LONDON (AP) – Britain and Australia on Tuesday announced the outlines of a free trade deal, removing tariffs on a wide range of goods as the UK seeks to expand ties in the world after leaving the European Union.
The pact is expected to boost exports of traditional British products such as Scotch whiskey, while boosting imports of lamb and wine from Australia. Especially for Britain, it will also reduce barriers to trade in financial and other services. The UK hopes the deal will help it join the Trans-Pacific Trade Partnership, which would open the door to increased trade across the Asia-Pacific region.
It is the first trade deal Britain has negotiated from scratch since leaving the EU. Previous agreements with countries like Japan and Canada were based on existing agreements concluded by the EU.
British Prime Minister Boris Johnson appeared outside his Downing Street office with his Australian counterpart Scott Morrison on Tuesday, to highlight the benefits each country would gain from the deal and to underline the long ties between the two nations.
“This is an ambitious free trade agreement,” Morrison told reporters. âThis is not a standard cookie-cutter agreement. This is an agreement with great ambition for both countries. ”
While the two leaders touted the benefits of the deal, details were limited. The UK said a final tentative deal would be released “in the next few days.”
Australia is the UK’s 14th largest trading partner, accounting for Â£ 13.9 billion ($ 19.5 billion) in exports and imports last year, according to UK government statistics. The relationship is even more important for Australia, which counts Britain as its 5th largest trading partner.
Australian farmers could be a big beneficiary of the deal, as agricultural products account for around 14% of the country’s total exports. This has raised concern among UK farmers, who fear they will not be able to compete with cheap imports from Australia, which has different animal welfare and protection rules than the UK’s. environment.
British farm groups reacted with caution, saying they were waiting to see details of the deal.
“The ultimate test of this trade deal will be whether it helps move agriculture across the world on a more sustainable basis, or if it instead damages UK agriculture and simply exports the impact on the environment and animal welfare of the foods we eat, âNational Farmers said. Union President Minette Batters said in a statement.
Johnson defended the deal, saying duty-free agricultural imports would be capped for 15 years to protect British farmers. The government has also said it will seek to increase agricultural exports to Asia and the Pacific.
“I want everyone to understand that this is a sensitive area for both parties and that we have an agreement that spans 15 years and contains the strictest possible provisions for the welfare of the people. animals, âJohnson said. “But I think it’s a good deal, and I think it’s a deal that will also benefit UK farmers and UK consumers.”
While the agricultural products debate has gained attention during the free trade agreement negotiations, provisions governing professional services could have a greater impact on the UK economy.
Australia imported Â£ 5.4bn of services from the UK last year, making it the 10th largest market for the UK service industry. Services represent around 80% of the UK economy.
“It is encouraging to see the services recognized in (the Free Trade Agreement) and in the future we are convinced that there will be a continued dynamic to strengthen ties in financial and professional services in particular”, said Catherine McGuinness, policy chair for the City of London Corp. ., which represents the UK financial services industry.
McGuirk reported from Canberra, Australia.
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