Australia and the United Kingdom have finalised a trade agreement that will remove nearly all tariffs on Australian goods to the country.
Dan Tehan, Australian trade minister, and Vicki Treadell, UK high commissioner, formally signed the deal in Adelaide on Dec. 17, after an initial in-principle agreement was inked in June.
This means that over 99 percent of Australian exports tariffs, valued at AU$9.2 billion (US$6.6 billion), will be removed.
Farmers will also enjoy increased access to the UK market with the gradual phasing out of tariffs, including the removal of $43 million of customs on wine exports and an initial tariff-free quota of 35,000 tonnes of beef exports, which will gradually expand to 110,000 tonnes by the tenth year—afterwards all tariffs will be eliminated.
Further, for sheep meat, 25,000 tonnes will initially be tariff-free, expanding to 75,000 by year 10. For sugar, 80,000 tonnes will be tariff-free, which will be expanded to 220,000 tonnes by year eight—all tariffs will be eliminated afterwards.
For the UK, around $200 million in tariffs will be removed within five years on exports to Australia, including products such as cars, whisky, cosmetics, and confectionery.
In addition, British architects, scientists, researchers, lawyers, and accountants will have access to work visas to Australia without needing to be subject to requirements under the country’s skilled occupation list.
The age for working holiday visas has been raised from 30 to 35.
A new regional headquarters will be set up in Australia to assist UK businesses with investing down under.
While in turn, Australian businesses will have the right to bid for UK government contracts in a procurement market worth around half-a-trillion dollars annually.
Tehan and Prime Minister Scott Morrison said the agreement was the “most comprehensive and ambitious” free trade deal other than with New Zealand.
“The Morrison government will now work to bring the agreement into force in 2022, so Australian exporters, farmers, workers, businesses and consumers can access the benefits of this gold standard agreement as soon as possible,” they said in a statement.
The government noted that around 75 percent of Australia’s two-way trade was now covered by free trade agreements, up from the 27 percent from when it came to power.
The UK government meanwhile called the agreement a “gateway” to the Indo-Pacific region and its chances of joining the Comprehensive Progressive Trans-Pacific Partnership.
“This agreement is tailored to the UK’s strengths and delivers for businesses, families, and consumers in every part of the UK—helping us to level up. We will continue to work together in addressing shared challenges in global trade, climate change and technological changes in the years ahead,” Anne-Marie Trevelyan, the UK’s international trade secretary, said in a statement.
“Today, we demonstrate what the UK can achieve as an agile, independent sovereign trading nation. This is just the start as we get on the front foot and seize the seismic opportunities that await us on the world stage.”
Finalising the deal has been a priority for Prime Minister Boris Johnson, who has been on the move to ink other trade deals in the post-Brexit era, including an in-principle agreement with New Zealand, which will see all tariffs eliminated on NZ exports.