Australian PM Rudd urges China action on trade deal

Australia's former prime minister Kevin Rudd speaks to the media at Parliament House in Canberra June 26, 2013.

CANBERRA (Reuters) - Australia's Sinophile Prime Minister Kevin Rudd on Friday urged China - the country's largest trading partner - to conclude a stalled free trade deal, using his first news conference since regaining power to praise the current bilateral relationship.

Rudd, a former diplomat who speaks fluent Mandarin, said China's concerns that its farm industry could be hurt by a free trade pact with Canberra were unfounded given the size of Australia's agricultural output.

Australia and China began free trade talks in 2005, but the negotiations have stalled over Beijing's concerns over opening their markets to Australian food, while Australia wants China to do more to protect intellectual property. The 19th round of talks was held earlier this month.

"This thing has been moving across the Sahara at the pace of a slightly lame camel," Rudd said, two days after reclaiming the prime ministership from Julia Gillard.

"I'd say to our friends in Beijing, let us conclude a free trade agreement between China and Australia."

Rudd said China had no need to worry about the impact of agricultural imports on its vast rural territory, as Australia's total farm production would only meet the extra expected demand from a single Chinese province.

Australia is the world's second largest wheat exporter and third largest exporter of beef and raw sugar, with agricultural exports worth around A$36 billion ($33.40 billion) a year. Bilateral yearly trade between Australia and China is worth around A$120 billion.

Australia wants to boost farm output to become a foodbowl for Asia to meet an expected rise in global food demand. China is encouraging its firms to expand overseas to increase food security for its 1.3 billion people, with some Chinese companies eyeing Australian farms.

INDONESIA VISIT

Rudd, who made foreign policy a focus of his 2007-2010 leadership, refused to confirm whether he would go ahead with a planned visit to neighboring Indonesia next week, but said he would raise the flashpoint issue of people smuggling and asylum seekers if he went ahead with the trip.

Asylum seekers arriving by boat after passing through Indonesian transit points are a hot political issue in Australia, where voter anger at the constant arrivals is perhaps the most damaging factor threatening to unseat the Labor government at looming elections.

Rudd, however, hit out at plans by the conservative opposition to use Australia's navy to turn back crowded refugee boats and send them back to Indonesia, saying the plan - rejected by Jakarta - risked provoking a conflict.

"There is a risk of diplomatic conflict. You need to be mindful of where that conflict can lead to," he said.

Australia and Indonesia have a history of uneasy ties, although relations have improved dramatically since a 1999 low over Canberra's leadership of a military intervention in support of East Timor's vote for independence from Jakarta.

The opposition's foreign affairs spokeswoman, Julia Bishop, condemned Rudd's comments and demanded he apologize.

"It is outrageous beyond belief that the prime minister would try and misrepresent a policy and drag Indonesia into his base political debate by suggesting a possible conflict," she said. "The man is meant to be a former diplomat."

($1 = 1.0779 Australian dollars)

(Editing by Rob Taylor and Ron Popeski)