Just over a year after US President Donald Trump withdrew from the TPP, the remaining countries have signed the agreement in Chile, with hope to ratify it by 2019.
Whilst there has been criticism on the overlap between Australia’s existing free trade agreements, we currently have agreements in place with eight of the 10 other TPP members, it will have a big impact on Australian importers and exporters, some advantages include:
- Opening up of the Canadian and Mexican markets
- Easier certification requirements, it will be easier to qualify for lower duty rates under the TPP than under Australia’s existing free trade agreements.
- New Countries are able to join, the more countries that join, the more likely the TPP could become the default free trade agreement.
- One of the biggest benefits appears to be for farmers, the elimination on dairy products into Japan will be a highlight as in the past, the US has been a real cost competitor.
The TPP may also weaken the advantage Australia had over other countries, for example, not all TPP members had existing agreements with Japan. The entry of the TPP will mean Australia will again be on level pegging with other TPP members.
We will continue to monitor the progress of the agreement and once further information is available, we will be able to review and recommend options for our clients importing or exporting to/from a TPP member country.