FEDERAL Trade and Investment Minister Andrew Robb says Australian agriculture will be “the biggest winner by a country mile” via the Trans Pacific Partnership’s ratification.
Mr Robb signed the TPP in New Zealand last week, paving the way for the historic trade deal to now face political scrutiny in each of the 12 participating countries.
The broad ranging multi-lateral trade deal will eliminate 98 per cent of tariffs between the 12 countries involved and has been roundly welcomed by national farming groups.
For horticulture specifically, all tariffs on horticulture products entering Canada, and most tariffs going into Peru and Mexico will be eliminated on entry into force or shortly after.
For wine, existing high tariffs in Canada, Malaysia, Vietnam, Mexico and Peru to be eliminated either on entry into force or shortly after.
Exports of wine to these countries are significant already, with Canada taking $174m worth in 2014.
In total Australia exports almost half of the $1.9b worth of wine exports to TPP countries.
Speaking to media, Mr Robb said the USDA had conducted extensive work on the TPP’s projections concluding that Australian agriculture would be “the biggest winner by a country mile” with a 19pc trade increase by 2025.
He said that represented tens of billions of dollars of increased opportunity for Australian farmers, “so people should be looking at all these different models”.
Mr Robb said many aspects of the TPP were difficult to model but one “significant value” of it was having a single set of trading rules across 40 per cent of the world’s GDP.
Negotiations on the TPP started in 2008 but were delayed last year casting the outcome into doubt, due to domestic political machinations around the US and Canadian elections
However, the 12-countries reached agreement after re-scheduled talks were held in Atlanta, Georgia last October marking a major coup for Mr Robb and the Coalition government after striking other Free Trade Agreements with Korea, Japan and China lowering tariff barriers on key farm exports like beef and grains.
Australia’s exports of goods and services to TPP countries totalled $109 billion last year – a third of Australia’s total exports.
In 2014, Australian investment in TPP countries was 45 per cent of all outward investment.
Mr Robb said under the TPP, tariff barriers would be eliminated on US$9 billion of Australia’s dutiable exports to the 12 countries, including $4.3b worth of agricultural goods with new levels of access for beef, dairy, sugar, rice, grains and wine.
He said a further $2.1b of Australia’s dutiable exports will receive significant preferential access through new quotas and tariff reductions.
“The signing of it is just one stage – now every country will go back to their parliamentary systems and take the document and the agreement through public hearings and the parliamentary processes before ultimately this agreement comes into force,” he said.
Agriculture and Water Resources Minister Barnaby Joyce said the gains solidified by the TPP would help to drive stronger profits to Australian agricultural and food producers.
“Today we’re a step closer to the benefits that will flow from the world’s largest ever regional trade agreement - an agreement including five of our top 10 trading partners,” he said.
“The agreements with Korea, Japan and China are delivering real returns and we’re now working toward bilateral agreements with India and Indonesia - two important trading partners where demand for agricultural and food products is set to boom in the coming decades.
“At the same time, we are working hard to pursue improved technical market access. Tariff reductions and eliminations are essential but we also need to achieve technical market access to translate FTA outcomes into real opportunities.”
Today we’re a step closer to the benefits that will flow from the world’s largest ever regional trade agreement - an agreement including five of our top 10 trading partners.
- Andrew Robb
Shadow Trade Minister Penny Wong said Labor would scrutinise the TPP to ensure it delivered economic benefits without undermining Australian public policies in areas like affordable medicines, environmental protection and balanced intellectual property laws.
But she said Labor did not support the inclusion of Investor-State Dispute Settlement provisions in the TPP and have insisted it not affect the cost or availability of medicines for Australians.
“We will now examine the agreement to ensure it lives up to the claims by Malcolm Turnbull and Andrew Robb that there will be no adverse impact on the Pharmaceutical Benefits Scheme,” she said.
Australian Greens trade spokesperson and Tasmanian Senator Peter Whish-Wilson called on Mr Robb to put the TPP up for independent scrutiny by the Productivity Commission.
“If the TPP is so good for Australia Andrew Robb would listen to the community and to the Productivity Commission and get the TPP independently assessed,” he said.
Mr Robb said Australia’s scrutiny process would include a Joint Standing Committee on Treaties inquiry and parliament’s consideration of any implementing legislation or amendments.
The 12 TPP member countries are; Australia, NZ, the US, Singapore, Canada, Mexico, Japan, Chile, Peru, Vietnam, Malaysia and Brunei Darussalam.