Queensland Liberal Senator Russell Trood is alarmed that Kevin Rudd has put free-trade agreement negotiations between Australia and its two most important North Asian trading partners into deep freeze, with millions slashed from the Department of Foreign Affairs and Trade FTA budget.

In China in April, Rudd agreed to “unfreeze what have been the frozen bilateral negotiations for a free-trade agreement between Australia and China.”

Despite this promise, $6.2 million will be cut from the FTA negotiations, which includes $4.4 million specifically to be taken from DFAT.

“Instead of unfreezing negotiations as the Prime Minister promised whilst in Beijing, this cut is in effect putting negotiations back into cold storage,” Senator Trood said.

“China and Japan are Australia’s top two trading partners, so the benefits of Free Trade Agreements to Australian industry are obvious. The Government, however, seems happy to slow the negotiation process further by decreasing the department’s resources allocated to making progress.”

In addition to the funds taken from the China negotiations, $1.1 million will be taken from various agencies involved in the Japan free trade negotiations.

“The best we can hope for now is that Kevin Rudd’s chat with Prime Minister Fukuda in Japan next week will somehow lead to a restoration of the momentum necessary to produce the high quality FTA Australia desires,” Senator Trood said.

“Negotiation of these free trade agreements will require intensive, concerted diplomatic action which will be resource intensive.

“Despite DFAT officials' assurance that their progress will not be affected by these cutbacks, it is very difficult to believe negotiations can proceed at an acceptable speed if they are underresourced.”

Senator Trood said he was concerned that given the serious challenges facing further progress in the Doha round of multilateral trade negotiations, and the likelihood that any outcome will be less favourable to Australia than originally expected, the free trade agenda looms as increasingly important.

“The Rudd government needs to recognise this and take the bilateral free trade agenda more seriously.”

* Senator Russell Trood is Deputy Chair of the Senate standing Committee for Foreign Affairs and Trade