Australia’s historic trade deal with the United Kingdom will come into force on May 31, delivering a raft of benefits for local exporters.
Under the new Australia-United Kingdom Free Trade Agreement (A-UKFTA) there will be no tariffs on more than 99 per cent of Australian goods exports to the UK.
The main beneficiaries will be exporters of wine, short and medium-grain rice, honey, nuts, and manufactured products such as auto parts, electrical equipment, and cosmetic products.
For some agricultural products like beef, sheep meat, dairy and sugar, Australia will have access to expanding tariff quota volumes – within 10 years these tariff quotas will be eliminated completely.
Savings of about $200 million a year will be made as tariffs on imports from the UK are eliminated. After five years, all UK imports will enter Australia duty free.
And services exports worth $4.4 billion in 2021-22, are expected to grow significantly under the new agreement that cuts red tape making it easier to do business in the UK.
This includes new digital trade rules in the A-UKFTA will provide greater certainty to help Australian businesses looking to grow their digital footprint in the UK.
The FTA also provides a framework for professional bodies to agree to streamline licensing processes to facilitate the movement of qualified professionals between Australia and the UK. This move will help to improve the current skills shortage in Australia.
Strong commitments on the environment
The deal includes strong commitments on the environment, including climate change, and labour.
The trade agreement will preserve the right of the Australian Government to regulate in the public interest, including for the environment, education, and health. Importantly, there is no Investor-State Dispute Settlement mechanism.
Also, within two years of entry into force, Australians will be able to apply for working holidays in the UK to the age of 35 (up from 30) and stay for a maximum of three years instead of two.
“This agreement will deliver significant benefits to Australian exporters, consumers, workers, and our economy more broadly,” said Australian Prime Minister Anthony Albanese.
“The Australia-UK FTA represents one of the most comprehensive, innovative and ambitious free trade agreements concluded by Australia to date and strengthens an already close relationship between Australia and the UK.”
Reducing costs for exporters
Minister for Trade and Tourism Don Farrell said: “Our trade agreement with the UK will significantly reduce costs for exporters and assist Australian businesses seeking to diversify trade to a wider range of overseas markets.
“This agreement will underpin and deepen the already strong bilateral investment relationship with our second-largest source of foreign direct investment in Australia.
“This deal establishes procedures for artists, including First Nations peoples, to receive royalties when their artworks are resold in the UK.”
To learn more visit: Australia-United Kingdom Free Trade Agreement