On November 10th, the Australian government announced that they have come to an agreement with Peru to form an ambitious Free Trade deal that will go into effect hopefully sometime soon. The agreement has yet to be signed but here are some agricultural outcomes of the agreement:
- Sugar: on entry into force of the agreement, Australia will have duty free access for 30,000 tonnes of sugar into Peru, growing to 60,000 tonnes in five years and 90,000 tonnes in 18 years – this is more than any other sugar exporting country has achieved in the last twenty years.
- Beef cuts: tariffs (up to 17 per cent) will be eliminated within five years – this ensures Australian beef farmers will have duty free access to the Peruvian market at the same time as US farmers.
- Dairy: on entry into force of the agreement, Australia will have duty free access of 7,000 tonnes of dairy products into Peru, growing to 10,000 tonnes in five years.
Now, these are just a small sample of some of the outcomes of the deal but the basic premise is that Australia will benefit heavily by having this deal with Peru, as it has one of the worlds largest growing economies. As of last year, Peru exported 4.6 Billion U.S. dollars worth of agricultural goods, which is mind-blowing. Australia only exported $5.3 million dollars worth of exports to Peru because of tariffs blocking the way and more preferential treatment toward competitors like the United States. with this deal, 99 percent of the tariffs will be eliminated, giving Australia more access to this growing Peruvian economy.