Interview with CNBC

12 Nov 2018
Prime Minister
International summits; China; Newspoll; Economic growth

MATT TAYLOR - HOST: The Australian Prime Minister Scott Morrison is joining us now live from his office in Sydney. Prime Minister great to see you there and thanks for joining us. I mentioned you’ve got a busy week coming up, trips to Singapore, Papua New Guinea. What is going to be top of your agenda  as you head into these meetings? Will it be focussing on trade and in particular a free trade agreement between Australia and Indonesia?

PRIME MINISTER: Well, I think there are three primary focuses. The first one I think is to articulate and talk through the announcements we made last week and the week before in terms of our commitment to the Pacific. Australia is obviously a principal participant in the Pacific and we’re stepping up our involvement there, both strategically and economically and socially as well. It’s always been a very important part of the world for us and we’re significantly expanding what we’re doing there in partnership with many other countries – whether it’s the US or whether it’s China or other countries. That will I think, be an important part of the discussion, particularly when we’re up in Papua New Guinea for APEC.

Trade always, any time an Australian leaves our shores in service of the Government – whether as a Prime Minister or a trade official – we are always the ones who are advocating the need for greater open trade and liberalisation around the world, that’s what our record has always delivered and that has, I think, always improved prosperity throughout the region. So you will always find us as the lead advocate for open trade. Thirdly, issues of security, whether it’s dealing with returned foreign fighters or dealing with cybersecurity where there’s increasing threats in that space and in that realm and working together to combat those in partnership. So these are three key areas of my focus and that’s what I’ll be pursuing.

TAYLOR: It’s your first big round of talks, first big round of summits since you became Prime Minister. What would be your message to other world leaders that you speak to and indeed international investors that are watching now, worried about the constant churn of prime ministers and leaders in Australia and the perceived risk that people outside have, looking into Australia, of political instability?

PRIME MINISTER: Well, I think that all of that is overstated and Australia’s policy and priorities and our agenda remains exactly as they have been since we were first elected in 2013 and that is always been to pursue a strong trade agenda, a strong economic agenda, infrastructure investment, a very significant investment in lifting our defence capability to two per cent of GDP, we remain on track, in fact, we’ll hit that three years ahead of our original target so there’s a continuity and a stability in the policy agenda being pursued by our Government and we’re getting very strong results – whether it’s our economy, which hit 3.4 per cent growth, is higher than the developed world, particularly the G7, the fact that our Budget is actually returning to balance next year and that is on track to be achieved and our jobs growth record in Australia as a Government is second to none and has been heavily successful so we’re just getting on with it and the program that we’ve been outlining we’ll be continuing with our partners.

ORIEL MORRISON - HOST: Prime Minister, it’s Oriel here in Singapore, such a pleasure to have you with us this morning. I want to delve more into what you’re doing in Australia in just moment. But first of all, to go back to what you were talking about a little bit earlier when it comes to foreign relations. International relationships in particular with your biggest trading partner which is of course China, right now in the midst of a trade spat with the United States. It has not always been an easy relationship, the one between Australia and China, what is your next conversation with Chinese officials going to entail?

PRIME MINISTER: Well obviously they’ll be subject to the internals of those discussions. But our approach is very much about getting on with business with China. As you say, they are our major trading partner. They’re increasingly invested in Australia and across a whole range of different areas of our industrial sectors. At the same time we maintain a very positive and longstanding relationship with the United States. So I think we’re in a bit of a unique position to be able to, I think, to deescalate any issues. That’s always been our approach because regional stability is important for regional prosperity. That’s why we don’t involve ourselves in any of the territorial disputes, we don’t take sides on those things. Those positions have been set out by Australia for some period of time. So we don’t take any sides in those types of disputes whether it’s in the South China Sea or elsewhere.

MORRISON - HOST: So how does Australia then get involved when it comes to issues like the trade spat that I mentioned earlier, between the US and China and you’re talking about Australia sitting on the sidelines, when it comes to territorial disputes as well. Well, what about the South China Sea, does Australia need to take a stronger position on issues like the South China Sea? I mean obviously it’s something that has been discussed over the last few weeks in Australia and your Defence Minister has taken a very strong position on it?

PRIME MINISTER: Well look, there are claims and counterclaims and there have been processes and we’ve observed those processes. But we don’t take sides on those particular competing claims. But at the same time, our policy is expressed through the freedom of navigation exercises and other things we have done in transiting through the region. That’s done I think in a very transparent and respectful way and we just continue to maintain our dialogue and the investment continues to flow, the business continues to run and we’re able to I think, engage in a very constructive partnership. We have a Comprehensive Strategic Partnership at official status with China and that’s something we take very seriously and we work very hard to on to maintain.

TAYLOR: You are of course heading into an election in Australia in 2019, your predecessor Malcolm Turnbull essentially broke his silence last week since he was removed from the top job, saying that decision to oust his was self destructive for the Government. The latest Newspoll out in the last 12 or 24 hours shows that you’ve got your work cut out for you, you’re trailing the Opposition party by about ten percentage points. How are you going to arrest any further slide and what would be the top priority for you in terms of communicating your Government’s performance to the electorate as we move into that critical election period next year?

PRIME MINISTER: Well I think it’s very reasonable to say that we have got a big job ahead of us. That’s no surprise under the circumstances of several months ago.

But the Government has a clear agenda to ensure we have a strong economy because we understand that it is the strong economy that supports the services and infrastructure that are necessary to provide the way of life and the standard of living that Australians enjoy. Now on top of that, keeping Australians safe is critically important and the terrorist incident we had here in Australia just on Friday, is another reminder that these issues are never far away. We need to be constantly vigilant and this is why we also work closely with our regional partners on these issues. There is a very strong focus from our Government to keep Australians together and what I mean by that is industrial harmony. Our Government is not going to take Australia back to some of the chaos of industrial disputes of many, many years ago. That is not a place that our Government wants to take our industrial settings in Australia. We’ve always sought to improve them and that’s been a key to our prosperity. So our message to Australians is very straightforward, and that is a stronger economy delivers the services and the essentials that they rely on for their standard of living.

We’ve got a great track record of economic management and growing a strong economy; record jobs growth and at the same time bringing the Budget into balance - which is an economic and financial management achievement which I know is very important to Australians - and maintaining our AAA credit rating under the period of one of the most extreme pressure that we’ve seen in our country.

MORRISON - HOST: Are you convinced that you will indeed be able to do that, Prime Minister, when it comes to growth in Australia? Once again, if you look at the big picture, you look at the macro issues out there that are facing the global economy at the moment, global markets, there is a lot of concern about a potential slowdown for the world economy, not just purely Australia to deal with. When you look at the global picture are you convinced that Australia is going to remain strong in the face of a potential economic slowdown?

PRIME MINISTER: Well I am, because that has been our track record. We are now in 27 years of continuous economic growth and the last five years have been a very hard slog. For many other countries the global financial crisis was the key economic event that impacted the performance of their economies. In Australia that was not the case. At that time, we were going into the upside of a mining investment boom and there was a very strong growth out of China. Now, on the other side of the mining investment boom we had more than $80 billion ripped out of our economy as investment in that sector fell. That had a very significant impact on our economy - yet through that we continued to grow, we continue to restore our budget position and we maintained our AAA credit rating all the way through under that pressure. So we’ve got good form I would say. Yes there are lots of uncertainties and lots of challenges out there well beyond our shores, that’s why we have pushed and achieved the free trade agreements that we have with China and South Korea and Japan and they are critical. I mean Prime Minister Abe will be in Australia soon and I will be meeting with him here in Darwin and continuing to work on the defence arrangements and other issues that we have been working with them. We have got a great programme which has been getting taxes down in Australia, getting investment up, expanding our markets and investing in critical public infrastructure. Our public infrastructure program - whether it is the Western Sydney Airport, or now working on the major Tullamarine airport line between the Melbourne CBD and our major airport, major pumped hydro projects in the Snowy Mountains - these are big, big infrastructure projects which have been supporting the strength of our economy during what has been a testing time.

JOURNALIST: Prime Minister just before we let you go, when can we expect the next election to be called?


JOURNALIST: Next year 2019, any more specific than that?


MORRISON – HOST: Always worth a try. Prime Minister such a pleasure to have you here on Street Signs with us on CNBC. Thank you so much for chatting to Matt and myself.

PRIME MINISTER: Thank you Matt, thanks Oriel.