An historic free trade agreement (FTA) between Australia and the United Kingdom will strengthen the UK’s investment in Australian commodities, while providing easier access for mining businesses to trade equipment and services.
Facilitating a strong trading relationship between the nations was key to both parties, as the UK was Australia’s second largest source of foreign investment in 2020.
The most valuable exports from Australia to the UK in 2019-20 were gold ($12.7 billion), lead ($468 million) and coal ($214 million).
The United Kingdom’s total interest in Australia was more than $778 billion in the 2019-20 financial year.
Minerals Council of Australia (MCA) chief executive officer Tania Constable said the agreement would enhance the Australian mining equipment, technology and services (METS) sector.
“Modern investment rules under the AU-UK FTA will encourage further investment between both countries, while clear dispute settlement processes and commitments to enhance digital trade and address non-tariff barriers will be good for METS businesses,” Constable said.
“Australia’s minerals industry and the UK’s industrial sector already have strong partnerships based on a highly developed two-way trade and investment relationship.”
According to a statement from the UK Government, “90 per cent of all exports from Northern Ireland to Australia are machinery and manufacturing goods – used extensively in Australia’s mining, quarrying and recycling sectors”.
“Under the new FTA, tariffs will be removed and customs procedures will be simplified,” the statement added.
Regional trade and investment director AU/NZ for Invest Northern Ireland, Peter Hendrikssen, said the removal of tariffs would have a positive effect on the industries of both nations.
“Materials handling equipment from Northern Ireland is already highly regarded within Australia’s mining sector for its quality and durability,” Hendrikssen said.
“Tariff-free access to the Australian market for materials handling equipment from Northern Ireland would undoubtedly further enhance the competitive positioning of our exporters to this market.”
Australia’s Department of Foreign Affairs and Trade (DFAT) outlined its objectives going into the agreement.
One objective aimed to encourage small and medium-sized businesses to the table in trading with the United Kingdom.
“Australia is seeking to agree on ambitious rules that assist small and medium-sized enterprises to take advantage of the benefits of this agreement,” the DFAT website stated.
Technologically, Australia has continued to play its part in funding and developing innovations for an efficient and sustainable future.
Constable said the FTA will allow for such innovations to be shared and developed more easily and in partnership.
“The ability to innovate, quickly adopt and adapt technologies keeps Australian mining efficient and internationally competitive,” Constable said.
“The AU-UK FTA’s digital trade and intellectual property provisions will boost innovation and drive further economic growth through technology-led productivity gains.”
The negotiations were launched on June 17 2020 and were agreed upon in-principle on June 15 2021, almost a year to the day.