15th September 2014
China and Australia are close to signing a free trade deal that could prove pivotal to the Asia Pacific region. Firm progress has been made during recent talks and the nations look set to agree the landmark partnership when G20 leaders meeting in Brisbane in November.
After ten years’ of negotiations there at last seems to be the will to finalise the agreement. China is Australia’s largest trading partner and the FTA would mark yet another step towards closer ties between the countries. Australia wants to reduce barriers for its agriculture and services sectors, while China is after better investment access and tariff reductions on consumer goods like electronics.
There has been a stronger impetus to see through the deal amid warnings of losing ground to competitors like New Zealand, which has significantly increased trade revenues for its key dairy industry since signing its FTA with the world’s second largest economy.
Some are cautioning about handing over too much. Westpac’s Rob Whitfield believes Australia could miss out on some of its key advantages as a result of the deal.
“China is our number one trading partner, but there are a lot of other countries that claim that as well, so competition for that attention is immense,” Mr Whitfield told The Australian. He called on the government not to underestimate how complementary Australia’s resources are to China.
It comes after Australia agreed a free trade arrangement with Japan in July. The Japan-Australia Economic Partnership Agreement (JAEPA) will see more than 97 per cent of Australia’s exports to Japan enjoying preferential access or enter duty-free.
“This is the most ambitious trade deal Japan has ever concluded with anyone and affords Australia major concessions across a range of areas, most notably services and agriculture, an area of traditional sensitivity for the Japanese,” said minister for trade and investment Andrew Robb. The Japan deal was a major boost for Australia’s beef industry, which is the country’s biggest agricultural export to Japan.