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90% of Australian imports will enter duty free to the UK with new trade deal

Australia and the United Kingdom have agreed on the broad outlines of a Free Trade Agreement between the countries, a move welcomed as ‘a win’ for Australian producers.

Although the details of the deal are still to be finalised, in principle the deal is described as bringing more business opportunities for Australian exporters and also providing easier access for travellers once borders open again.

Ninety-nine per cent of Australian imports, including Australian wine and spirits, will enter the UK duty free when the agreement comes into force. The Government said Australian producers and farmers will receive a significant boost by getting greater access to the UK market.

Australian consumers will benefit from cheaper products, with all tariffs eliminated within five years, and tariffs on whisky and the UK’s other main exports eliminated immediately.

The deal also sees changes to working holiday visas with the cut-off age increased to 35 and provide up to three years of working rights and specific provisions around agriculture-specific visas.

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Prime Minister Scott Morrison said: “One of the biggest challenges we have, particularly in COVID when there’s such restriction on movements of people, we need to meet workforce challenges to ensure our primary producers, in particular, can make the most of the linear agreement we’ve agreed here today.”

The announcement has been welcomed by industry associations, with Australian Grape & Wine saying it was a key milestone in introducing more UK consumers to more Australian wine.

“The United Kingdom is an incredibly important market for Australia’s grape and wine businesses, and British consumers are some of the most enthusiastic Australian wine aficionados,” said Tony Battaglene, Chief Executive of Australian Grape & Wine.

“What we’ve seen today is a commitment by the Australian and UK Governments to finalise a trade agreement that will drive benefits to the economies of both countries and make exporting our world class wines to the UK easier for Australian wine businesses.

“We’re hoping the final text of the agreement will address a range of costs and barriers Australian wine exporters currently face in the UK. We know there is more work to do on the detail, but the elimination of tariffs is critical for our sector.

“Other areas we are hoping to see progress on, include simpler certification requirements, and improvements in our ability to further process and package Australian wines in the UK market, which will drive innovation, create jobs here and in the UK, and reduce our carbon footprint.”

Spirits & Cocktails Australia also welcomed the deal saying it was a win for producers and consumers.

Spirits and Cocktails Australia chair Angus McPherson, said: “We congratulate the U.K. and Australian governments on a deal that will give consumers more choice of Scotch Whisky and English gins and support the wider hospitality sector.

“The proposed deal is positive news for the producers of an array of fine Australian goods who are ready to expand into new markets, and will no doubt generate welcome job opportunities here and in the UK.

“As both governments work on the final text of the agreement, Spirits and Cocktails Australia also hopes to see more support for the promotion and distribution of award-winning Australian spirits within the UK.

“It is important to note that Australia pays the third largest spirits tax in the world. While outside of the remit of any FTA, this is a burden that will continue to stymie foreign direct investment and efforts to grow an industry that has the potential to match Australian wine in terms of export growth and worldwide prestige.

“Spirits and Cocktails Australia looks forward to continuing to work with the Australian government to reduce this burden.”

The two countries will now finalise the text, and carry out the domestic processes required to enable signature and the subsequent entry into force of the FTA.

By: Andrew Young, The Shout

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