Trade minister says new multi-lateral trade deal could insert Australian businesses into some of the world’s most lucrative supply chains
Federal Trade Minister Andrew Robb says the world’s largest-ever regional trade deal – the Trans-Pacific Partnership (TPP) – could soon be signed this year.
The agreement would allow both large and small Australian companies access to some of the world’s most lucrative supply chains.
The TPP will cover market access between Australia and 11 other countries in the Pacific region: Brunei, Chile, New Zealand, the United States, Singapore, Vietnam, Malaysia, Peru, Canada, Mexico, and Japan.
“For Australia, it means new levels of market access into markets where we don’t already have trade agreements, such as Canada, Mexico, and Peru,” Robb says, adding the partnership will also improve access to countries covered by bi-lateral agreements.
Importantly, the TPP will offer opportunities to contribute to the global value chains of some of the world’s best-known products and brands.
“It is now typical for components or partially finished items to move through multiple countries before their ultimate completion,” Robb says.
“In 1990, 20 per cent of goods and services globally ended up as intermediate contributions in other (higher value) goods and services. Today that figure is 70 per cent.”
Robb says the TPP could be finalised and signed as early as May.
Meanwhile, the Government’s export finance arm Efic, which reports to Robb, says the restructuring of China’s economy will bring a mix of opportunities for Australian exporters and logisticians.
The diminishing role of the commodity-intensive property and infrastructure sectors of the Chinese economy will continue to pressure Australia’s mining exports,” Efic senior economist Cassandra Winzenried says.
“But rising demand from a rapidly expanding Chinese consuming class will provide some offset.”
She expects Australian exporter confidence to improve this year, in line with improvements to the global economy. That should provide further opportunity for freight and logistics enterprises in both markets.