The competitive position of Australian exporters has been enhanced by the official entry into force of the China-Australia Free Trade Agreement (ChAFTA) on December 20.
Australia’s Minister for Trade and Investment Andrew Robb said that more than 86% of Australia’s goods exports to China would enter duty free (worth more than $90 billion), while tariffs on billions-of- dollars-worth of other goods exports would be reduced. Once the agreement is fully implemented 96% of Australian goods will enter China duty free.
He said tariffs had been cut on a range of important Australian exports including dairy, beef, lamb, wine, seafood, fruit and vegetables, processed foods, vitamins and health products. Tariffs on coking coal (with exports worth $4.8 billion in 2014-15) had been eliminated, while the phased elimination of tariffs on non-coking coal also started on December 20.
“This historic agreement with our biggest trading partner will support future economic growth, job creation and higher living standards through increased goods and services trade, and investment. China, with its population of 1.4 billion people and rapidly rising middle class, presents enormous opportunities for Australian businesses well into the future,” Andrew Robb said.
“The Government’s determination to see ChAFTA’s commencement will quickly produce a double benefit for our exporters, with another round of tariff cuts to follow on January 1, 2016. This will significantly enhance our competitive position in the Chinese market.”
He said ChAFTA also opened up a range of new opportunities for Australian service providers with significantly enhanced market access for financial services companies, law firms, professional services suppliers, education services exporters, as well as health, aged care, hospitality, construction and manufacturing businesses.
The agreement would also inevitably stimulate new levels of growth in the two-way investment relationship which was currently worth around $121 billion.
“ChAFTA will also help drive innovation as Australian businesses, big and small, increasingly exploit e-commerce and other emerging technologies to connect with Chinese consumers.
“ChAFTA, along with this Government’s ground-breaking trade deals with Korea and Japan, forms a powerful trifecta of agreements with our three biggest export markets. We encourage Australian businesses to take full advantage of the opportunities they present,” he said.