As 2015 started, market access issues and free trade agreements were high on the agenda for industry and government alike. The 1 January suspension of trade to Vietnam and negotiations in various Free Trade Agreements (FTAs) have dominated the conversation. OHMA has led industry engagement with government on multiple issues with an overarching goal of increasing Australia’s horticultural market access, and thereby export market options for Australian producers, in line with OHMA’s terms of reference.
On 1 January 2015, Vietnam stopped issuing import permits for fresh Australian fruit. The Vietnamese government sought information regarding Australia’s management of Mediterranean fruit fly, with the suspension having an immediate negative impact on several commodities, including table grapes, suspending trade as the season commenced.
Through the OHMA Committee, industry has made repeated representations to the Department of Agriculture to ensure the government took immediate steps to address this suspension. The Minister for Agriculture, the Hon. Barnaby Joyce met with the Vietnamese Ambassador to Australia, and Australia’s Ambassador to Vietnam met with Vietnam’s Minister for Agriculture to discuss the suspension.
Following a subsequent bilateral technical meeting in Hanoi on 11th February, Vietnam indicated that it was not seeking a permanent ban, and that its Pest Risk Analysis (PRA) for Medfly would likely be completed in May. Australia also indicated its progression of Vietnam’s own import requests, notably Lychee and Mangoes.
OHMA will continue to engage the Department on the suspension, and currently anticipates a resolution along the May time frame.
The Trans-Pacific Partnership is a pluri-lateral trade agreement covering 12 countries, including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. The deal aims to eliminate tariffs and address non-tariff barriers between the parties, in a market comprising nearly 800 million people, or 25% of global trade, of which over A$211 billion is currently with Australia.
Negotiations to conclude the TPP are well advanced, with a conclusion anticipated in the coming months. Indications are that Australia’s horticultural products will achieve almost complete tariff elimination, although some other sensitive agricultural products such as dairy, red meat and sugar face some obstacles, notably from Japan’s traditionally protected agricultural sector.
OHMA will remain in close touch with Australia’s negotiating team as the talks are finalised to ensure a successful outcome for horticulture.
Australia-India Comprehensive Economic Cooperation Agreement
Australia’s trade agreement negotiations with India began in 2011, and have seen comparatively slow progress, having completed five rounds, the last of which was in May 2013. The recent visit by Indian Prime Minister Narendra Modi to Australia as part of the G20 summit gave a significant boost to momentum, with the Prime Ministers of both countries committing to concluding the negotiations at an early juncture. Combined with the recent conclusion of the China, Japan and Korean FTA’s, along with the anticipated conclusion of TPP negotiations, a focus on completing the Indian FTA is expected.
Few agricultural commodities have yet engaged substantively in the negotiations, creating an opportunity for the horticultural industry to press its priorities, including the elimination of high tariff rates, often upwards of 30%, on entry into force of the agreement.
Once completed, this trade agreement will be India’s first with an advanced, diversified economy, potentially giving Australia’s horticultural exporters a significant advantage over their international competitors.
OHMA intends to prepare a submission to the Department of Foreign Affairs and Trade outlining the horticultural sector’s priorities for the Australia-India agreement in the coming weeks. Combined with regular and proactive engagement throughout the remainder of the negotiations, OHMA hopes to ensure a comprehensive and commercially valuable outcome for all of Australia’s horticultural producers.