Menu

Machinery flagged in controversial UK-Australia trade deal

The UK has announced agreement with Australia on a new trade deal, with details to follow.

A series of scene-setting highlights have been published on gov.uk, which says it is “the first major trade deal negotiated from scratch by the Government since we left the EU”.  Publication comes one year after the trade talks started,  on June 17th 2020.

Tariffs on all UK goods are eliminated, the government said.  Agricultural, mining and other machinery exports, as well as whisky, and cars made “in the midlands and north of England” are among those highlighted as benefiting.

Britons under the age of 35 will be able to travel and work in Australia more freely, the government says.

The digital trade provisions are the most advanced the UK has agreed so far.  “The ban on data localisation will allow our SMEs in particular to explore the market without the cost of having to set up servers,” trade body Tech UK says in the gov.uk release.

Prime minister Boris Johnson told Reuters:  “I think this is important economically, there’s no question about that … but I think it’s more important politically and symbolically.  We’re opening up to each other and this is the prelude to a general campaign of opening up around the world.”

Australia’s prime minister, Scott Morrison said it was the country’s most comprehensive and ambitious deal.  His trade minister, David Littleproud said it was “a great win for Australian agriculture”.

There are no details of the deal available and several industry groups said they would reserve judgement until they see the details.

But the announcement has prompted renewed criticism of the UK government or being secretive on trade.  Members of the confidential trade advisory groups, which exist to advise government, have said privately they have had little detail of the Australian deal.  Parliament will get no time to debate the deal until after the deal is done – in contrast to many other countries.  The Financial Times reports the government view that “MPs would be free to block a deal if they chose to,” but it is not clear how that would be done.

Chris Southworth, secretary-general of the International Chamber of Commerce in the UK, which supports the All-Party Parliamentary Group on Trade, said on Twitter:  “There is something fundamentally wrong when business, consumers, unions, civil society and parliamentarians can’t see what the government is signing us all up to nor allows proper scrutiny until after the deal is agreed.”  Hilary Benn MP, who chaired the now-defunct Commons Brexit committee, said that the deal risks setting a significant precedent for future deals with larger markets, Conservative Sir Roger Gale MP, said “we need to hold the government to account” and the National Farmers’ Union said the current system of scrutiny was “seriously under-powered” (all reported in the FT).

The Department for International Trade’s stated “priority outcomes” for trade are:

  • Securing world-class FTAs and reducing market access barriers;
  • Delivering economic growth to all the nations and regions of the UK through attracting and retaining inward investments;
  • Supporting British business in international trade and exporting; and
  • Championing the rules-based trading system and protecting British businesses from unfair trading practices.

Ministers have said that they will be setting out further detail on the plan for achieving these outcomes “in due course”.

Comment welcome for submission to EAMA – our representative group.