NFF welcome breakthrough on revamped TPP minus protectionist US

NFF welcome breakthrough on revamped TPP minus protectionist US


Politics
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NFF CEO Tony Mahar has welcomed overnight news about concluding the Trans-Pacific Partnership but still wants details on actual tariff cuts.

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NFF CEO Tony Mahar.

NFF CEO Tony Mahar.

NATIONAL Farmers’ Federation (NFF) CEO Tony Mahar has welcomed overnight news that the 11 remaining countries in the Trans-Pacific Partnership (TPP) negotiations have indicated they’re ready to sign the ground-breaking trade deal.

And Mr Mahar says he’s hoping the new agreement can be “fast-tracked” but is still waiting on details of specific tariff cuts for farm products to be revealed, in the reformed deal, minus the powerful US which withdrew early last year under the protectionist regime of President Donald Trump.

Australian Trade Minister Steven Ciobo said Australia had worked hard to deliver the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) because it would “drive” Australian exports and create new Australian jobs.

"It hasn't been easy, but we're finally at the finish line and Aussie businesses will be the big winners,” he said.

"The CPTPP will eliminate more than 98 per cent of tariffs in a free trade zone with a combined GDP of AUD 13.7 trillion.

“The agreement will deliver 18 new free trade agreements between the CPTPP parties.

“For Australia that means new trade agreements with Canada and Mexico and greater market access to Japan, Chile, Singapore, Malaysia, Vietnam and Brunei.

Australian Trade Minister Steven Ciobo.

Australian Trade Minister Steven Ciobo.

"Labor and Bill Shorten declared this trade agreement dead and wanted to walk away.

“If Labor got their way, Bill Shorten would have shut Australia out of this historic agreement and denied our farmers, manufacturers and services providers the big wins the CPTPP delivers.”

Significant wins for Australian exporters under CPTPP include:

  • * accelerated reductions in Japan’s import tariffs on beef, where Australian exports were worth $2 billion in 2015-16;
  • * elimination of a range of cheese tariffs into Japan covering over $100 million of trade that was not covered by the Japan-Australia Economic Partnership Agreement;
  • * new quotas for wheat and rice to Japan, also for sugar into Japan, Canada and Mexico;
  • * elimination of all tariffs on sheep meat, cotton, wool, seafood, horticulture, wine and industrial products (manufactured goods)

The text of the agreement is now undergoing a legal review and translation and will be made public on a date to be agreed by all parties.

Mr Mahar said the NFF understood the 11 remaining countries were now going to meet and sign the new CPTPP in March.

“We’ve been supportive of the TPP since its inception and we’ve spent a considerable amount of time over the past few years working with government and helping to provide information to them and also working with other countries to ensure agriculture is central to the agreement,” he said.

“We remain supportive and we’re pleased that Australia and the 10 other countries have finally agreed to it.

“It has happened before where they’ve agreed to it and it hasn’t actually achieved entry into force after being ratified but we’re hopeful this time that it does come into force and is ratified and of course we look forward to March where it ultimately gets signed.”

Mr Mahar said the new deal still needed to pass the Australian parliament’s approval processes but the NFF was “very pleased” the 11 remaining countries had been able to agree to a comprehensive agreement.

“If they sign the TPP in March it still has to go through our parliament and the parliaments of the other countries,” he said.

“I’d like to say it’d be fast tracked in terms of, most of the other countries got close to reviewing it and assessing it and having it put through their government processes last time.

“That being said it obviously has to go through the government processes here – the Joint Standing Committee on Treaties (JSCOT) plus any other House or Senate committee inquiries.

“But we’ve been prudent in terms of talking to the opposition and maintaining or getting their commitment to support for trade including having talks with Jason Clare (Shadow Trade Minister) where he committed to us that the Labor party did have a bipartisan and supportive approach to trade which we were very pleased to hear.

“But we still need the detail and to get it analysed and to go through the regular government processes like the JSCOT.”

Agriculture and Water Resources Minister David Littleproud said he congratulated Minister Ciobo on his “great work in this space” and welcomed tariff cuts on farm produce.

“The proposed abolition of Japan’s tariffs on our cheeses, wine, sheep meat, horticulture, cotton, wool, and seafood is all great news for our farmers,” he said.

“Reductions in Japan’s tariffs on our beef and new quotas for wheat, sugar and rice to Japan, as well as sugar into Japan, Canada and Mexico, are also great news.

“Aussie farmers want choice when they want to sell their product and we’re delivering that by opening new markets and reducing tariffs and trade barriers.

“This all leads to better farm gate prices, which is what we all want.”

More details please

Talks on the TPP started in 2008 with a deal signed by former federal Trade Minister Andrew Robb in mid-2015, which he said at the time represented 40pc of global trade between the 12 countries involved.

Mr Mahar said the NFF was still waiting to see actual the details of the new agreement but stressed things had changed since the US left 12-months ago.

“Given it has only been news overnight we don’t have the exact numbers on what it will mean,” he said.

“If we go off the last agreement that was provided, Australia exported about $16 billion worth of agricultural products to those markets and if you take the US out of that it will be less but it was about 30pc of Australian agricultural products going to TPP countries.

“More preferential arrangements in those markets will only be a good thing but what it means in terms of actual dollars we don’t know yet because we don’t actually have the tariff numbers of specific sectors.

“However, it’s going to be a good thing for farmers in terms of more market access and the key thing is, it gives preferential market access, in these markets.

“What I’m hearing is we will need a separate bilateral agreement with Canada and Mexico which we don’t have currently with those countries and we’re waiting to see what that means.

“And off the back of the Japan arrangement I understand there are better arrangements, or more preferential arrangements, on top of the Japan economic agreement.”

Mr Mahar said the US was obviously a “huge market” and their removal form the TPP equation would have some impact.

“When the TPP was originally signed sugar was a beneficiary in that market and there was an extra 60,000 tonnes going to the US market which was a significant achievement because sugar into the US has always been extremely difficult,” he said.

“We’re still waiting to see the details on what that means - but we’ll continue to trade with the US and they’re an important partner.

“However, the good thing about the TPP is it allows other countries to come in, so if the US decided it wanted to come back in, and it would take some negotiation and consideration, but the door’s open for the US and other countries to come into the TPP.”

Mr Mahar said market access and trade was “critical” to Australian agriculture, given two thirds of local produce was exported and Australian farmers were “always on the lookout for new markets”.

He said the TPP, represented “a new style of agreement and was a “new milestone” where the 11 countries were agreeing to a new consistent set of trade rules.

“It provides for an across the supply chain type of approach,” he said.

“For example Australian cotton could be exported to Vietnam then made into garments and exported to another country and all of that is included in the TPP.

“It’s a plurilateral agreement as opposed to a bilateral agreement.

“The more we have countries agreeing to liberalising trade and reducing tariffs it will have benefits for Australian farmers in terms of providing more opportunities to sell their food and fibre and more competitive opportunities to sell their food and fibre.

“The TPP will take a little while to flow through, depending on how quickly it can be ratified but ultimately more market access means better opportunities for Australian farmers.”

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