Australia targets vaccine nationalism and carbon tariffs on European tour

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Australia will ask the EU to lift export restrictions on vaccines and drop a plan to introduce carbon tariffs on imports from outside the bloc in high-stakes talks due to begin on Monday.

Dan Tehan, Australia’s trade minister, told the Financial Times that he would warn his European counterparts about the dangers of introducing protectionist measures as the world seeks to bounce back from a coronavirus-induced recession.

He will also try to re-energise talks on an Australia-UK free trade deal, which have stalled over concerns in London about opening its market to Australian farm imports.

“Ultimately the world will go backwards if protectionism runs rife following this Covid-19 pandemic,” said Tehan, who will meet his counterparts in Germany, France, Brussels and London in the coming days.

“I think all of us now need to be stepping up and making sure that everything we do takes a liberalising approach rather than a protectionist approach.”

Canberra has blamed the EU for delays affecting 3m doses of the Oxford/AstraZeneca vaccine, which have severely disrupted the country’s inoculation programme. It has also undermined Australia’s efforts to distribute vaccines to Papua New Guinea, a Pacific neighbour suffering a deadly wave of Covid-19.

Tehan said in an interview that “vaccine nationalism” made global efforts to combat the pandemic “fraught” and difficult to plan. Canberra wanted to discuss with the EU and World Trade Organization how countries could work together to boost vaccine production.

Dan Tehan, Australia’s trade minister, said he also planned to confront Brussels over planned carbon border tariffs, which he described as ‘in no one’s interest’ © EPA-EFE

Brussels said it had only blocked a single shipment of 250,000 doses of AstraZeneca vaccines to Australia on the basis that the company had not fulfilled its contractual obligations to the EU. It denied playing a role in disrupting the export of 3m vaccines to Australia.

However, Tehan said Brussels had sent signals to AstraZeneca that any further applications for exports of vaccines outside the bloc would be rejected.

“They’ve [AstraZeneca] been encouraged not to apply and that has meant that 3mn doses that we thought we had contracted for haven’t arrived here in Australia,” he said.

He added that New Zealand’s trade minister had phoned him to say he could speak for Wellington as well on concerns that “vaccine nationalism” would hurt the entire Pacific region.

Tehan will also use his first trip to Europe as trade minister to lobby his counterparts to drop plans for a carbon border adjustment mechanism. The scheme is intended to increase the cost of imports from non-EU countries that have not signed up to the Paris climate goals or committed to net-zero emissions. Supporters said it was critical to preventing “carbon leakage”, whereby one nation’s attempts to cut emissions push fossil fuel use elsewhere.

Canberra, which has refused to commit to net-zero emissions by 2050, is concerned the measures could hit Australian exporters.

“Carbon border tariffs will be used as protectionist measures and that’s in no one’s interest,” said Tehan, who defended Australia’s environmental record, adding that it had met its targets under the Kyoto and Paris climate pacts.

“We should be looking at very positive ways to deal with this through liberalisation and through reducing tariffs on environmental goods and services rather than seeking to put additional tariffs in place.”

Tehan said he also wanted to advance talks on a free trade deal with the UK, which had failed to meet his predecessor’s target of an agreement by the end of 2020.

He said negotiators needed to be more ambitious and move beyond debates over animal welfare standards, a big issue in opening access to the UK market for Australian farm products.

“What we want to make sure is the free trade agreement is about actually liberalising market access for agriculture, rather than being a debate on who’s got the best standards,” he added.

“Given the current structures of both our economies, in many ways the UK has more to gain from the full liberalisation of goods and services than Australia does.”

Video: Covid-19 and the business of vaccines

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