Trade deal termed milestone in Australia and China bilateral relations
Australia and China have signed a landmark free trade agreement after more than a decade of negotiations, providing a boon for jobs and growth in the country in coming years.
Australian Prime Minister Tony Abbott and Chinese Trade Minister Gao Hucheng attended the signing ceremony Wednesday in Canberra.
“The China-Australia Free Trade Agreement (ChAFTA) will lock in existing trade and provide the catalyst for future growth across a range of areas including goods, services and investment,” Abbott said.
“The Agreement secures better market access for Australia to the world’s second largest economy, improves our competitive position in a rapidly growing market, promotes increased two-way investment and reduces import costs. It is a win for households and businesses alike,” he added.
“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. “This agreement will give our nations unprecedented access to each other’s markets.”
Trade Minister Gao praised the free trade deal, which was struck late last year, as “comprehensive, high-quality and balanced.”
Noting that the leaders of the two countries have attached great importance to the signing of FTA, Gao said, “It is a milestone in bilateral relations.”
“It has the highest degree of liberalization amongst all the FTA’s China has so far signed with another economy,” he said.
China is Australia’s biggest trading partner, with the two-way flow exceeding 160 billion dollars annually.
Under the deal more than 85 per cent of Australian goods entering the country will carry no penalty, rising to 95 per cent on full implementation.
The wide-ranging agreement will also lower restrictions on Chinese investment in Australia and make it easier for Australian banks, insurance companies and universities to do business in China.
Abbott said Australia’s agriculture sector would also be able to capitalise on its well-deserved reputation as a clean, green producer of premium food and beverage products.
Tariffs will be progressively abolished for Australia’s USD 13 billion dairy industry.
“Australia’s beef and sheep farmers will also gain from the phased abolition of tariffs ranging from 12-25 per cent and all tariffs on Australian horticulture will be eliminated,” the prime minister said.
Under the deal, the tariffs on cooking coal were also removed from day one, with the tariff on thermal coal being phased out over two years apart from tariff elimination on a wide range of Australian manufactured goods, including pharmaceutical products and car engines.
“ChAFTA completes a historic trifecta of trade agreements with our top three export markets, accounting for more than 55 per cent of our total goods and services exports. Together, these agreements will enhance our vital trade and investment relationships in the region, assist the process of reform, and foster greater prosperity,” he said.
The agreement will enter into force after the completion of domestic legal and parliamentary processes in China and Australia, including review by the Australian Parliament’s Joint Standing Committee on Treaties, and the Senate Foreign Affairs, Defence and Trade References Committee.