SYDNEY: China’s economy is fundamentally strong despite slowing growth, Australia’s new Treasurer Scott Morrison said Wednesday, urging his country’s opposition to support a new free trade pact with Beijing.
Disappointing manufacturing figures from China Wednesday renewed fears about the world’s second largest economy and global growth, and sent commodity-linked currencies falling along with Asian stocks.
Growth in resource-rich Australia is closely tied to its largest trading partner China, which is also the world’s largest commodities consumer. In June they sealed a landmark free-trade agreement (FTA) after a decade of talks.
“The position with China is one of fundamental strength at the end of the day,” Morrison told reporters in Sydney.
Morrison, who met central bank governor Glenn Stevens earlier Wednesday three days after he replaced Joe Hockey in a major cabinet reshuffle, said the Chinese economy was strong and Australia well placed to benefit from the pact.
“They’re growing at around about seven percent and that seven percent growth today is worth about 10 percent a decade ago, as the governor reminded me this morning,”
Morrison said in his first press conference in his new role.
“They’re growing off a much higher base now.
“Their economy is in a far stronger position and more diversified position than it was and it has become an economic powerhouse through which we have the only free-trade agreement, as I understand, in the entire G20 of nations. That pitches us well to succeed.”
The Labor opposition party is challenging parts of the pact on fears it could lead to a loss of Australian jobs.
“What (Labor leader) Bill Shorten is doing in opposing the free-trade agreement with China is he is saying he wants Australia to hide in the corner, to hide in the corner away from the growth opportunities that are going to be there for our kids, for your kids and generations to come,” Morrison said.
New Prime Minister Malcolm Turnbull, who ousted Tony Abbott in a Liberal Party coup last week, has made economic growth his administration’s key focus.
Turnbull said the FTA would open up China to all local businesses and appealed to Labor to support the deal in parliament.
“It is an absolutely fundamental building block for our prosperity,” Turnbull told Sky News.
Australian growth has slowed over the past year as it undergoes a shaky transition away from an unprecedented resources investment boom, with non-mining business failing to fill the spending gap.