Australia’s Trade Agreements
Trans-Pacific Partnership Agreement
Japan, Canada and Mexico have formally expressed interest in joining the TPP negotiations. Australia and other TPP countries have welcomed this interest and will now begin by undertaking a bilateral process with these countries to discuss their readiness to join, and their capacity to maintain both the ambition and pace of the negotiations. This is the same process that each TPP country undertook when they sought to join the TPP, with final decisions taken by a consensus of all current TPP parties.
To assist in this process we would welcome further submissions and comments from stakeholders considering Japan, Canada and Mexico's possible involvement in the TPP. Submissions can be made by email to tpp@dfat.gov.au. Please note all submissions will be made publicly available on the DFAT website unless the author specifies otherwise.
About free trade agreements
Across the globe, there is an expanding network of free trade agreements (FTAs). High-quality, comprehensive free trade agreements can play an important role in supporting global trade liberalisation and are explicitly allowed for under the World Trade Organization (WTO) rules.
FTAs can cover entire regions with multiple participants or link just two economies. Under these agreements, parties enter into legally binding commitments to liberalise access to each others' markets for goods and services, and investment. FTAs also typically address a range of other issues such as intellectual property rights, government procurement and competition policy.
The government will not enter into any trade agreement that falls short of the benchmarks set by the WTO or the benchmarks we set ourselves of high-quality, truly liberalising trade deals that support global trade liberalisation.
Australia has six FTAs currently in force with New Zealand, Singapore, Thailand, US, Chile and (with New Zealand) the Association of South East Asian Nations (ASEAN). The countries covered by these FTAs account for 28 per cent of Australia's total trade.
Nine more FTAs are under negotiation, including with China, Japan and the Republic of Korea. The countries covered by these negotiations account for a further 44 per cent of Australia's trade.
FTAs are helping Australian exporters access new markets and expand trade in existing markets.
FTAs in force
- ASEAN-Australia-New Zealand FTA
- Australia-Chile FTA
- Australia-New Zealand Closer Economic Relations
- Australia-United States FTA
- Singapore-Australia FTA
- Thailand-Australia FTA
FTAs concluded and undergoing domestic approval processes
FTAs under negotiation
- Australia-China FTA
- Australia-Gulf Cooperation Council (GCC) FTA
- Australia-India Comprehensive Economic Cooperation Agreement
- Australia-Japan FTA
- Australia-Korea FTA
- Indonesia-Australia Comprehensive Economic Partnership Agreement
- Pacific Agreement on Closer Economic Relations (PACER) Plus
- Trans-Pacific Partnership Agreement
Related information
News
MAFTA Signed
Minister for Trade and Competitiveness, Craig Emerson, and Malaysia's Minister for Trade and Industry, Mustapa Mohamed, signed the Malaysia-Australia Free Trade Agreement (MAFTA) in Kuala Lumpur on 22 May 2012.
MAFTA negotiations were finalised on 30 March 2012, consistent with a commitment by Prime Minister Gillard and Malaysia's Prime Minister Najib to conclude within 12 months of their March 2011 meeting in Canberra.
Media release: Australia and Malaysia sign free trade agreement, 22 May 2012.
ASEAN-Australia-New Zealand FTA (AANZFTA) enters into force for Indonesia
Australia welcomed entry-into-force for Indonesia on 10 January 2012. AANZFTA is now in force for all 12 signatories: Australia, Brunei Darussalam, Burma, Cambodia, Indonesia, Laos, Malaysia, New Zealand, Philippines, Singapore, Thailand and Vietnam.
At the inaugural Indonesia-Australia Annual Leaders' meeting, 20 November 2011 in Bali, Indonesia, Prime Minister Gillard and President Yudhoyono stated in their Joint Communique, “Great potential exists to promote trade and investment links between the two economies — the two largest in the region. We welcomed the entry into force of the ASEAN-Australia-New Zealand Free Trade Agreement and committed to commence negotiations on an Indonesia-Australia Comprehensive Economic Partnership Agreement at the earliest opportunity”.
More information: ASEAN-Australia-New Zealand FTA
Amendments to the Singapore-Australia FTA
Singapore and Australia have completed the second review of the Singapore-Australia Free Trade Agreement (SAFTA). The amendments entered into force on 2 September 2011.
The second review amended Chapters 8, 10, and 13 as well as Annexes 3A, 4-I(A), 4-II(A), 4-I(B) and 4-II(B). Key changes include:
- Singapore and Australia to accord investors from each country fair and equitable treatment when investing in the other country;
- prohibition of performance requirements; and
- amendments to reflect changes to legislation in Australia (the Copyright Amendment Act 2006) and Singapore resulting from each country’s bilateral FTA with the United States.
View the full, amended agreement here.
WTO: World Trade Report 2011
The most recent World Trade Report from the World Trade Organization looks at the ever-expanding, global network of preferential trade agreements (PTAs). The paper finds that these agreements often go beyond "shallow" tariff-reduction to facilitate deeper economic integration through coverage of non-tariff regulatory issues that lie "behind the border".
World Trade Report 2011, The WTO and preferential trade agreements: From co-existence to coherence.
Other news
- THE THIRD MEETING OF THE AANZFTA FTA JOINT COMMITTEE - 30 May - 3 June 2011, Wellington, New Zealand [PDF]
- Media release: Australia and India launch free trade negotiations. 12 May 2011
- Media release: Australia welcomes Indian decision on a Free Trade Agreement. 1 May 2011
- Media release: Trade Minister visits Indonesia. 17 April 2011
- Media release: Gillard Government reforms Australia's trade policy. 12 April 2011
- Media release: Productivity Commission report on bilateral and regional trade agreements
- Speech: The future of trade policy in an uncertain world” – Speech to Lowy Institute
- Update: Fourth round of Trans-Pacific Partnership Agreement (TPP) Negotiations
- THE SECOND MEETING OF THE AANZFTA FTA JOINT COMMITTEE - 24-25 November 2010, Melbourne, Australia [PDF]
- Media release: Emerson welcomes fresh start on Japan-Australia trade negotiations
- Joint announcement on the commencement of negotiations on an Indonesia-Australia Economic Partnership
- Trade Minister welcomes launch of Australia-Indonesia negotiations
- Australia-Malaysia Free Trade Agreement Negotiations continue
- November 2010 update on the Pacific Agreement on Closer Economic Relations (PACER) Plus negotiations
- Third Round of Trans-Pacific Partnership (TPP) Negotiations – Malaysia joins
Frequently asked questions
What is a free trade agreement?
A Free Trade Agreement (FTA) is an international treaty which removes barriers to trade and facilitates stronger trade and commercial ties, and increased economic integration between participating countries.
FTAs open up opportunities for Australian exporters and investors to expand their business into key overseas markets. FTAs can improve market access across all areas of trade — goods, services and investment — and help to maintain and stimulate the competitiveness of Australian firms both internationally and domestically. This also benefits Australian consumers through access to an increased range of better value goods and services.
As a member of the World Trade Organization (WTO), Australia is required to meet certain legal disciplines in relation to FTA design. The Australian government considers these as positive standards which provide useful guidance to all potential FTA participants. Under WTO rules FTAs must:
- eliminate tariffs and other restrictions on 'substantially all the trade' in goods between its member countries, and
- eliminate substantially all discrimination against service suppliers from member countries (helping to increase trade in services).
An aspect of Australia’s FTA negotiations which is becoming more of a focus are the so-called 'behind the border' issues. A range of factors such as standards, professional qualifications, intellectual property rights and competition policies in trading partner countries may impact heavily on Australian companies exporting to those markets. Such barriers are often more of a problem for businesses than ‘border measures’ such as tariffs and quota restrictions which have been the focus of trade negotiations traditionally but which have become relatively less important over time as their average level has fallen.
How many free trade agreements does Australia have?
Australia has six FTAs currently in force (covering 29 percent of Australia's trade) and nine more (for a further 36 per cent of Australia's trade) under negotiation.
What guides Australia's FTA policy?
The Government’s FTA policy aims primarily at maximising the economic benefits flowing to Australia from the negotiation of these agreements. The Gillard Government Trade Policy Statement provides a framework for all trade negotiations, including FTAs. This incorporates principles, disciplines and objectives which provide explicit guidance to negotiators and policy-makers. The Trade Policy Statement makes clear that Australia’s FTAs must, for example:
- pass a net benefit test; and demonstrably be in the national interest;
- be comprehensive, high-quality, truly liberalising trade deals which eliminate or substantially reduce barriers to trade;
- support global trade liberalisation, and;
- be negotiated in a way that keeps the public well informed and that provides opportunities for public input.
The Gillard Government’s Trade Policy Statement makes clear that the right of Australian governments to make laws in relation to public policy will be preserved. Our FTAs contain the same general exceptions as in the core WTO agreements, so that Australian governments are able to take reasonable trade restrictions if this is required to:
- enact strict quarantine measures;
- protect human health;
- preserve the environment;
- set food safety standards to reflect community values, and;
- defend our security interests.
What are the benefits of free trade agreements?
- FTAs foster freer trade flows and create stronger ties with our trading partners;
- FTAs don't just eliminate tariffs, they also address behind-the-border barriers that impede the flow of goods and services between parties, help to encourage investment, enhance cooperation, and address other issues, such as intellectual property, e-commerce and government procurement;
- FTAs increase Australia's productivity and contribute to higher GDP growth by allowing domestic businesses access to cheaper inputs, introducing new technologies, and fostering competition and innovation;
- FTAs promote regional economic integration and build shared approaches to trade and investment, including through the adoption of common Rules of Origin and through broader acceptance of product standards;
- FTAs can deliver enhanced trading opportunities that contribute to the sustainable economic growth of less-developed economies.
How can I take advantage of Australia's free trade agreements?
Australian businesses can take advantage of FTAs — find out more from the Australian Trade Commission, Austrade.