'Australia kicks off talks for trade deal with post-Brexit Britain' Hans Van Leeuwen, The AFR
London | The Morrison government has launched formal talks for what it hopes will be a rapid-fire free-trade agreement (FTA) with post-Brexit Britain, but has downplayed hopes of any big changes to either countries' visa regime.
The talks on expanding the two countries' $30 billion annual trade were meant to start three months ago, but the all-consuming coronavirus pandemic put a handbrake on the process. Still, Trade Minister Simon Birmingham said he hoped to get a deal over the line quickly.
"I still hope that we can make up that lost time and see what can be achieved this year," he told The Australian Financial Review. "I hope with the combination of goodwill and good strategy that we can move through this quickly."
The deal is one of five FTAs Britain is prioritising for the early days of Brexit, alongside the European Union, the United States, Japan and New Zealand. The Antipodean talks were both launched on Wednesday and complete the quintet.
For Britain, the Australian and New Zealand deals are supposedly going to be the easy runs on the board; but nobody is underestimating the challenge of getting better access for Australian farm exports.
Canberra wants to see a much less restrictive regime for Australian exports of beef, sheepmeat and sugar, but British farmers are in stridently defensive mode and will try to collar Prime Minister Boris Johnson's trade-liberalising instincts.
"Agriculture is historically close to the most sensitive topic in any trade negotiation whether they’re multilateral or bilateral, and I’ve got no doubt there will again be some sensitivities here," Senator Birmingham said.
He said British farmers should not fear a sudden rush of cheap agricultural imports from Australia, because Australian farmers already had extensive commitments to markets in their own region.
"It will be more a case of targeted, higher-value goods that provide UK consumers with more choice, higher quality and perhaps might displace the odd good from Europe or elsewhere rather than from the UK’s domestic industries," he said.
Expectations have been raised that both Britain and Australia might look to use the FTA to lever open access to each other's labour markets through a more generous visa regime.
Senator Birmingham said Britons and Australians had always viewed a spell spent working and living in each other's countries as "a rite of passage", but he was careful not to fuel expectations of any major breakthrough.
"While there are often elements in a trade deal where we make sure that highly skilled workers who might be germane to the flow of investment, or skilled professionals and even working holiday makers can travel between countries, we shouldn’t expect that this is a wholesale rewriting of either the UK’s or Australia’s visa laws," he said.
"It certainly provides opportunities for us to streamline some of those areas or work rights and travel rights where it’s in each other's interests to do so, but we should keep the idea that it’s going to be complete open borders in check, because that’s not what a trade agreement is about."
In the absence of greater labour-market access or significant boosts to farm exports, there is the question of what the FTA might substantively achieve. Britain and Australia already have relatively open access to each other's markets, after all.
The British government predicts a £1 billion boost ($1.8 billion) to the UK's exports to Australia and New Zealand, and is hoping to sell more whisky, cars and professional services.
Senator Birmingham said the lack of an FTA meant the ease of trade between Britain and Australia was currently "more a function of good fortune than good management". He said more could be done to harmonise regulations and enhance mutual recognition of professional qualifications, boosting the services industries.
He also hoped to see an end to wine tariffs, allowing Australia to further entrench its existing dominance of the British wine market, and wants a better deal for sheepmeat.
He said he was prepared to keep the talks running longer to get a good deal. But on the positive side, Britain and Australia would start from an agreed baseline: the 11-country Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which Britain also wants to join.
"We are looking at using existing TPP text wherever we can to streamline those negotiations" Senator Birmingham said.
"We [will] at least use the TPP text as a baseline; and then where we think Australia and the UK could go further, let’s take it further in terms of the ambition in the discussion, be that in traditional areas of a trade agreement or emerging areas like digital trade."
by Hans Van Leeuwen, The Australian Financial Review.
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