Australia-UK FTA one step closer to kick-off
UK Parliament has approved the historic agreement, signed back in 2021A free-trade agreement (FTA) inked between Australia and the United Kingdom that will see plenty of tariffs reduced and removed is expected to come into effect soon after the UK Parliament officially ratified the agreement last week.
The deal was signed in December 2021 between former Federal Trade Minister, Dan Tehan, and then UK Secretary of State for International Trade, Anne-Marie Trevelyan, in a virtual ceremony.
The FTA will remove tariffs on over 99 per cent of the $9.2 billion Australian goods exported to the UK annually.
The deal is expected to greatly benefit Australia’s agriculture industry, by removing tariffs on a number of key exports including beef, sheep, sugar, dairy and wine over time.
Some of the key outcomes for agriculture are:
- Beef tariffs will be eliminated after 10 years. During the transition period, Australia will have immediate access to a duty-free quota of 35,000 tonnes, rising in equal instalments to 110,000 tonnes in year 10.
- Sheep meat tariffs will be eliminated after 10 years. During the transition period, Australia will have immediate access to a duty-free quota of 25,000 tonnes, rising in equal instalments to 75,000 tonnes in year 10.
- Sugar tariffs will be eliminated over eight years. During the transition period, Australia will have immediate access to a duty-free quota of 80,000 tonnes, rising by 20,000 tonnes each year.
- Dairy tariffs will be eliminated over five years. During the transition period, Australia will have immediate access to a duty-free quota for cheese of 24,000 tonnes, rising in equal instalments to 48,000 tonnes in year five.
- Australian dairy farmers will also have immediate access to a duty-free quota for non-cheese dairy of 20,000 tonnes.
- Rice will receive immediate duty-free access for short- and medium-grain milled rice.
Other benefits from the agreement include expanded eligibility for a working holiday visa in the UK with the age limit raised from 30 to 35 years. Australians will also be able to stay longer, with stays allowed for up to three years in each country.
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Under the FTA, Australian professionals will also have the same access to the UK’s lucrative jobs market as European nationals, opening the door to more intra-company transfers.
“This trade agreement will remove unnecessary barriers to trade between our two countries and open up new markets for our world-class goods and services,” said Federal Trade Minister, Don Farrell.
“Our economy is stronger when global trade flows freely and the Australian government is delivering on our commitment to strengthen and diversify our trading relationships.”
The National Farmers’ Federation sounded its support for the FTA and welcomed the recent advancements in making it a reality.
“We applaud the Australian and UK governments for reaching a deal that meaningfully reduces trade barriers, at a time when many countries are choosing to step back from trade liberalisation,” the organisation said.
“Australia has among the lowest agricultural subsidies in the OECD. To survive and thrive, Australian farmers rely on open and fair access to export markets.
“The UK FTA sets a strong standard from which to continue negotiations with other markets, as Australia continues to provide an important voice for levelling the playing field for agricultural trade.”
The Australia-UK FTA will enter into force after UK processes are complete and Australia and the UK exchange diplomatic notes identifying a commencement date.
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