Britain open to Aussie-style EU trade deal but Australia wants more

[snoop1130]

Britain open to Aussie-style EU trade deal but Australia wants more

By Byron Kaye, Swati Pandey

 

FILE PHOTO: Britain's Prime Minister Boris Johnson arrives to attend a news conference at the European Union leaders summit dominated by Brexit, in Brussels, Belgium October 17, 2019. REUTERS/Toby Melville/File Photo

 

SYDNEY (Reuters) - As Britain’s negotiations with the European Union on a post-Brexit trade deal go down to the wire, Prime Minister Boris Johnson says his country could trade with the bloc on similar terms to Australia, if no agreement is reached.

 

But Australia itself is far from happy with its arrangements with the EU and is pushing for the better market access that only a fully-fledged trade deal with the wealthy 27-member bloc and its 500 million potential customers would bring.

 

Now, the bulk of Australia’s 15 billion euros ($18 billion)exports to the EU are subject to tariffs and quotas set under basic World Trade Organisation (WTO) terms.

 

That’s why Australian exporters are backing Canberra’s moves to strike a new free trade agreement (FTA) with Brussels so they can get the certainty they need to invest and plan.

 

“If they’re emulating our current access to Europe, it is a fairly fractured and limited access, so it’s an interesting one they’d like to copy,” Andrew McDonald, director of NH Foods Australia, a Japanese-owned beef producer based in Sydney with three processing facilities in eastern Australia, told Reuters.

 

Britain’s aspirations for its future trading relationship with the EU have been gradually whittled down as disagreements between the two have emerged in often prickly negotiations following Britain’s exit from the EU on Jan. 31.

 

Attempts by former Prime Minister Theresa May in 2017 to secure a “bespoke” deal with the EU were given short shrift in Brussels. Her successor Johnson acknowledges any deal would have to be based on precedents and has cited the EU’s tariff-cutting 2014 agreement with Canada as a possible model.

 

As talks stalled this year, Johnson said Britain could also live with an Australian-style arrangement. Given that Australia does not have a free-trade agreement with the EU, domestic critics say the phrase is simply a euphemism for a no-deal.

 

On Sept. 7, Johnson repeated the view that an Australian-style EU deal would be a “good outcome” for Britain and this has become the government line.

 

“A negotiated outcome remains our clear preference. However, whether we trade with the EU on terms similar to Canada or Australia, we will be reclaiming our independence as a sovereign nation at the end of the transition period, which is what the British people voted for,” a government spokesman said.

 

“An Australia-style deal would give us full control over our laws, our rules and our fishing waters, as well as the freedom to strike free trade agreements with other countries around the world.”

 

BEEF SQUEEZED

 

In Australia’s case, the lack of an EU trade deal means falling back on WTO terms that impose a variety of restrictions.

 

Its farmers, for example, can export meat to the EU at reduced tariffs with two tranches, one for “high quality” and one for “grain-fed” beef.

 

The former is a fixed quantity with a 20% tariff and the latter is tariff-free, but it is shared with other countries on a first-come first-served basis.

 

What’s more, Australia’s share of the grain-fed quota is set to be squeezed as the EU has yielded to U.S. demands that its farmers take 35,000 of the 45,000-tonne allotment.

 

McDonald said the quotas have restricted the amount of beef his company can sell to Europe, which in turn has forced him to cut his exposure to the EU market.

 

“You can’t go through all the processes and the six, seven months of lead time in terms of preparing product to face significant losses on it,” he said.

 

It was concerns like those that prompted Australia to launch negotiations with the EU in 2018 to try to secure what it called an “ambitious and comprehensive” free trade deal.

 

Canberra wants to get rid of all EU tariffs on industrial goods, which currently include a 12% duty on minerals and metals, 10% on wood and paper, and 7% on chemicals.

 

It is seeking to do the same for agricultural exports such as beef, sheep meat, sugar, cheese and rice, which Canberra says are significantly constrained by EU quotas. It recognises, however, that negotiations will be difficult for farm produce.

 

PARMA HAM AND FETA

 

Australia’s foreign and trade ministry cites other advantages of a deal such as less red tape and alignment with EU’s high standards on sustainable development.

 

The stakes for Australia in securing favourable terms with the EU are arguably lower than they are for Britain.

 

The 27 members that now make up the EU accounted for 672 billion sterling ($870 billion) in two-way trade with Britain last year, making the bloc by far its largest trading partner.

 

China meanwhile accounts for over a third of Australia’s total exports and the EU only accounted for $61 billion of two-trade with Australia.

 

Yet Canberra sees big potential in an EU FTA.

 

“There are massive opportunities to better align Australian and European regulatory systems that enables business to flow,” said Jason Collins, chief executive of the European-Australian Business Council trade forum.

 

To be sure, some Australian companies are less than enthused about the benefits of an FTA with the EU as they worry it could have knock-on effects on their domestic businesses.

 

Australia says Brussels has listed more than 400 food and drink items, such as Feta cheese and Prosciutto di Parma ham, that can only carry those names in both Europe and Australia if they are made by EU producers.

 

“Our biggest issue is as part of the deal, the EU is trying to prohibit the use of some product names within Australia,” said Sheree Sullivan, CEO and part-owner of Adelaide Hills-based cheese producer Udder Delights in South Australia.

 

“Some of them are unknown and not used in Australia, but some are - and it will affect small goods, meat cuts, cheese and maybe a few other lines,” she said.

 

-- © Copyright Reuters 2020-10-05

 

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[Mavideol]

10 minutes ago, snoop1130 said:

“An Australia-style deal would give us full control over our laws, our rules and our fishing waters, as well as the freedom to strike free trade agreements with other countries around the world.”

wish for what you want BJ but have bad news for you.... EU will have the final word and you will not like it, stop the mongering, pack and leave.... you will not be missed, on your way out, please, make sure the door will not hit on the rear  555

[RayC]

2 hours ago, Mavideol said:

wish for what you want BJ but have bad news for you.... EU will have the final word and you will not like it,

By definition, neither side can strike a unilateral deal, so neither side will have the 'final word'. 

2 hours ago, Mavideol said:

 

stop the mongering, pack and leave.... you will not be missed, on your way out, please, make sure the door will not hit on the rear  555

From a trade perspective, Brexit was bad news for both sides. Likewise, 'no deal' will be bad for both sides, although imo the UK will suffer more'.

 

So far as broader EU issues are concerned, the UK views were usually aligned with the Netherlands and the Scandinavian countries, so I guess that those countries will miss the UK.

[RayC]

So rather than 'No deal', we now have to call it an 'Aussie style deal'? Excellent news. Business breathes a sigh of relief. That's made all the difference.

[Surelynot]

10 minutes ago, RayC said:

So rather than 'No deal', we now have to call it an 'Aussie style deal'? Excellent news. Business breathes a sigh of relief. That's made all the difference.

Sad thing is that will fly with the UK electorate...or English electorate rather 

[mfd101]

Yes, the English electorate getting what they voted for, and at a price way beyond what they ever dreamed or anyone ever told them about in words they could understand.

[JonnyF]

20 hours ago, snoop1130 said:

“If they’re emulating our current access to Europe, it is a fairly fractured and limited access, so it’s an interesting one they’d like to copy,” Andrew McDonald, director of NH Foods Australia, a Japanese-owned beef producer based in Sydney with three processing facilities in eastern Australia, told Reuters.

Maybe Mr. McDonald would be happy to hand over Australian fishing waters to the EU, and let Australia be answerable to the EU on state aid and answerable to the European Court of Justice in any disputes with the EU. Maybe he'd like Australia to be tied to the EU's extremely slanted level playing field as well?

 

What's that Mr. McDonald? You'd never agree for Australia as a sovereign country to accept such ridiculous demands from the corrupt EU bully boys? No, neither will the UK.

[welovesundaysatspace]

33 minutes ago, JonnyF said:

Maybe Mr. McDonald would be happy to hand over Australian fishing waters to the EU, and let Australia be answerable to the EU on state aid and answerable to the European Court of Justice in any disputes with the EU. Maybe he'd like Australia to be tied to the EU's extremely slanted level playing field as well?

 

What's that Mr. McDonald? You'd never agree for Australia as a sovereign country to accept such ridiculous demands from the corrupt EU bully boys? No, neither will the UK.

So you’ll lose either way, economically or ideologically. That’s the beauty of Brexit. I love it. Thanks 52ers. 

[JonnyF]

6 minutes ago, welovesundaysatspace said:

So you’ll lose either way, economically or ideologically. That’s the beauty of Brexit. I love it. Thanks 52ers. 

Incorrect. The EU will give us a trade deal eventually, we just have to let them dry their tears and grow up. Like a teenage girl that's been dumped by her boyfriend, they'll get over the rejection. Maybe 3-4 years should do the trick. After all, if the EU were a reasonable organization then Brexit would never have happened.

 

In the meantime we'll continue making trade deals with the rest of the world. You know, those grown up countries that are capable of making sensible deals that benefit both sides.

 

Keep whining though, it's very entertaining for us 52ers dancing in those salty 48er tears ????

[Moo 2]

Four years the UK betrayed the EU by breaching their contract. The EU has more important things

to do than to listen to Boris the clown and his lies. Dear UK just get out and stop blaming anyone else. Scotland is getting impatient to join the EU.

 

        "Soldiers, never interrupt an enemy who is about to make a mistake"  Napoleon  

 

[vogie]

Good grief, the Euros and remainers on here are talking like a load of immature girlies in the playground about a student who has far excelled them at her exams and has finished up with top marks. The mature student will go on to make something of her life whilst the bitter and twisted mob will still go on calling her names like 'she must have cheated, why couldn't she be like us and be a bunch of losers and who have nothing better to do than to name call.'

[puipuitom]

Typical British negotiations: "we want ( = insist) a deal like Canada ( still not ratified by all EU member states) or Australian ( does not exist yet, in negotiation) , and even the Aussies want a LOT better deal as the present forecast) ".

Yet less than 3 months and the British will face a NO DEAL: Schengen visa, international drivers licence and insurances, and WTO "third party" import duties https://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en, even with no special tariffs for certain goods as the Australians have ( in competition with other origins).

 

And for a lot it products, especially fresh foods, the British need the EU, whatever happens.

[ballpoint]

From oven ready deal to barbie ready deal?  Crikey.

[Mavideol]

20 hours ago, RayC said:

so I guess that those countries will miss the UK.

just a thought that you (may) could be wrong/incorrect.... I don't think anybody will miss the UK 555

[RayC]

57 minutes ago, Mavideol said:

just a thought that you (may) could be wrong/incorrect.... I don't think anybody will miss the UK 555

(Differing) Opinion from each of us.  I may be wrong, unless I'm right; in which case, you will be wrong????. Time will tell...

[welovesundaysatspace]

20 hours ago, JonnyF said:

The EU will give us a trade deal eventually

Sure, why not. A bare minimum trade deals on our terms. ???? 

 

20 hours ago, JonnyF said:

 

In the meantime we'll continue making trade deals with the rest of the world. You know, those grown up countries that are capable of making sensible deals that benefit both sides.

Yes, please continue making trade deals like the one with Japan, which gives that “grown up country” a say over you state aid while reaping 80% of the benefits of the deal whereas your economy is expected to get a boost of just 0.x% as compared to the EU-JP FTA. Or has the been any other trade deal recently? ???? 

[JonnyF]

18 hours ago, puipuitom said:

Typical British negotiations: "we want ( = insist) a deal like Canada ( still not ratified by all EU member states) or Australian ( does not exist yet, in negotiation) , and even the Aussies want a LOT better deal as the present forecast) ".

Yet less than 3 months and the British will face a NO DEAL: Schengen visa, international drivers licence and insurances, and WTO "third party" import duties https://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en, even with no special tariffs for certain goods as the Australians have ( in competition with other origins).

 

And for a lot it products, especially fresh foods, the British need the EU, whatever happens.

Yes, it's impossible to buy fresh food without a trade deal isn't it... Laughable. At the worst there will be some tariffs on EU foodstuffs which we will collect back on goods going the other way since they EU has a massive trade surplus with the UK.

 

More likely however, is that we'll buy elsewhere and the EU will lose the sale.

[JonnyF]

24 minutes ago, welovesundaysatspace said:

Sure, why not. A bare minimum trade deals on our terms. ???? 

 

Yes, please continue making trade deals like the one with Japan, which gives that “grown up country” a say over you state aid while reaping 80% of the benefits of the deal whereas your economy is expected to get a boost of just 0.x% as compared to the EU-JP FTA. Or has the been any other trade deal recently? ???? 

Sure, if the EU wants tariffs on the huge volume of exports they send to the UK then a bare minimum deal should suit them. Until British consumers start buying cheaper alternatives from outside the EU of course.

 

Trade deals can take a while to sort out. The EU has been working on some for decades, but then they are a sloth like, unreasonable, divided, difficult organization to deal with. UK deals will be much faster, once we're fully out. We've already done over 20 (including Japan and South Korea) and we haven't even left yet. 

 

By the way, the EU does over a Billion Euros of trade a day with China with no deal. Amazing huh. Makes you realize how over-rated FTA's are (unless you're trying to use the false promise of one to blackmail a third party).

[Bruntoid]

22 hours ago, JonnyF said:

 

In the meantime we'll continue making trade deals with the rest of the world. You know, those grown up countries that are capable of making sensible deals that benefit both sides.

<chuckle>
 

and 4 years in how’s that going ? 
 

You’ve naffed off THE biggest trading bloc on the planet and the second biggest have stated break international law and you can forget ours too ! 
 

It’s a pickle 
 

 

Edited October 7, 2020 by Bruntoid

[Bruntoid]

21 hours ago, vogie said:

Good grief, the Euros and remainers on here are talking like a load of immature girlies in the playground about a student who has far excelled them at her exams and has finished up with top marks. The mature student will go on to make something of her life whilst the bitter and twisted mob will still go on calling her names like 'she must have cheated, why couldn't she be like us and be a bunch of losers and who have nothing better to do than to name call.'

You ok ? 

[Bruntoid]

So Boris is after a deal which emulates a country that isn’t happy with it !! 
 

haha come on when is this clown going to give it up! 

[vogie]

39 minutes ago, Bruntoid said:

You ok ? 

Spiffing thanks, the leavers have got past the golf club analogies, we have moved on, time for the remainers to do the same.????