Interview with CNBC Squawk Box

Sri Jegarajah, Anchor [10.42am AEST]: In the meantime, CNBC's Tanvir Gill caught up with Tim Ayres, Australia's Minister of Trade and Manufacturing. He also weighed in on the potential inclusion of Britain to the CPTPP.

Tim Ayres, Assistant Minister for Trade and Manufacturing: The UK accession is the accession application that was the first application that was made to the CPTPP. There is a strong focus of the CPTPP parties, all of us, a lot of solidarity and common purpose, but making sure that the high quality [of the] CPTPP agreement is reinforced in the standards that we make sure that the UK is meeting. So, there's a lot of focus on making sure that the UK accession process is a high-quality process, because it's going to set the standards for future sessions. This is a good agreement today. It's a great benefit to the countries that are party to it today. It will be a stronger agreement if the accession to the agreement are high quality accessions, where we're making sure we share the benefits of the CPTPP more broadly.

Tanvir Gill, Host: Let's talk about China and where do things stand as far as that market is concerned for you, with China not being part of the CPTPP just as yet. What is the expectation in terms of not just bringing it in the fold of this organisation, of this association, but also improving Australia's relationship with China on the trade front?

Assistant Minister: Well, that's a question in three parts, I think, really. Firstly, just say that there is a strong determination amongst all of the CPTPP members to focus on the UK accession. It's the first application. There are five applications. The first is the UK's and making sure that that is a high-quality process that doesn't undermine what is the highest quality trade agreement in the world, in my view. So, we want to ensure that that sets the standard then for future accession applications and we will come to those accession applications following the UK accession process.

Tanvir Gill: China is a big market, right? And the sooner the better?

Assistant Minister: Well, China is a very important trading partner for Australia. It's a very significant market. Now, it is a matter of deep regret that China has interrupted some of the exports that Australia has with China. That has hurt Australian industry, it's hurt Australian exporters, and it's the wrong approach. It's dented confidence around the world in the rules-based order. That the strongest thing that we can do is continue to calmly and consistently assert what is in Australia's interest, but also in the interests of a rules-based order, particularly around trade, where we're actually following the rules and being consistent about our approach to the rules.

Martin Soong, Anchor [11.44am AEST]: Now, the ties between Australia and China have become even more complex in recent years. Under the Scott Morrison administration, Canberra joined the Trilateral Security Pact between Australia, the UK and the.US known as AUKUS. Further inflaming tensions now, economic ties have also remained on wobbly territory.

CNBC's Tanvir Gill caught up with Australia's Assistant Trade and Manufacturing Minister, Tim Ayres, and asked how things have changed under the current administration. Take a look.

Assistant Minister: Well, of course, there should be Ministerial engagement across these economic portfolios, particularly in trade. But we are going to continue to calmly and consistently advocate the Australian interest. We're going to do that in concert with our regional partners because there's a common interest, isn't there, in a shared approach to regional trade, to a rules-based approach to trading relationships. So, we'll continue on the course that we're on calmly asserting and consistently asserting the Australian interest.

Tanvir Gill: Despite the friction - correct me if I'm wrong here, Minister - apparently China still purchased 45 per cent of Australian exports last year, which was a jump from 37 per cent in 2017. And Australia continues to import a lot from China. That trade equation is still pretty strong between the two countries, despite what's happening on the political front and the geopolitical front. Do you expect some sort of mediation coming in from the WTO? Would you seek the WTO's help in trying to find common ground with China?

Assistant Minister: Well, as I said at the outset of this interview, China is a very important trading partner for Australia. It's a very important trading partner for the region. Australia's exports to China, including our iron ore exports, continue to be very strong. But it is a matter of deep regret that China has sought to ban a series of Australian exports. I think countries around the world have noticed, and it just reaffirms our commitment to the rules-based order to expanding trading relationships that are based upon rules-based, conduct and a predictable approach to trade.

Tanvir Gill: Realistically, when do you think you would be able to have the first face to face meeting with your Chinese counterparts?

Assistant Minister: Well, we've made it very clear that we're open to discussions at any time. That is a question that is probably best directed to the Chinese Minister for Trade.