Iraq eclipses US-Australia trade talks

By NICK SQUIRES in Sydney

Australian and United States officials began negotiating the framework for a wide-ranging free-trade agreement yesterday, at the start of a week of talks which will set out a road map for a deal potentially worth A$4 billion ($4.3 billion) a year to Australia.

But the talks were overshadowed by the crisis with Iraq.

Prime Minister John Howard dismissed suggestions that the Americans' willingness to come to the negotiating table was underpinned by Australia's staunch support for the Bush Administration over Iraq.

Canberra has sent 2000 personnel to the Gulf and has shown itself to be one of the most loyal members of the so-called coalition of the willing poised to attack Iraq.

"We are not taking the stance we are on Iraq in order to win a trade deal," said Howard. "I would never do that. I see the two things as quite separate.

"The American economy in the long term will be tremendously important to Australia ... and that's the reason I am going for a free-trade agreement.

"But I am not trading support over Iraq for a free-trade agreement. I am not seeking to leverage one off the other."

His comments were echoed by the Trade Minister, Mark Vaile, who said the Government had been pursuing the agreement since well before the September 11 terrorist attacks on Washington and New York and the ensuing US-led war on terrorism.

Australia wanted a trade agreement, Vaile said, because the US economy was the largest in the world and was set to grow at a faster pace than Europe in the next 50 years.

He said a free-trade agreement could be worth up to A$4 billion a year to Australia within a decade.

Australia wants to open up the heavily subsidised and protected US market to its farm exports, while the US wants improved access to Australia for its manufacturing, services and entertainment industries.

Herald Feature: Iraq