Abstract
In the wake of the withdrawal of the United States from the Trans-Pacific Partnership (TPP) in early 2017, other countries in the region have accelerated their efforts to conclude trade agreements and form more effective coalitions against rising protectionism.
The two most important pathways are the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) process, which is based on an agreement among the remaining 11 members of the TPP and is likely to expand in the future, and the Regional Comprehensive Economic Partnership (RCEP) process among 16 Asian economies. Australia stands to enjoy real income gains on both of these pathways. However, since Australia is already benefiting from its own liberal trade policies and many prior trade agreements, as well as from other negotiations currently underway, its benefits are relatively modest, typically below one per cent of real income. The withdrawal of the United States from the TPP is projected to cut its gains from the CPTPP by about 25 per cent; nevertheless, the expansion of the CPTPP to 16 members would more than offset the adverse effects of the departure of the United States.
Deeper integration through regional agreements will generate additional trade and output gains in Australia's sectors of comparative advantage, including agriculture, mining, early stage processing activities related to these sectors and services. It also reduces slightly Australia's output of durable manufactured products, which in turn represent areas of comparative advantages for key Asian partners. Agriculture and mining would be among industries benefiting from deeper integration. New Asia-Pacific agreement or agreements would keep trade liberalisation on the global agenda and likely attract further cooperation from large partners, including Europe. Eventually, even the United States might find that it is losing out and change its mind about joining these larger trade blocs, with attendant benefits for Australia's economy – refer attached.
SMEs and the importance of LCBs and freight forwarders
On 30 July 2018, FTA participated in a hearing for the inquiry into small and medium enterprises (SMEs) accessing the benefits of free-trade agreements. The Australian Parliament's Joint Standing Committee on Foreign Affairs, Defence and Trade held this hearing in Melbourne providing FTA with an opportunity to promote the significant role played by licenced customs brokers and freight forwarders – for further detail please refer to the commentary from Travis Brooks-Garrett (Director FTA , Secretariat APSA) in the DCN on 30 August 2018 – refer HERE.
Paul Zalai – FTA / APSA |
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