which it has a free trade agreement, including the Regional Comprehensive Economic Partnership struck last week.
The treasurer argues that an ageing population in Asia provides both opportunities “as the shape of the goods and services we consume change” but will also “give rise to challenges as workforces start to shrink in some nations”.
By 2050, the proportion of people aged over 65 in eastern Asia will have more than doubled to 55 out of every 100 people, he says, higher than the global average of 32.