UK to offer Australia tariff-free trade deal despite farmers’ fearson May 21, 2021 at 9:45 am

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Boris Johnson pushes for an end to import taxes, but farmers say their livelihoods are under threat.

Australian mine

image copyrightReuters

The UK is to offer Australia a trade deal under which both countries would phase out import taxes over 15 years.

The cabinet was reportedly split on what terms to propose, amid concerns UK beef and lamb farmers could be undercut by larger Australian producers.

But Boris Johnson pushed for unity at a senior ministers’ meeting on Thursday.

Downing Street said the cabinet was now in agreement, but a farmers’ union said ending taxes on meat imports would lead to the “demise” of many UK farms.

Ministers are keen to strike as many trade deals as possible following Brexit, and International Trade Secretary Liz Truss wants one in place with Australia by early June.

But she had reportedly been at odds with Environment Secretary George Eustice over the possible impact on farmers.

Speaking on a visit to a bakery in north London, Home Secretary Priti Patel said: “The government is united on every single level. We are working at every level to secure the best outcome for our country.”

She added that “the government will work with everybody – everyone – to ensure that the right sort of support and measures are in place”.

Under the deal set to be offered to Australia, tariffs – taxes on imports – will be phased out over 15 years, with quotas – limits – on sales between the two countries going over the same period.


image copyrightReuters

In 2019-20, trade in goods and services between Australia and the UK was valued at £20.1bn, and both sides are hoping to expand this amount considerably.

Currently, metals, wine and machines form the biggest goods exports from Australia to the UK, while Australia’s main UK imports are cars, medicines and alcoholic drinks.

Trade in meat between the two countries is very small, but the National Farmers’ Union (NFU) has warned that pitting small-scale UK beef and lamb producers against vast Australian cattle and sheep stations could force many of them out of business.

Approximately 0.15% of all Australian beef exports go to the UK, and, last year, 14% of sheep meat imports to the UK came from Australia.

NFU president Minette Batters said removing tariffs on these products would “have a massive impact on British farming”.

She added: “We continue to maintain that a tariff-free trade deal with Australia will jeopardise our own farming industry and will cause the demise of many, many beef and sheep farms throughout the UK. This is true whether tariffs are dropped immediately or in 15 years’ time.”

She added: “We remain of the view that it is wholly irresponsible for government to sign a trade deal with no tariffs or quotas on sensitive products and which therefore undermines our own domestic economy and businesses.”

The Scottish and Welsh governments have both urged Mr Johnson to ensure UK farmers are not left exposed by any free-trade deal.

The prime minister’s spokesman said: “Any agreement would include protections for our agriculture industry and won’t undercut UK farmers.

“We want a deal that is good for the British public and any agreement would have protection for the agriculture industry.”

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