Shipping containers sit stacked at the Port of Brisbane in Brisbane, Australia on April 29, 2020. (PHOTO / BLOOMBERG)
The UK and Australia have agreed to most of a free-trade agreement, with a deal between the countries now expected in June.
“We have made major breakthroughs over the past few days and an agreement is now in sight,” International Trade Secretary Liz Truss said in a statement Friday. “We will spend the next few weeks ironing out details and resolving outstanding issues, with a view to reaching a deal by June.”
Australia is the UK’s 20th-largest trading partner globally and total trade between the two countries was worth 18.8 billion pounds (US$26 billion) in 2019
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The UK has been seeking new trade pacts since its exit from the European Union, and an accord with Australia has been one of its top priorities. Though the economic impact from a deal is expected to be modest — a 0.02 percent boost to UK GDP over 15 years — it’s a political boost for Prime Minister Boris Johnson, who wants to demonstrate any post-Brexit upsides.
Britain is also in talks with the US and New Zealand, plus it wishes to join an 11-country pact which includes Singapore, Malaysia and Japan. The UK is hoping renegotiated trading relationships will offset the negative consequences of quitting the EU’s single market and customs union, which is expected to leave Britain’s economy 4 percent smaller than it would’ve been compared to staying in the EU, according to the Office for Budget Responsibility.
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Australia is the UK’s 20th-largest trading partner globally and total trade between the two countries was worth 18.8 billion pounds (US$26 billion) in 2019. Through a trade accord, Britain is hoping to benefit from reduced tariffs on products like Scotch whisky, clothing and cars. Australia, meanwhile, is hoping to boost exports of services and agricultural products to the UK.
“It is a fundamentally liberalizing agreement that will support jobs across the country and help us emerge stronger from the pandemic,” Truss said.
