Australia-Korea FTA Update

//Australia-Korea FTA Update

Australia-Korea FTA Update

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An Australia-Korea Free Trade Agreement – So near but yet so far…

AustCham calls for urgent re-start of negotiations to overcome differences

(The article below is contributed by AustCham Board member, Michael Finucan and provides an update on the Australia Korea Free Trade Agreement (AKFTA) and the work that AustCham has been doing to raise awareness about reviving and concluding the FTA negotiations.)

Following last November’s FTA Roundtable, AustCham, together with Meat and Livestock Australia, have been working on an AKFTA advocacy program. 

The goal of the advocacy program is to raise awareness about the AKFTA and encourage both Governments to return to the negotiating table as soon as possible to conclude the AKFTA. 

The advocacy program is designed to: 

·         Raise awareness of the significant cost impact upon Australian and Korean industries and the opportunity cost of not securing an FTA with Korea; and

·         Elicit strong support from impacted business entities/influential associations in Korea to advocate for a successful conclusion of the FTA.

The AKFTA offers significant opportunities for Australia and Korea to strengthen our complementary bilateral trade and investment relationship, and closer economic integration resulting in a net mutual benefit GDP gain of USD$42billion. 

It is understood that the majority of the text of the agreement has been agreed with negotiations stalled due to an impasse relating to an Investor State Dispute Settlement (ISDS) mechanism in the agreement. The other major issues that need to be negotiated are around market access and tariffs for beef and dairy products.

Working together with affected industries the AustCham advocacy program has been two-pronged with activities undertaken in both Australia and Korea.

In Australia, AustCham has been communicating with organizations such as the Australian-Korea Business Council (AKBC) and the Australian Chamber of Commerce and Industry (ACCI) to help coordinate and support the work of organisations from the agriculture sector. Some of the activities that have been occurring in Australia include:

·         Beef industry representatives have met with key political stakeholders from all sides of politics and have met several times with Trade Minister Craig Emerson

·         The beef industry has written to all federal politicians highlighting the need for urgent conclusion of the AKFTA

·         In February the AKBC together with National Farmers Federation hosted a FTA forum in Sydney which attracted participants from a broad range of industries; finance to agriculture, to manufacturing

·         Later this year the AKFTA will be a major focus of the yearly AKBC/KABC joint meeting to be held in Melbourne on August 28 and 29.

In Korea, AustCham representatives with proactive support from Australian Embassy staff have had a series of very constructive meetings with major Korean industry groups to discuss the AKFTA and look at ways of raising awareness in Korea. So far this year we have met with:

·         Korean International Trade Association (KITA)

·         Korean Importers Association (KOIMA)

·         Federation of Small and Medium Enterprises (Kbiz)

·         Federation of Korean Industry (FKI)

Engagement with these industry bodies is critical so that there is a local voice supporting the AKFTA negotiations. There has been strong support from all of these organizations for the conclusion of the FTA and all are willing to be public advocates when the time is right.

During the week of March 4 to 8 a high level delegation of Australian agriculture industry leaders visited Korea. The delegation was led by Mr. Jock Laurie, President of the National Farmers Federation. The highlight of the delegation’s visit was the AustCham Free Trade Breakfast Forum held at the Grand Intercontinental Hotel on March 7 with approximately 80 participants hearing about the importance of the AKFTA to both the Korean and Australian economies.

At the breakfast forum Dr. Kim Heung Cheong from the Korea Institute for International Economic Policy showed the substantial gains to Korea from the FTAs already in place.  Jock Laurie then spoke directly to the importance benefits of the AKFTA. 

The AustCham Korean advocacy activities have helped to generate significant levels of press related to the AKFTA in both Australia and Korea.

·         March 5, Australian P.M. Julia Gillard wrote a column in the Joong Ang Ilbo entitledKorea and Australia in the Asian Century reaffirming the Federal Government’s position that ‘a bilateral FTA between Australia and Korea will enhance their different economic strengths and bring more flexibility to the economy.’   

·         March 6 in The Australian Newspaper Rowan Callick’s article Arbitration ban a threat to FTAs discussed the Federal Government’s trade policy related to ISDS provisions. This piece was followed up by the same writer in an opinion piece on March 7.

·         On March 11, Mr. John Walker A.M., Chairman of the Macquarie Group of Companies wrote in a Business Focus column in The Korea Times about the costs to both countries of this continuing delay and that the Korea Australia FTA offers significant opportunities to strengthen our complementary bilateral trade and investment relationship.’

·         Jock Laurie wrote an opinion piece on March 25 in The Australian calling upon the Australian Government to prioritize food exports to Asia and resolve the impasse to the KAFTA. 

·         There has also been a long list of rural media covering this issue 

Despite the success of the awareness campaign there has still be no movement in negotiations between the two countries. With an election approaching in September it is unlikely a resolution to the ISDS impasse will be reached however we will continue to advocate to the Government the importance of this FTA. 

To continue on from this initial advocacy program I am very happy to advise that AustCham has formed an FTA Advisory Subcommittee. The subcommittee will keep you updated of any important developments in the negotiations or any upcoming activities that AustCham plans to run.

If you would like any further details on this issue please feel free to contact me directly or 02 3210 8400.

I hope that all AustCham members will support and participate in the AKFTA advocacy campaign. 

Kind Regards,

Mr. Michael Finucan

Meat and Livestock Australia

Chair – AustCham FTA subcommittee

2015-11-10T05:39:55+00:00 November 10th, 2015|

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