AFGC Welcomes Trade Breakthrough

The Australian Food and Grocery Council (AFGC) today welcomed the announcement by Trade Minister, the Hon Andrew Robb MP that agreement has been reached on the Trans Pacific Partnership (TPP) trade deal.

AFGC CEO Gary Dawson said the TPP agreement, covering 12 nations that together constitute 40% of the global economy, would bring significant benefits for Australia’s food and grocery sector.

“This regional trade agreement will further open up some of Australia’s key export markets, particularly in the food, beverage and grocery sectors. The TPP builds on earlier trade agreements including with the United States, Japan, Malaysia and Singapore”, said Mr Dawson.

“The TPP sets a global standard for trade liberalisation going forward.  The TPP provides a common set of rules among 12 countries which will greatly support Australian food exporters’ participation in regional and global supply chains.”

TPP outcomes include:

  • the elimination of 98 per cent of tariffs on Australia’s exports, including Australia’s food, beverage and grocery exports;
  • further reduction of tariffs on Australian exports of beef to Japan to 9 per cent; tariffs on beef into Mexico and Canada will be eliminated within 10 years, and the AUSFTA beef safeguard into the US will be eliminated;
  • an additional 65,000 tonnes of sugar to USA; further levy reduction for high polarity sugar into Japan; elimination of the tariff on refined sugar into Canada; elimination of tariffs on raw sugar into Peru; and for the first time wholesale licencing arrangements for supply of refined sugar to the food and beverage industries in Malaysia will be liberalised;
  • arrangements to export more rice to Japan and agreement on new administrative arrangements to facilitate trade;
  • tariffs will be eliminated on a range of cheese exports to Japan covering over $100 million in existing trade, with new preferential access for a further estimated $100 million of trade; new quota access for Australia on butter and skim milk powder; additional 9,000 tonnes of cheese to the USA, as well as tariff elimination on milk powders and Swiss cheese;
  • tariff elimination on wheat and barley exports into Mexico (within 10 years) and Canada (upon entry into force); reductions of the fees applied to wheat and barley in Japan and the creation of new quota arrangements;

“The TPP will encourage investment between parties by raising the foreign investment review board screening threshold to $1,094 billion for non-sensitive sectors. Food manufacturing in Australia requires greater access to foreign investment to provide the capital needed to expand and meet the demand from TPP partners, and we would encourage the Australian Government to consider these investment requirements in their regulatory policy making”.

“The commercial benefits to business and opportunities for consumers are the immediate benefit of the Trans Pacific Partnership. The TPP will be the most significant trade agreement concluded in the last 20 years once it enters into force,” Gary Dawson said.


AFGC Media Contact: James Mathews 0407 416 002