While the nation’s best and brightest get together for the confabulation known as the 2020 Summit, perhaps they should be pondering the realities of globalization, and free trade. The latest victims of this process are the 310 employees of Fisher & Paykel who will lose their jobs when the company closes its Brisbane factory and shifts the manufacturing operation to Thailand.
Apparently the workers in Thailand will be paid about $2 an hour, as compared with the Australian workers at $18 to $21 per hour. As if that is not enough economic incentive, it also seems that Thailand is prepared to offer incentives and subsidies to manufacturers that Australia is not, despite the fact that our two countries have a free trade agreement.
Free trade and globalization are a fact of life, and they are not going to go away. But the important thing is to find ways to benefit from globalization, and to manage the process to our own advantage. So long as our trading partners continue to subsidise their industries in this way, so called free trade is undermining our industry and our way of life.
It is also important that Australia maintains, and improves, both its capacity and expertise. To that end, properly directed subsidies for manufacturing should not be seen as protectionism or as propping up inefficient industries, but as an investment in both prosperity and security.
If we ever reach the point where we can no longer manufacture anything for ourselves we will have arrived at the Banana Republic that Paul Keating once warned us about.