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China-Australia FTA Signed

The official signing of the China-Australia Free Trade Agreement was held June 17 in Canberra. General terms of the agreement were unveiled November 17, when Australian Prime Minister Tony Abbott and Chinese President Xi Jinping announced the conclusion of negotiations that originally began in 2005. News reports suggest that the ratification process will require another four to five months to complete, but the agreement should enter into force by the end of this year.

China’s tariffs on Australian beef products, which currently range from 12 to 25 percent, will be eliminated over nine years. These terms are similar to the New Zealand-China FTA in which duties on chilled and frozen beef muscle cuts have been reduced to 2.7 percent, and will be eliminated next year. China’s tariffs on Australian livestock, currently at 10 percent, are to be eliminated over four years.

Tariffs on Australian lamb and sheep meat products, which are currently 12 to 23 percent, will be eliminated over eight years. This is also similar to the New Zealand-China FTA, under which duties on frozen bone-in lamb now stand at 2.7 percent and will be eliminated next year. Australian dairy products are being heralded as the biggest winner in the FTA, with tariffs as high as 20 percent being eliminated over a period ranging from four to 11 years.