The Australia United Kingdom Free Trade Agreement (A-UKFTA), the first full trade deal since the UK left the EU, went into force May 31. The deal removes tariffs on 99% of Australia product exports to the UK. Australian importers will also benefit from duty-free rates on almost all goods.
The elimination of tariffs, as well as simplified customs processes, will make it easier and less expensive for all sectors of the UK economy to import goods from Australia, according to Matt Croser, Dimerco’s Acting Country Manager in the UK. “This deal is a significant development for UK commerce in the Indo-Pacific,” he says.
Businesses in every area and country of the UK benefit from the Australia UK Free Trade Agreement, including the following:
- Infrastructure: UK businesses are now legally permitted to compete for $10 billion+ USD in annual Australian government contracts. For people working in the UK transport sector, this covers rail, roads, and goods.
- Food and drink: As of today, all tariffs on products like whisky, gin, and wine have been eliminated, making it far more appealing to transport alcohol-related goods – one of the top traded commodities between the two countries.
- Automobiles: Since Australia stopped making cars domestically, all cars sold there are imports. Opportunities in the UK will only grow as a result of the Australia UK Free Trade Agreement, especially for makers of premium cars with international appeal.
- Manufacturing and renewables: Thanks to this agreement, the UK’s numerous manufacturing and technology companies may now export their cutting-edge automation, renewable energy, and technology goods to a brand-new market. Businesses that stand to gain the most from the removal of the 5% tax include those who make wind turbine blades and wind generators.
Australia is a big proponent of the United Kingdom joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) , which would provide British investors and exporters access to 11 countries with a combined GDP of around $9 trillion USD.
By 2050, Australia’s economy is anticipated to rank in the top 10 in the world. Given that two thirds of the world’s middle-class customers will reside in Asia by 2030, early access to trade prospects in this region is key. And it will also help to have a global transportation and logistics partner, like Dimerco, that specializes in managing freight to and from the Asia-Pac region.
More Trade Means More Global Transportation
Dimerco has direct offices in both the UK and Australia and is already working with customers to increase activity on this shipping lane. To learn more, contact Dimerco or reach out to our UK or Australia offices.