Trade and Investment Minister Andrew Robb has announced that Australia’s Free Trade Agreement with South Korea will enter into force on 12 December 2014.
The announcement follows a vote overnight by the Korean National Assembly in support of the Korea-Australia Free Trade Agreement (KAFTA), and an ‘exchange of notes’ today between Australia’s Ambassador in Seoul and the Korean Government, agreeing to the date for entry into force.
Mr Robb said seeing KAFTA enter into force before the end of the year was an important objective of the Abbott Government.
“KAFTA’s entry into force at this time will mean that many Australian exporters will benefit from an immediate tariff cut by Korea, and a further tariff cut on 1 January 2015; shoring up our competitiveness in our third largest export market,” Mr Robb said.
KAFTA is one of three landmark trade agreements concluded by the Abbott Government since taking office, with Japan and China FTAs completing the trifecta.
Under KAFTA, tariffs will be eliminated on 84 per cent of Korea’s imports (by value) from Australia immediately on 12 December. On full implementation of the Agreement, 99.8 per cent of Australian goods exports will enter Korea duty free.
“KAFTA is expected to result in an annual boost to the economy of close to $650 million when fully implemented. It’s also projected to create many thousands of jobs over the next decade, helping to underwrite our prosperity for years to come,” Mr Robb said.
Given Korea is Australia’s fourth-largest trading partner – with bilateral trade worth more than $34 billion in 2013-14 – Mr Robb said KAFTA will increase export opportunities across a wide range of industries: from beef, wheat, sugar, dairy, wine, horticulture and seafood, to automotive suppliers, and the resources and energy industries. It will also open up significant opportunities for service providers.
“I urge Australian businesses to take full advantage of this Agreement,” Mr Robb said.
A guide for exporting and importing goods under KAFTA, including customs procedures, and step-by-step advice for business ahead of entry into force, can be found here.
KAFTA was signed in Seoul in April by Mr Robb and his Korean counterpart, Minister for Trade, Industry and Energy Yoon Sang-jik.
Mr Robb said the agreements concluded by the Abbott Government with Korea, Japan and China, send a strong signal that Australia is indeed open for business.
“Together these transformational agreements account for 62 per cent of our goods exports and 19 per cent of our services trade,” Mr Robb said.
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