Australia-UK Free Trade Deal
United Kingdom and Australia has signed a free trade deal on June 15, 2021. This trade deal eliminates tariffs on wide range of goods. This deal was signed following UK’s exit from European Union. With this deal, U.K. seeks to expand links across the world.
Significance of the deal
- This deal is expected to boost exports of traditional British products like Scotch whisky. It will also boost imports of lamb and wine from Australia.
- Deal will also help it join “Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)”. CPTPP is considered as a gateway of increasing trade throughout Asia-Pacific region.
- It will reduce tariffs on products clothing & cars and reduce levies on agricultural products. However, reduction of levies on agricultural products sparked a backlash from farming sector in UK. They are of the view that, they would be undercut by cheap meat imports from Australia.
With which countries UK is having trade deal?
U.K. is having free trade deals with seven of 11 CPTPP members viz., Australia, Chile, Japan, Canada, Mexico, Singapore and Vietnam. Free trade deal with Australia is UK’s first trade deal that was negotiated from scratch since UK left the EU. Deals with Japan and Canada were built on existing agreements struck by EU.
UK-Australia Relation
UK is Australia’s fifth largest trading partner. Goods and services from both the sides is valued at 36.6 billion Australian dollars in a year. UK’s trade with Australia is about 1.2% of its total trade in 2020.
Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)
CPTPP, also known as TPP11 or TPP-11, is a trade agreement among Australia, Brunei, Chile, Malaysia, Canada, Japan, Mexico, New Zealand, Singapore, Peru and Vietnam. It evolved from Trans-Pacific Partnership (TPP), that never entered into force because of withdrawal of United States.
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Month: Current Affairs - June, 2021