Breaking down non-tariff barriers to valuable export markets

Breaking down non-tariff barriers to valuable export markets


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Trade Minister Simon Birmingham. Photo by Alex Ellinghausen.

Trade Minister Simon Birmingham. Photo by Alex Ellinghausen.

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Government launches action plan to tackle red tape and costs imposed on Australian trade

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The federal government has launched a new initiative to reduce the costs and red tape confronting Australian exporters in international markets.

Free trade agreements have removed or lowered tariffs on Australian agricultural exports in some of our key markets in recent years, particularly in the Asia-Pacific.

But in some instances our trading partners stymie market access with non-tariff barriers that fall outside the trade agreements.

The government today launched an Action Plan to identify and reduce non-tariff barriers, which it is estimated could deliver 10 times the benefit of halving tariffs.

While these restrictions may be against international rules, securing resolution through the World Trade Organisation is notoriously difficult.

Trade Minister Simon Birmingham said other countries are entitled to to set trade rules to protect their interests, but in some instances unnecessary rules had been imposed at great cost to Australian exporters.

“Tariffs and quotas are there for the whole world to see, but as we continue to shift towards a more open global economy, we’re seeing a trend towards the use of hidden or invisible trade barriers,” Mr Birmingham said.

“Whilst many of these requirements are legitimate, we’re seeing a shift towards how regulations and red-tape are being manipulated and used as a deliberate tool to distort trade flows and protect domestic industries.”

Non tariff barriers

Cherries to China

Australian cherries gained access to China in 2013 and now the $13 million market is one of the most valuable for producers.

However, Australian producers were required to treat their cherries with a costly and time-consuming process that reduced the value of their crops.

The federal government negotiated a new agreement with the Chinese Government which reduced the two-week process to a two-hour procedure.

Chilled meat to the Middle East

Industry calculated restrictions on chilled red meat in the United Arab Emirates costs Australian exporters around $60m a year.

The UAE is one of Australia’s largest red meat markets in the Middle East and the short shelf life meant there was little time for vendors to sell the meat.

Government and industry teamed up to argue the case to UAE regulators for an extended shelf life for vacuum-packed chilled meat.

In 2017, the UAE increased its maximum shelf life from 90 days to 120 days for vacuum-packed beef and from 70 days to 90 days for sheep meat.

Wine to Vietnam

In 2015 Vietnam imposed regulations that limited the use of common wine additives and processing aids.

The government and the Winemakers’ Federation of Australia lobbied for their use, and in January Vietnam temporarily approved the use of all Australian processing aids and 17 common additives, which Australia aims to make permanent.

Other hurdles

There are 245 non-tariff barriers, which cost $3.4 billion a year across 41 red meat export markets, according to a 2017 report by Meat and Livestock Australia and Australian Meat Industry Council.

Grain Growers Association reported this year tat 54 non-tariff measures across 15 markets significantly restrict market access or add cost.

Reaction

Australian Industry Group chief executive Innes Willox praised the government for addressing one of exporters’ key concerns.

“It has been calculated that halving trade facilitation costs could deliver nearly ten times the benefit of halving tariffs,” Mr Wilcox said.

National Farmers’ Federation president Fiona Simson said the government’s Action Plan would provide tangible outcomes in the near future.

“It will make it easier for exporters to report barriers when they arise, and arm our front-line officials with the information needed to tackle these barriers,” Ms Simson said.

“Over time, the plan will provide the data needed to assess those actions that have been effective, those that have not, and what more industry and government can do together to bring down non-tariff barriers.”

Exporters can read the new Action Plan and report non-tariff trade barriers at: www.tradebarriers.dfat.gov.au.

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