Australia's Largest Free Trade Agreement With ASEAN Starts

04/01/2010
By Neville Dcruz

MELBOURNE, Jan 4 (Bernama) -- Australian Trade Minister Simon Crean welcomed the start of Australia's largest free trade agreement (FTA), the Asean-Australia-New Zealand Free Trade Agreement, saying the FTA is an important building block towards deepening Australia's economic integration with the dynamic Asian region.

The historic agreement will span 12 economies with more than 600 million people and a combined Gross Domestic Product (GDP) of A$3.1 trillion.

The commencement of this agreement is a major milestone and opens up significant opportunities for Australian businesses in one of the world's fastest-growing regions, he said in a statement on Monday.

With Asia leading the global economic recovery and with six out of 10 Asean markets expected to register double-digit growth this year as forecast by the Organisation for Economic Cooperation and Development (OECD), there is great potential for Australian exporters to enter new markets, he said.

As of today, the agreement covers around 70 per cent of Australia's trade with Asean countries with which "we do not have bilateral FTAs," Crean said.

The agreement includes immediate removal of a 10 per cent tariff on A$9.6 million Australian processed cheese exports (in 2008) to Malaysia and abolition of a five per cent tariff on A$7.2 million fresh grapes export to Malaysia.

"By 2020, the deal will eliminate tariffs on 96 per cent of our current exports to Asean nations," Crean said.

Asean accounted for 15 per cent of Australia's trade worth A$83 billion in 2008 and 2009 which was as large as Australia's trade with China, the country's biggest trading partner.

The Asean-Australia-New Zealand Free Trade Agreement is Australia's first multi-country FTA and the most comprehensive FTA ever concluded by Asean.

In addition to Australia and New Zealand, the FTA was binding on Brunei, Myanmar, Malaysia, the Philippines, Singapore and Vietnam.

Indonesia, Cambodia, Laos and Thailand are expected to ratify the agreement early this year.

"I urge the Australian business community to take full advantage of the many benefits that this far-reaching agreement has to offer," Crean added.

-- BERNAMA