Brexit woes suggest trade bonus, says Steven Ciobo

As Donald Trump gives off mixed signals over a trade deal with the UK, Australia could be in line to benefit, Steven Ciobo says.

Trade Minister Steven Ciobo. Picture: AAP

Donald Trump’s threats to kill off a trade deal with the UK under Theresa May’s “soft Brexit” plan could benefit Australia, Trade Minister Steven Ciobo has suggested.

But Mr Ciobo also said while Australia would press ahead with pursuing a deal with the UK, it was possible the eventual Brexit agreement could rule out an FTA.

“Australia will seek a high-quality comprehensive FTA with the UK assuming that Brexit provides for that outcome — it will either do that or it won’t,” he told The Weekend Australian ahead of a trip to discuss the deal in London. “Let’s see what the final composition of the deal is like. Anything ahead of that is speculation.”

Australia has previously said a deal would not be possible if the UK stayed in the customs union.

Mr Ciobo’s comments come after British Prime Minister Theresa May released a white paper this week outlining her government’s plans for a future relationship with the EU post-Brexit and as President Trump made a “working visit” to the UK.

The paper, seen as a UK “wish list” which will not reflect the final deal, laid out Mrs May’s request for “common rule book” of standards for food and goods and a “facilitated customs arrangement”.

A government source said the UK was trying to have it both ways in the document, in terms of having trade independence while maintaining the benefits of its trade relationship with Brussels, and there was a lot to play out politically before it was clear what the impact would be on Australia.

Mr Ciobo is attending the inaugural Australia-UK Leadership Forum in London next week and will meet UK Secretary of State for International Trade, Liam Fox.

Mr Trump caused alarm for Mrs May ahead of his visit when he told The Sun newspaper in London that British voters did not vote for her Brexit plan.

In the same interview he praised her political rival, the former foreign secretary Boris Johnson, who resigned this week.

Mr Trump also said Mrs May’s Brexit white paper meant there was no chance of a deal between Britain and the US.

“If they do a deal like that, we would be dealing with the European Union instead of dealing with the UK,” he said. “So it will probably kill the deal. If they do that, then their trade deal with the US will probably not be made.”

However, after offering an apology to Mrs May for his criticism of her during talks late last night, Mr Trump told a joint press conference he would pursue a US-UK trade deal after Brexit, despite his earlier remarks.

“Whatever you do is Ok with me, just make sure we can trade together.”

Monash University trade expert Giovanni Di Lieto, who has studied the possibilities of a UK-Australia trade deal, said Mr Trump’s initial comments were good news for Australia.

“(This) weakens the UK position even further, and plays in(to) Australia’s hands as well. Because we are not so big, we can play with a historically optimal bargaining position with the UK,” Mr Di Lieto told The Weekend Australian.

In saying all would depend on the final Brexit deal, Mr Ciobo suggested he agreed with Mr Di Lieto’s assessment.

“Clearly, if Australia has a comprehensive high quality FTA with the UK, that gives Australian exporters a market advantage over those that don’t have a comprehensive FTA with the UK post Brexit,” Mr Ciobo said.

Mr Di Lieto said a major “bump in the road” in a UK-Australia deal would be how Australian agricultural and dairy products fared under future UK-EU sharing arrangements between themselves.

Australia and New Zealand have been pushing for an increase in UK-EU quotas after Brexit. “This is going to be the major bump in the road to strike a new trade deal for Australia and the EU and also the UK,” Mr Di Lieto said.

 Mr Ciobo said he was still pushing the UK on the issue. “The issue of quota splitting is something that’s exercised my attention now for more than 12 months. I’ve had many conversations with both the EU and the UK on it,” he said.