Boris and Prime Minister Albanese look forward to UK-Australia Free Trade Agreement coming into force

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Prime Minister Boris Johnson attends NATO in Madrid. The Prime Minister Boris Johnson meets with the Prime Minister of Australia Anthony Albanese attends the Nato meeting in Madrid, Spain. Picture by Andrew Parsons / No 10 Downing Street

Prime Minister Boris Johnson met with Australian Prime Minister Anthony Albanese at the NATO Summit in Madrid this morning (29 June 2022).

The Prime Minister welcomed Australia’s participation in the Summit as the largest non-NATO contributor.

The leaders agreed on the importance of supporting Ukraine and ensuring Putin’s vainglorious conquest ends in failure. Protecting human rights and territorial sovereignty is in everyone’s interests, and the ramifications of Putin’s action and our response will be felt around the world.

The Prime Minister and Prime Minister Albanese both welcomed the AUKUS pact, which is promoting stability and security across the Indo-Pacific. They said they looked forward to working more together to boost prosperity and create jobs in both our countries, including when the UK-Australia Free Trade Agreement comes into force.

The deal is expected to increase trade with Australia by 53%, boost the economy by £2.3 billion and add £900 million to household wages in the long-run.

This trade deal goes further than Australia has ever gone before in giving services companies access to the Australian market. This means that UK services from architecture and law to financial services and shipping will be able to compete in the Australian market on a guaranteed equal footing. This could increase exports of UK services to Australia, currently worth over £5 billion per year.

The removal of UK tariffs on Australian favourites like Jacob’s Creek and Hardys wines, Tim Tams, swimwear, surfboards, and boots will boost choice for British consumers. UK manufacturers will benefit from cheaper access to important Australian machinery parts like hydraulic power engines and pressure-reducing valves which will allow them to be more competitive and grow their businesses.

The deal also removes tariffs on all UK exports to Australia, making it cheaper to sell iconic products like cars, Scotch whisky and UK fashion to Australia. This will support industries that employ over 3.4 million people in the UK. Flexible rules of origin mean that UK businesses can use some imported parts and ingredients and still qualify for the new 0% tariffs when exporting to Australia.

UK investors will also benefit from more access than ever before to opportunities in Australia, with guaranteed rights to invest across the Australian economy. The majority of UK investments will no longer need to be reviewed by the Australian Foreign Investment Review Board – saving time, saving money and cutting red tape for UK investors.

For the first time UK service suppliers including architects, scientists, researchers, lawyers and accountants will have access to visas to work in Australia without being subject to Australia’s changing skilled occupation list. This is more than Australia has ever offered any other country in a free trade agreement, and will improve long-term planning for British businesses.

As part of the overall mobility package, Brits aged 18 to 35 will be able to travel and work in Australia with a Working Holiday Maker Visa for up to 3 years, deepening the people-to-people and cultural links between our two countries. Young people will no longer have to work on a farm to use this visa to live and work in Australia.

The deal provides more opportunities for UK firms to trade digitally with Australia, including in British tech, creative industries, finance, telecommunications, and many other sectors. It secures the free flow of data necessary for British businesses to provide many products and services to customers, while locking-in a legal requirement for personal data protection in both countries. The deal will save many firms from the cost of setting up servers in Australia, and it makes business easier through the use of electronic contracts and electronic signatures.

Australia also strongly supports UK membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which would open up 11 markets worth £8.4 trillion GDP for British exporters and investors. Australia itself is projected to be a top 10 global economy by 2050. Early access to trading opportunities in this region will secure superior access for UK exporters to these growing markets, with two thirds of global middle-class consumers expected to be in Asia by 2030.

The Prime Minister welcomed Australia’s enhanced climate NDC. The leaders agreed that Australia has incredible potential to be a world-leader in the use of renewables and make the hyper leap away from coal and other fossil fuels. The leaders also agreed on the need to help developing countries grow in a clean and sustainable way.

For more information on the UK-Australia Free Trade Agreement click here.

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