The UK’s newly inked free trade deal with Australia, the first to be developed from scratch since EU Exit, is expected to create new opportunities for a range of manufacturing industries.
The trade agreement has now been finalised and signed by both parties, having initially been agreed in principle back in June 2021.
The deal is expected to unlock £10.4 billion of additional trade between the two nations by eliminating tariffs on 100 per cent of UK exports. It also gives UK firms ‘guaranteed access’ to bid for Australian public sector contracts and relaxes visa conditions for young people and visiting installers and servicers of machinery.
In the longer-run, the agreement brings the government closer to its goal of joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a larger free trade area compromising 11 Pacific nations from Australia to Mexico.
The manufacturing industries expected to benefit most from new export opportunities include the food and drink, automotive, machinery, chemical, renewable energy and medical device sectors. However, parts of the food and drink industry have also voiced concerns about the future potential for UK producers to be undercut by Australian competitors, who are subject to lower environmental and welfare standards.
Commenting on the trade deal, Stephen Phipson, CEO of Make UK, said:
“Achieving a new preferential trade arrangement with Australia is welcome for Britain’s manufacturers who will benefit from day one with tariff free access on goods sold and witness improvements in business mobility between the two countries.
“With enhanced export opportunities for the UK’s medical device manufacturing sector and strengthened frameworks for bilateral co-operation on technical standards and regulations, there is much that the UK and Australia can work on in the future to boost exports from the UK.
“In the coming months, we look forward to working with government to look at how the wider benefits of this new and closer relationship can be positioned and communicated with the manufacturing sector to maximise understanding of the opportunities available ahead of the deal coming into force in the future.”
According to recent research, almost a quarter of British exporters forecast significant growth opportunities in Australia and New Zealand.