Australia has now signed on to 6 Free Trade Agreements, and the original one with New Zealand remains the most comprehensive.
The newer agreements cover the United States of America, Thailand, Singapore, New Zealand & ASEAN, and of course Chile. There a number of other agreements under negotiation, including with China, Japan, India, Korea, Malaysia, Indonesia, the Gulf Co-operation Council and the Trans Pacific Partnership. The Government’s pursuit of high-quality, truly liberalising free trade agreements that support the multilateral trading system complements its commitment to multilateral trade reform and liberalisation, including concluding the Doha Round of trade negotiations. .
What does this all mean for Australia’s small to medium exporters? It means the government has a goal of trying to remove the distortions in international trade flow that detract from quality and price being the determinants of success in another market. Some of these distortions are created by high tariff barriers at the border, but increasingly they are the ‘behind the border’ issues like quotas, content rules or trade facilitation charges and requirements that effectively bar, or price-out products and services from certain countries.
In addition to tariff reductions, as a large services exporter we need to see our businesses given the same opportunity to compete and win business as both local providers and other international players. Ensuring that IP protection is honoured in these partner countries is another important consideration.
The government has teams led by the Department of Foreign Affairs and Trade (DFAT) working on the content of future FTAs to ensure Australian business is not disadvantaged by exclusions from the partner country, and to highlight any existing issues that restrict access by our exporters.
How do they know? Well to a large extent they rely on information given by Australian businesses currently exporting to or working in, or wishing to work in, the partner country. To this end consultation sessions are run in each state to seek the experiences and views of Australian business and those that support them. There is also the ability to forward submissions, by email, letter or fax, to the negotiating teams or via your DFAT State Manager. Addresses for the FTA teams can be found on the DFAT website pages on each FTA negotiation. These views are listened to and incorporated into discussions, and the size of your company is not the determinant.
So the important action for exporters, and particularly for the small to medium exporter without a full time advisor, is to have a look at the agreements under negotiation, and provide your legitimate feedback and views. This is the stage where your concerns will be taken into consideration, and perhaps influence a key part of the outcome for your company and others.
The existing agreements that we have in place are also reviewed at regular intervals to see how effectively they are working, so practical experiences should also be forwarded through to DFAT.
FTAs include a lot of detail, and there may be many exporters who are not aware of the potential benefits of the agreements we have in place for their business. For instance under the tariff reduction schedules for their particular product, there may be relative advantages in exporting under say the Australia-Thailand FTA vs the AANZ FTA (which also includes Thailand). The full details on the agreements and the tariff levels (and the origin certificates where required) can be found on the DFAT website at www.dfat.gov.au.
We would encourage exporters then to take advantage of the FTA’s in three ways:
1. Provide information on any issues effecting, or likely to affect your business under an FTA under negotiation.
2. Review existing agreements to ensure you are aware of benefits to your company.
3. Provide feedback on experiences (both good and bad) under existing agreements so that they work as effectively as possible.
With FTAs, the government is listening, so have your say...