Australia and China have signed a breakthrough free trade deal even as a multilateral Pacific trade agreement seems to be a thing of distant future.
Australia trade minister Andrew Robb warned that negotiations to attain a Pacific trade agreement is in logger jam as the US Congress again failed to pass legislation to allow the 12 countries included in the negotiations to effectively come to a conclusion.
China is one of Australia’s biggest export markets with the two-way flow of goods and services exceeding $160 billion last year. The new deal is also the most liberal trade deal China has with any country. Prime Minister of Australia Tony Abbott also lauded the deal noting that it is another giant step in the relationship between the two nations. "It will change our countries for the better, it will change our region for the better, it will change our world for the better," he said.
The trade deal brings to the table a cut in tariffs for more than 85 per cent of Australian exports to China, rising to 95 per cent when in full force, which implies that Australian agricultural items and processed foods will be given a better access to China in next few years. Australia will also abolish the existing five per cent tariff on Chinese electronics and whitegoods, even if it means a reduction in government revenue. The deal would be routinely reviewed, according to Robb who praised the strong and visionary leadership of Mr Abbott and President Xi for finalising 10 years of negotiations. Certain clauses in the agreement also opens the way for increased Australian investment in China and increased Chinese investment in Australia.
Even as the deal was ratified, certain industries, including real estate, were skeptical of increased Chinese presence in Australian market.
Australia trade minister Andrew Robb warned that negotiations to attain a Pacific trade agreement is in logger jam as the US Congress again failed to pass legislation to allow the 12 countries included in the negotiations to effectively come to a conclusion.
China is one of Australia’s biggest export markets with the two-way flow of goods and services exceeding $160 billion last year. The new deal is also the most liberal trade deal China has with any country. Prime Minister of Australia Tony Abbott also lauded the deal noting that it is another giant step in the relationship between the two nations. "It will change our countries for the better, it will change our region for the better, it will change our world for the better," he said.
The trade deal brings to the table a cut in tariffs for more than 85 per cent of Australian exports to China, rising to 95 per cent when in full force, which implies that Australian agricultural items and processed foods will be given a better access to China in next few years. Australia will also abolish the existing five per cent tariff on Chinese electronics and whitegoods, even if it means a reduction in government revenue. The deal would be routinely reviewed, according to Robb who praised the strong and visionary leadership of Mr Abbott and President Xi for finalising 10 years of negotiations. Certain clauses in the agreement also opens the way for increased Australian investment in China and increased Chinese investment in Australia.
Even as the deal was ratified, certain industries, including real estate, were skeptical of increased Chinese presence in Australian market.