Eighteen months after it was signed, the Australia-United Kingdom Free Trade Agreement (A-UK FTA) entered into force on 31 May 2023– an agreement our Prime Minister considers as one of the most comprehensive, innovative and ambitious free trade agreements concluded by Australia to date.
Effect of the A-UK FTA
This "gold-standard" trade agreement is set to deliver unprecedented benefits to Australian businesses and create new well-paying jobs, including the elimination of tariffs on over 99% of Australian goods exported to the UK and reduction of other trade barriers. The A-UK FTA will also regulate digital trade, make it easier for Australian companies and individuals to operate in the UK market and raise the investment screening threshold to match that given to other key Australian investment partners with whom Australia has a free trade agreement.
Australian exports which can now enter the UK duty free include wine, short and medium grain rice, sugar, honey, nuts, olive oil and food supplements. UK tariffs on Australian industrial goods, such as auto parts, electrical equipment and fashion items are also now eliminated, and Australian agricultural products, including beef and sheep meat, sugar and dairy products, will have duty free transitional quotas, with eventual elimination of all tariffs.
Notably, the A-UK FTA also strengthens the people-to-people links between Australia and the UK. Australian professionals now have the same access to the UK job market as nationals from the European Union, except the Republic of Ireland. From 31 January 2024, Australians up to the age of 35 (up from 30) will be able to apply for working holidays in the UK and stay for a maximum of three years instead of two.
The two-way goods and services trade between the UK and Australia was worth $10 billion and over $11 billion in 2021-22 respectively. The Minister for Trade and Tourism has stated that this agreement "creates new opportunities to deepen and expand trade and investment with one of Australia’s most important and longstanding trading partners."