Interview with Stephen Engle and Haidi Stroud-Watts, Bloomberg Television
STEPHEN ENGLE:
Jim Chalmers, he's the Australian Treasurer and he joins me right now. So you're here ahead of the Prime Minister, who’ll be arriving later today for the Leaders’ Summit. What's been top of your discussions right now? What is the top issue? I can guess probably what it is but what have you been pushing?
JIM CHALMERS:
The defining issue in the global economy is obviously the chaos in energy markets brought about by Russia's war in Ukraine and what that means for inflation and what that means for the blunt and brutal application of interest rate rises. So for Australia, we're obviously engaging, collaborating, cooperating with our colleagues and counterparts. Most people are expecting a pretty bumpy ride in the global economy. It's a hostile and high‑risk environment right now, and so the more that we can engage, cooperate, collaborate on some of these big challenges ‑ whether it's inflation, making sure our budgets are more responsible, our economies are more resilient. We're rebuilding our buffers against all of this uncertainty at the same time as we act meaningfully on pandemic preparation, climate change, managing debt, particularly for vulnerable countries. That's what these discussions are all about.
ENGLE:
So aside from the issues with the war in Ukraine, there can be common ground on these climate change issues, food prices and the like ‑ that's what Sri Mulyani told me yesterday. But again, a communique is unlikely simply because you cannot find consensus on verbiage on Russia and Ukraine.
CHALMERS:
It's no secret to anybody that G20 and multilateralism more broadly is under extreme pressure right now, primarily because of a war in Europe. That's no surprise. We shouldn't pretend otherwise. It's putting extreme pressure on the system. And so I pay tribute to Ibu Sri Mulyani for her efforts and the efforts of the President here as well for keeping the show on the road when it comes to the G20. We are making progress in areas like the pandemic fund, in areas like climate change and in other areas as well, despite the pretty serious geopolitical tensions brought about by Russia’s actions.
ENGLE:
So what needs to be done next on the big hot button issue in Australia to keep gas prices lower? All options are said to be on the table. It's been a few weeks since you gave your Budget. You talked about some pretty dire increases in gas prices for the rest of this year and next year. What options are being discussed right now?
CHALMERS:
So the chaos in energy markets is the defining challenge for Australia and for a lot of countries represented here at the G20. What we've said is that we are contemplating intervening in our domestic energy market in ways that we wouldn't have contemplated in earlier years. And that's because we do have a big temporary spike in prices, which is putting at risk a number of our industries, but also making life harder for ordinary Australians. And so we are considering a regulatory intervention as our first priority, but leaving all the options on the table because we can't have a situation where some of the quite dire forecasts for energy prices play out that will be too tough for our industries and for our people.
ENGLE:
My colleague Haidi has a question, but really quick: when does a decision need to be made on whether you do export controls, price caps or direct assistance to households?
CHALMERS:
We've said that we'll have a regime in place by Christmas, but it's important for me to send a signal to our international partners that what we're trying to do here is to act without causing any problems for our trading relationships which are very important to us.
HAIDI STROUD‑WATTS:
Treasurer, it is Haidi here coming to you from Singapore today, I am wondering Prime Minister Albanese has met with Li Keqiang briefly on the sidelines of ASEAN. There's no talk about a leadership summit yet. Is this potentially in the works given that Foreign Minister Wong has laid much of the groundwork in her meetings and conversations with Wang Yi? Would you characterise this relationship as improving?
CHALMERS:
All of our efforts are into making the relationship between Australia and China more stable. The Prime Minister's schedule hasn't been finalised yet for the next couple of days, but we've made it very clear that we think engaging in a calm and considered and respectful and meaningful way would make a contribution to stabilising this relationship. I think it's in everybody's interest for our region to be peaceful and prosperous and stable and secure. So to the extent that we can engage to help ensure that we're obviously very interested in doing that. And to the extent that we need to stand up for our national interest when it comes to things like trade restrictions, we'll do that too.
ENGLE:
Do you think the relaxation, or at least a slight relaxation of COVID‑zero, the quarantine has been reduced and the indication that it could be relaxed further, does that give you optimism that at least trade and the interpersonal relationships could help improve that soured relationship between China and Australia?
CHALMERS:
One of the reasons why the Chinese economy is slowing is because of these COVID restrictions and that has big implications for Australia. And so we obviously monitor that really closely. We don't pretend to take domestic decisions about COVID management on behalf of other countries, but the Chinese slowdown is having big implications for us. We would like to see as part of the stabilising of the relationship, some of those trade restrictions lifted. That's a priority for us because it's important for our economy. But if you take a step back and look right around the world, you've got the war in Ukraine, energy prices and food prices. You've got the COVID‑related slowdown in China putting pressure on our supply chains. The responsibility on countries like Australia, which we take seriously, is to try and rebuild our buffers against that. That means a more responsible budget, and I handed one down at the end of last month, and it means a more resilient economy but it also means engaging with partners as we all confront in one way or another, these difficult global circumstances.
ENGLE:
Jim Chalmers, Australian Treasurer. Thanks so much for your time.
