Korean FTA Important for Australian Beef Industry

AUSTRALIA - Meat and Livestock Australia Managing Director, David Palmer has accompanied Federal Minister for Agriculture, Fisheries and Forestry, Tony Burke in Korea over the past two days to lend support for the commencement of free trade agreement (FTA) negotiations between Australia and Korea.

11 April 2008

2 minute read

Oceania

Meat and Livestock Australia Managing Director, David Palmer

All beef imported into Korea, including that from Australia, currently faces a 40 percent tariff.

The issue of a FTA between Australia and Korea has gained significant importance since the formalisation last year of a FTA between Korea and the US. Although the Korea/US FTA was signed last April, it is yet to be ratified by either government.

Under the proposed Korea/US FTA the tariff on US beef into Korea will be reduced from 40 percent to zero over 15 years. Prior to the discovery of BSE in the US herd four years ago, the US was the largest exporter of beef to Korea, a position since taken by Australia.

"A FTA with Korea is an imperative for the Australian beef industry especially in light of the FTA Korea negotiated with the US, which will obviously make Australian beef comparatively less price competitive when it is implemented," Mr Palmer said.

"There have been encouraging signals from both the Korean and Australian Governments regarding the commencement of a possible negotiation. However, it should not be taken for granted that a FTA is imminent or possible."

A feasibility study, carried out on behalf of the Australian Department of Foreign Affairs and Trade (DFAT) by an independent research agency, has been instigated and is the first step in the FTA process with Korea. The study examines the pros and cons of a FTA for all sectors in the Australian economy, including agriculture.

Assuming inter-government negotiations begin, it could take up to three years to bring any FTA with Korea to fruition.

In cooperation with the Australian Embassy in Seoul and DFAT in Canberra, MLA’s office in Korea has embarked upon an FTA advocacy programme to position Australian beef for at least parity of access given the outcome from the Korea/US FTA.

"MLA will continue to liaise closely with industry peak councils and the Australian Government as the FTA feasibility process proceeds and should FTA negotiations commence," Mr Palmer said.

"While the commencement date of the Korea/US FTA is currently unknown, Australia cannot delay in its negotiation of a level playing field before the tariff on US beef begins to fall.

"It is heartening that Minister Burke has identified this and made his first international trip as Agriculture Minister to this vital market for Australian beef producers."

Mr Palmer will be accompanying Minister Bourke in Korea for two days and will be providing the Minister with an insight into Australia’s third largest beef export market.