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Australia finalises free trade agreement with South Korea Australia finalises free trade agreement with South Korea
(about 1 hour later)
Australia has finished negotiations for a free trade agreement with South Korea, paving the way to reduce and scrap tariffs on key exports, the prime minister says.Australia has finished negotiations for a free trade agreement with South Korea, paving the way to reduce and scrap tariffs on key exports, the prime minister says.
The proposed deal includes a controversial investor-state dispute settlement mechanism – but the government says it has secured safeguards to ensure Australia’s public welfare, health and environmental laws are not undermined.The proposed deal includes a controversial investor-state dispute settlement mechanism – but the government says it has secured safeguards to ensure Australia’s public welfare, health and environmental laws are not undermined.
Labor and the Greens have already flagged their concern over this aspect of the agreement, urging the government to release the full wording as soon as possible.
Tony Abbott told parliament his trade minister, Andrew Robb, had concluded negotiations with Australia’s third largest export market. The prime minister said the agreement – yet to be approved by cabinet – would mean the removal of tariffs on Australia’s major exports to South Korea, including beef, wheat, dairy, sugar, wine, seafood, grapes, cherries and mangoes.Tony Abbott told parliament his trade minister, Andrew Robb, had concluded negotiations with Australia’s third largest export market. The prime minister said the agreement – yet to be approved by cabinet – would mean the removal of tariffs on Australia’s major exports to South Korea, including beef, wheat, dairy, sugar, wine, seafood, grapes, cherries and mangoes.
Beef tariffs would be phased out over 15 years, restoring Australia's competitive position in a key market, Abbott said.Beef tariffs would be phased out over 15 years, restoring Australia's competitive position in a key market, Abbott said.
“Conclusion of this agreement will be good news for our exporters, good news for our farmers, good news for jobs, good news for growth, and good news for Australia,” he said.“Conclusion of this agreement will be good news for our exporters, good news for our farmers, good news for jobs, good news for growth, and good news for Australia,” he said.
A fact sheet provided by the government acknowledges some sectors could face increased competition from imports of South Korean products and services, such as motor vehicles and parts, steel products and textiles, clothing and footwear. But it said this was “in line with the progressive liberalisation already under way” in the Australian economy.A fact sheet provided by the government acknowledges some sectors could face increased competition from imports of South Korean products and services, such as motor vehicles and parts, steel products and textiles, clothing and footwear. But it said this was “in line with the progressive liberalisation already under way” in the Australian economy.
Critics had been worried about the inclusion of an investor-state dispute settlement mechanism, allowing overseas businesses to take action against Australia for apparent breaches.Critics had been worried about the inclusion of an investor-state dispute settlement mechanism, allowing overseas businesses to take action against Australia for apparent breaches.
The government says the agreement does include such a mechanism, but has “ensured the inclusion of appropriate carve-outs and safeguards in important areas such as public welfare, health and the environment”.The government says the agreement does include such a mechanism, but has “ensured the inclusion of appropriate carve-outs and safeguards in important areas such as public welfare, health and the environment”.
“This will provide new protections for Australian investors in Korea as well as Korean investors in Australia, promoting investor confidence and certainty in both countries,” it says.“This will provide new protections for Australian investors in Korea as well as Korean investors in Australia, promoting investor confidence and certainty in both countries,” it says.
The shadow trade minister, Penny Wong, said the mechanism was “a particular matter of concern for Labor” and called for the details to be released at the earliest opportunity.
Wong said the free trade agreement presented significant opportunities for Australian exporters and workers, but also potential challenges for the sectors that would face greater competition.
The deal must go to the cabinet for approval, while Korea has its own approval processes. The document will then be tabled in parliament and considered by the joint standing committee on treaties.The deal must go to the cabinet for approval, while Korea has its own approval processes. The document will then be tabled in parliament and considered by the joint standing committee on treaties.
The treasurer, Joe Hockey, said the deal would ensure no tariffs were added to sugar exported from Australia to Korea. “That is a huge win for north Queensland, and a huge win for Australia, so we are delivering the goods,” Hockey said.The treasurer, Joe Hockey, said the deal would ensure no tariffs were added to sugar exported from Australia to Korea. “That is a huge win for north Queensland, and a huge win for Australia, so we are delivering the goods,” Hockey said.
The agriculture minister, Barnaby Joyce, said modelling by the Centre for International Economics suggested the agreement would double Australia’s beef exports to Korea by 2030, expected to be worth an extra $846m a year.
Some tariffs will be removed immediately while others will be phased out over time.Some tariffs will be removed immediately while others will be phased out over time.
Abbott said Australia would gain from new market openings in services and investment. He argued the beneficiaries would include Australian automotive suppliers, with the immediate removal of tariffs as high as 8%; the wine industry (15% tariffs); and wheat growers, potato farmers and cherry, grape and mango producers.Abbott said Australia would gain from new market openings in services and investment. He argued the beneficiaries would include Australian automotive suppliers, with the immediate removal of tariffs as high as 8%; the wine industry (15% tariffs); and wheat growers, potato farmers and cherry, grape and mango producers.
Abbott credited the former government with starting negotiations in 2009 and Robb with concluding the talks. The opposition leader, Bill Shorten, welcomed the progress, saying the Asian century was at the centre of national debate and a free trade agreement with South Korea offered significant opportunities for Australia.Abbott credited the former government with starting negotiations in 2009 and Robb with concluding the talks. The opposition leader, Bill Shorten, welcomed the progress, saying the Asian century was at the centre of national debate and a free trade agreement with South Korea offered significant opportunities for Australia.
Shorten requested a briefing to ensure the elements were in line with Australia’s national interest.Shorten requested a briefing to ensure the elements were in line with Australia’s national interest.
The Greens' trade spokesman, Peter Whish-Wilson, said he was concerned about what the government had traded away to achieve the deal.
"The investor-state dispute resolutions provision exposes future governments to being sued for simply making laws on behalf of their citizens," he said.
"We have no confidence that there are any safeguards in place to prevent a litigation free-for-all that would reduce the sovereignty of our national and state parliaments."
The website of the Department of Foreign Affairs and Trade says its objective in the negotiations was to put Australian exporters on an equal footing with United States and European Union competitors, which had obtained improved access to the South Korean market through their own free trade agreements.The website of the Department of Foreign Affairs and Trade says its objective in the negotiations was to put Australian exporters on an equal footing with United States and European Union competitors, which had obtained improved access to the South Korean market through their own free trade agreements.
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