More great news for the agriculture sectors: Korea – Australia FTA
12 December 2014
Australian Agriculture Minister, Barnaby Joyce, has warmly welcomed the entry into force today, 12 December 2014, of the landmark Korea-Australia Free Trade Agreement (KAFTA).
This follows the passing of KAFTA by the parliaments of both countries, and the exchange of diplomatic notes by the two governments formally agreeing to its entry into force today.
Minister Joyce said this early entry into force of KAFTA before the end of 2014 would be doubly welcome to Australia’s agriculture, food, fisheries and forestry sectors, as it meant two tariff cuts in rapid succession – the first immediately on 12 December, and a second tariff cut on 1 January 2015.
“Korea is Australia’s third largest beef market valued at $788 million in 2012. Australian beef exporters have had to face a 40 per cent tariff on beef, but on 12 December it will fall to 37.3 per cent, and then again on 1 January 2015 down to 34.7 per cent,” Minister Joyce said.
"The beef tariff will be progressively eliminated over 15 years under this agreement – but the early entry into force gives us an accelerated start to the reductions, and helps us make up ground faster with our US competitors.
”Australia’s important citrus trade will also benefit from the double tariffs cuts, with the high seasonal tariff dropping to 30 per cent now and to 25 per cent on 1 January 2015.”
Minister Joyce also highlighted the immediate tariff elimination on a number of key commodities.
The 3 per cent tariff on sugar will be eliminated on 12 December, helping strengthen Australia’s competitive position as the largest sugar supplier to the Korean market.
“The Australian Government remains committed to increasing returns at the farm gate for our growers and producers by opening new markets and business opportunities,” Minister Joyce said.
“This trade agreement gives Australian farmers improved access to the Korean market with 98 per cent of Australia’s agricultural exports facing zero tariffs once the rollout of the agreement is complete.
“Korea is our fifth largest export market with our agricultural exports valued at $2.3 billion.
“This agreement, along with those struck with our largest and second largest agricultural export markets – China, valued at $9 billion, and Japan valued at $3.8 billion – will bring benefits to many Aussie producers.
“The KAFTA means our beef, dairy, grains, sugar, horticulture, seafood and wine sectors will all achieve better access.
“While some commodities are excluded, this agreement represents the best outcome we could achieve at this time and we look forward to our new relationship prospering.”
For more information visit dfat.gov.au/fta/kafta.
Table of outcomes in key commodities available on request.