Australia trade deal blow: UK facing dire £2.6bn trade swing – new report finds

Australia trade deal: Expert discusses impact on Scottish farming

When you subscribe we will use the information you provide to send you these newsletters. Sometimes they’ll include recommendations for other related newsletters or services we offer. Our Privacy Notice explains more about how we use your data, and your rights. You can unsubscribe at any time.

The UK and Australia are fine-tuning a post-Brexit agreement, with International Trade Secretary Liz Truss hoping a deal can be agreed in principle by next month. Britain is said to be in favour of opening up international markets and is thought to be keen to offer a zero tariff, zero quota approach to Australian exporters. Such terms have divided ministers and sent alarm bells ringing for UK farmers amid fears of being undercut.

Research published today by the Bow Group think-tank suggests a deal could move the balance of trade in the direction of Australia by between £168million (one percent) and £2.6billion (12.5 percent).

Based on Government scenarios, the report explained the value of trade to Australia could increase from £5.2billion to £9.5billion, compared to the UK rising from £10.7billion to £11.5billion.

In such a case, the balance of trade between the two nations would narrow from 32.7 percent to 67.3 percent in favour of the UK, to just 45.2 percent and 55.4 percent respectively.

The Bow Group points out this would be despite the UK economy being twice the size of Australia’s.

It adds: “On the basis of the proposed deal it is almost certain that the balance of trade shift will be in Australia’s favour, and therefore the deal disproportionately benefits Australia over the UK, particularly regarding agriculture/food sectors.”

The conservative think-tank remains a champion of Brexit and in favour of a trade deal with Australia, but insists it should be one which “evenly increases non-EU imports and exports”.

Bow Group chairman, Ben Harris-Quinney told Express.co.uk: “Like most trade deals there should be mutual benefit to both sides, but the mark of a good negotiation outcome is one that presents an even settlement, or one that favours the UK. This deal significantly favours Australia.

“Australia is a great friend and ally of the UK, and is exactly the sort of country we should be prioritising a trade deal with, but we want trade deals that present even benefit or an advantage for the UK.

“The UK economy is almost twice the size of Australia, therefore given our clout we should have been in a strong enough negotiation position to at least agree a deal that placed the balance of trade in our favour.

“Looking particularly at agriculture, UK farmers are seriously concerned, particularly over how the deal could negatively affect our domestic beef, lamb, and sugar production.

“Food imports from Australia to the UK could double in those sectors under the trade deal, which would have the effect of significantly undercutting domestic producers.”

Exports of beef, lamb and sugar from Australia to the UK could potentially double under the new arrangements.

Negotiations with Australia began last June and according to the Department for International trade, UK exports to Australia could increase by up to £900million,

UK businesses traded £18.1billion worth of goods and services with Australia in 2019

The Government forecast a UK-Australia trade deal could boost GDP by £500million.

DON’T MISS

Fishing SELL-OUT: New data exposes extent of Brexit stitch-up [INSIGHT]
Royal Family LIVE: Harry and Markle still ‘unhappy’ despite Megxit [LIVE]
UK hot weather forecast: Chart shows 24C heat bake Britain [FORECAST]

Earlier this afternoon, a Downing Street spokesman said Boris Johnson “wants to maximise the massive opportunities presented by post-Brexit trade deals”.

Number 10 insisted farmers would be protected in any deal with Australia.

A spokesman said: “Any agreement would include protections for our agriculture industry and won’t undercut UK farmers.”

Ms Truss has also made given reassurances to UK farmers and said a deal with Australia would also open the doors to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)– a trading bloc of 11 nations including Australia, New Zealand and Japan.

She told MPs: “I have had discussions with the National Farmers’ Union, I’ve been very clear with them that, of course, I’m always looking to make sure – as I have committed to – that British farmers will not be undercut by unfair practices from elsewhere.

“We will make sure in all the deals we do that British farming thrives and I’m absolutely confident that will be achieved through the Australia deal.

“The Australia deal is also the gateway to CPTPP, which has huge opportunities for British farming.

“We’re seeing 66 percent of the world’s middle classes are going to be in Asia by 2030, growing demand for products like beef and lamb, so both Australian access and CPTPP access, I think, is positive for British farming.”
Source: Read Full Article