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UK and Australia agree broad terms of trade deal UK and Australia announce new trade deal
(about 4 hours later)
Scott Morrison and Boris Johnson agreed the broad terms of the deal over dinner Boris Johnson and Scott Morrison agreed the broad terms of the deal over dinner on Monday
The broad terms of a trade deal between the UK and Australia have been agreed, the BBC understands, with a formal announcement expected on Tuesday. A trade deal between the UK and Australia has been agreed between Prime Minister Boris Johnson and his counterpart, Scott Morrison.
UK Prime Minister Boris Johnson and Australian PM Scott Morrison agreed the deal over dinner at Downing Street. Downing Street said the new pact meant British products such as cars, Scotch whisky, biscuits and ceramics would be cheaper to sell to Australia.
This is the first trade deal to be negotiated from scratch since the UK left the EU. However, there has been concern from UK farmers over the deal.
The agreement is the first trade deal to be built from scratch since the UK left the EU.
It is seen as an important step towards the UK joining a wider Asia Pacific free-trade agreement.It is seen as an important step towards the UK joining a wider Asia Pacific free-trade agreement.
"Today marks a new dawn in the UK's relationship with Australia, underpinned by our shared history and common values," Mr Johnson said in a statement:
"Our new free trade agreement opens fantastic opportunities for British businesses and consumers, as well as young people wanting the chance to work and live on the other side of the world.
"This is global Britain at its best - looking outwards and striking deals that deepen our alliances and help ensure every part of the country builds back better from the pandemic."
The UK government has signed a long list of trade deals over the past year, but they have been rollovers of those the UK already had as part of the EU.The UK government has signed a long list of trade deals over the past year, but they have been rollovers of those the UK already had as part of the EU.
Why is an Australia trade deal controversial?Why is an Australia trade deal controversial?
'Safeguards' promise over UK-Australia trade deal'Safeguards' promise over UK-Australia trade deal
Farmers' opposition to UK-Australia trade deal growsFarmers' opposition to UK-Australia trade deal grows
Food and drink sector criticise Australia trade dealFood and drink sector criticise Australia trade deal
The new trade deal is expected to give UK and Australian food producers and other businesses easier access to each other's markets - an ambition perhaps alluded to by the meal served up to the pair on Monday evening - Welsh lamb and Scottish smoked salmon, washed down with Australian wine. Mr Johnson and Mr Morrison agreed the deal over dinner on Monday.
The new trade deal gives UK and Australian food producers and other businesses easier access to each other's markets - an ambition perhaps alluded to by the meal served up to the two prime ministers - Welsh lamb and Scottish smoked salmon, served with Australian wine.
The UK government says membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) could provide British farmers with huge opportunities.The UK government says membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) could provide British farmers with huge opportunities.
However, there have been concerns in the farming community about the UK compromising on its food standards, as well as tensions in government between the Environment Secretary, George Eustice, and the Trade Secretary, Liz Truss.However, there have been concerns in the farming community about the UK compromising on its food standards, as well as tensions in government between the Environment Secretary, George Eustice, and the Trade Secretary, Liz Truss.
'We don't have enough beef to flood the UK market''We don't have enough beef to flood the UK market'
UK farmers also have concerns there will be no meaningful safeguards in place to stop farmers being undercut by cheap imports.UK farmers also have concerns there will be no meaningful safeguards in place to stop farmers being undercut by cheap imports.
Farmers in Australia are allowed to use some hormone growth promoters, pesticides, and feed additives that are banned in the UK.Farmers in Australia are allowed to use some hormone growth promoters, pesticides, and feed additives that are banned in the UK.
According to the National Farmers Union (NFU), Australian farmers are able to produce beef at a lower cost of production, and could undercut farmers in the UK.According to the National Farmers Union (NFU), Australian farmers are able to produce beef at a lower cost of production, and could undercut farmers in the UK.
Scotland had raised worries about the farming industry being overwhelmed if the market was flooded with lower standard goods.Scotland had raised worries about the farming industry being overwhelmed if the market was flooded with lower standard goods.
With the two leaders in the same room, sitting at the same dinner table, the UK trade agreement with Australia is now tangible. Both prime ministers can draw on the significance of striking the first deal after the UK has left the EU.
Australian farmers have essentially been locked out of the UK market for almost 50 years - finding it nearly impossible to navigate Brussels' restrictions, tariffs and quotas. The president of the Australian National Farmers' Federation said it had been very difficult to break into the UK because it was "way too expensive and way too far".
But with tariffs and quotas likely to be removed within 15 years - a detail expected in the agreement - it opens up a much-coveted area for the Australian agricultural industry.
On any given day this would be huge news, but it's even more significant now as Aussie farmers look to diversify due to the increased tensions between Canberra and Beijing. In the past year, China has slapped tariffs and restrictions on everything from Australian beef, barley and wine, to rock lobster and coal.
UK farmers have big concerns. They see the potential importation of cheap Australian produce at lower standards on an industrial scale as a real threat to their livelihoods. They've been assured that safeguards will be in place but we have yet to hear what these are exactly.
This deal sets the tone as the world watches closely to see what a post-Brexit British economy looks like in action. How free it really is. How it's changed. More crucially, what compromises it's willing to make to open up new markets.
The Department for International Trade has previously said any deal with Australia would include protections for the agriculture industry and not compromise the UK's high standards.The Department for International Trade has previously said any deal with Australia would include protections for the agriculture industry and not compromise the UK's high standards.
Trade Secretary Liz Truss defended plans for a deal with Australia last month, telling MPs: "We will make sure in all the deals we do that British farming thrives."Trade Secretary Liz Truss defended plans for a deal with Australia last month, telling MPs: "We will make sure in all the deals we do that British farming thrives."
In 2019-20, trade in goods and services between Australia and the UK was valued at £20.1bn.In 2019-20, trade in goods and services between Australia and the UK was valued at £20.1bn.
Metals, wine and machines have formed the biggest goods exports from Australia to the UK, while Australia's main UK imports are cars, medicines and alcoholic drinks.Metals, wine and machines have formed the biggest goods exports from Australia to the UK, while Australia's main UK imports are cars, medicines and alcoholic drinks.
Trade in meat between the two countries is small, with 0.15% of all Australian beef exports going to the UK and 14% of sheep meat imports to the UK coming from Australia. Trade in meat between the two countries is small at present, with 14% of sheep meat imports to the UK coming from Australia and just 0.15% of all Australian beef exports going to the UK.