Australia has chosen to ratify the Trans-Pacific Partnership trade agreement, a move the Prime Minister says will give greater opportunities to Australian businesses.
Joining five other countries around the world, Australia has opted to ratify the Trans-Pacific Partnership (TPP-11) trade agreement, a move the Prime Minister says will give greater opportunities to Australian businesses.
Announced Wednesday (October 31), Australia joined Canada, Japan, Mexico, New Zealand and Singapore in ratifying the agreement. The move is set to guarantee “maximum benefits” for Australian farmers and businesses, and also comes with a bonus of two tariff reductions between December 30 and January 1, 2019.
“The TPP-11 is one of the most comprehensive and ambitious trade agreements in Australia’s recent history. It will help support Australian businesses to grow and see annual benefits of up to $15.6 billion to our national economy by 2030,” read a joint statement from Prime Minister Scott Morrison and Minister for trade, tourism and investment Simon Birmingham.
“Australian farmers and businesses will particularly benefit from new high-quality free trade agreements with Canada and Mexico, our first ever with these two of the world’s top 20 economies.”
The statement highlighted the agreement’s particular benefits to Australia’s agricultural sector, as it would give new access to Canada’s market for Australian grain, sugar and beef exporters.
Similarly, the country would also gain entry to Mexico’s market for pork, wheat, sugar, barley and horticulture exports, and would improve access into Japan for beef, wheat, barley and dairy exporters. This would extend market access past the currently active bilateral Japan-Australia Economic Partnership Agreement.
On the industrial side of the market, exporters of products like iron and steel, leather, paper products and medical equipment would have a new ability to strengthen their business through no longer having a tariff disadvantage. The exporters of these items currently sell $19 billion worth of products to TPP-11 markets.
Also commenting on the move was the Minerals Council of Australia (MCA), which had commissioned economic modelling to show the impact TPP-11 would have by 2030. According to the modelling, the agreement would increase Australia’s national income by $15.6 billion, boost exports by $29.9 billion and generate extra direct investment into Australia of $7.8 billion, along with additional overseas investment by Australian businesses of $26 billion.
“By trading with the rest of the world, Australia generates export earnings to support growth and jobs at home, gives consumers lower prices and more choice, forges more competitive industries and a more efficient economy,” MCA CEO Tanla Constable said in a statement.
Don’t forget to follow us @INN_Resource for real-time news updates!
Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.