‘After almost a decade of negotiations, it’s important to finally turn the TPP into reality’ said Heath Baker, Head of Policy for the Export Council of Australia. The Export Council of Australia welcomes the conclusion of negotiations for the Trans-Pacific Partnership (TPP). Even without the United States, the TPP will provide significant new and improved market access for Australian exporters.
In addition to providing new access to major markets such as Canada and Mexico, the TPP also has a number of provisions that make tangible improvements to doing business between TPP members, such as making it easier for goods and data to flow.
‘Bilateral agreements are good, but when it comes to trade agreements, bigger is better’ explained Mr Baker. ‘More countries involved means that it’s easier for Australian exporters to be eligible for lower tariffs, even when exporting to countries with which we already have an FTA.’
Multi-country trade agreements, like the TPP, come into their own when it comes to value chains. Take an example where inputs are sourced from Vietnam, go through value-added processing in Australia, then the final products are sold in Japan. In this case, it might be hard for the Australian exporter to comply with the conditions for accessing lower tariffs under Australia’s FTA with Japan, but they would be eligible for preferential tariffs under the TPP.
‘Australian exporters have gone through two years of uncertainty about if and when this deal is going to happen’ said Mr Baker. ‘We call on the government and opposition to demonstrate Australia’s longstanding bipartisan consensus on free trade, and—once the agreement is signed—ensure it goes through parliamentary processes smoothly.’