Australia signs historic free trade agreement with the UK

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Australia signs historic $19billion free trade deal with the UK which allows young Aussies to work in Britain for three years and provides a huge boost to farmers

  • Australia has an historic signed free trade agreement with the United Kingdom 
  • The deal allows Aussies under 35 to live and work in the UK for three years 
  • It also provides a huge boost for farmers with tariffs cut on wine and meat 

By Charlie Moore, Political Reporter For Daily Mail Australia

Published: | Updated:


Australia has signed an historic free trade agreement with the UK which allows young Aussies to live and work in Britain for three years. 

Trade Minister Dan Tehan signed the deal in a virtual ceremony in Adelaide with UK Trade Secretary Anne-Marie Trevelyan on Friday morning.

In a huge win for Aussie farmers, the deal will liberalise Australian imports of beef, lamb, cheese wine and sugar into the UK, which became free to set its own trade policy after the Brexit process ended in January. 

The agreement was thrashed out by Scott Morrison and Boris Johnson over a three-hour dinner in Number 10 Downing Street in June. Pictured: The two prime ministers celebrated by exchanging hampers of British and Australian goods in Mr Johnson’s garden

In return, Aussies will get cheaper British cars, whisky, confectionery, biscuits and cosmetics as the deal abolishes taxes on 99 per cent of Australian exports worth $9.2billion and UK imports worth $200million.

UK officials say the deal will unlock $19billion (£10.4billion) of additional trade. 

Britons under 35 will be allowed to live and work in Australia for three years without having to do farm work and Aussies will have the same working rights in the UK.

Previously they could only stay for two years.    

The agreement was thrashed out by Scott Morrison and Boris Johnson over a three-hour dinner in Number 10 Downing Street in June where the friends feasted on Scottish salmon and Welsh lamb, washed down with Australian wine. 

Tariffs on beef and lamb, which are as high as 80 per cent, will be removed after 10 years unless there is a surge in exports in which case they will remain for a further five years. 

The tariff-free quota of beef will rise from 35,000 tonnes to 110,000 tonnes and the quota for lamb will increase from 25,000 tonnes to 75,000 tonnes.

Former UK Trade Secretary Liz Truss, now Foreign Secretary, with Australian Trade Minister Dan Tehan earlier this year

Former UK Trade Secretary Liz Truss, now Foreign Secretary, with Australian Trade Minister Dan Tehan earlier this year

Rice tariffs will be eliminated straight away, dairy tariffs brought down over five years and sugar tariffs also phased out gradually. 

The deal will also eliminate UK tariffs on Australian wine, swimwear and confectionery such as Tim Tams. Australia’s five per cent tariff on UK imports will also be scrapped.   

Trade Minster Dan Tehan said this is Australia’s most comprehensive and ambitious deal, apart from the one with New Zealand.

‘It will strengthen the deep connection between our peoples, with Australians now having similar access to Britain as European nationals, and British nationals having access to Australia similar to our best free trade agreements,’ he wrote in an opinion piece published in The Australian on Friday.

‘The Australia-UK FTA is an example to the world that embracing free trade is the best way out of the pandemic.’

There were five rounds of negotiations between delegates over the course of a year before the in-principle agreement was reached in June.

The UK is Australia’s eighth largest two-way trading partner worth almost $27 billion in 2018.

It is also Australia’s third-largest services trading partner, with Australian service exports valued at $5.5 billion and imports totalling $9.2 billion in the same year.

What does the deal with the UK do? 

The Government has cited the following benefits: 

• Exporters will benefit from immediate elimination of tariffs on over 99 per cent of Australian goods exports to the UK, valued at around $9.2 billion, when the agreement enters into force.

• Farmers will have improved access to more than 65 million UK consumers who value safe, sustainably produced foods and beverages with the strong provenance Australia offers.

  • Around $43 million in annual customs duties will be removed from Australian wine when the agreement enters into force.
  • For beef, a tariff-free quota of 35,000 tonnes at entry into force will expand to 110,000 tonnes in year 10. Tariffs on beef will be eliminated after ten years.
  • For sheep meat, a tariff-free quota of 25,000 tonnes at entry into force will expand to 75,000 in year 10. Tariffs on sheep meat will be eliminated after ten years.
  • For sugar, a tariff-free quota of 80,000 tonnes at entry into force will expand to 220,000 tonnes in year 8. Sugar tariffs will be eliminated after eight years.

• Professionals will have the same access to the UK’s lucrative jobs market as their European competitors, except from the Republic of Ireland. This means Australian job seekers can compete on an equal footing with EU nationals in the UK for the first time in more than 40 years.

• Australian households and businesses will save around $200 million a year as tariffs on British imports into Australia, such as cars, whisky, confectionery, biscuits and cosmetics, are phased out within five years, with tariffs on almost all UK goods being eliminated on entry into force.

• Young people will have more time to travel to the UK for a working holiday and will be able to stay longer, with eligibility to participate in working holiday opportunities raised from 30 to 35 years of age, and stays allowed for up to three years in each country.

• Australian businesses will have the guaranteed right to bid for a greater variety of UK government contracts in a procurement market worth an estimated half-a-trillion dollars annually.

• UK businesses will be encouraged to invest in Australia thanks to best practice investment rules, including to set up regional headquarters in Australia to leverage our network of free trade agreements.