Agriculture to Benefit from Malaysian FTA

AUSTRALIA - Minister for Agriculture, Fisheries and Forestry, Senator Joe Ludwig, has welcomed the Free Trade Agreement (FTA) signed by Trade Minister Craig Emerson and his Malaysian counterpart, Mustapa Mohamed.
calendar icon 24 May 2012
clock icon 2 minute read

The agreement will allow annual increases in Australian exports of liquid milk at zero tariff, the immediate elimination of tariffs on processed foods and the phase out of tariffs on tropical fruit by 2016.

“Malaysia is our ninth largest market for Australian agricultural products and our seventh largest market for dairy products,” Minister Ludwig said.

“This agreement with Malaysia will offer increased opportunities for Australia’s farmers to export even more of their products to Malaysia. It builds on the outcomes already achieved under the ASEAN-Australia-New Zealand Free Trade Agreement.

“The outcomes are especially relevant for liquid milk, tropical fruit, opening up greater markets for these important producers or ensuring their competitive position.”

The National Farmers’ Federation (NFF) also welcomed the signing.

“After seven years of negotiation, the NFF is under no illusion of how challenging it has been to complete this FTA with Malaysia,” National Farmers’ Federation Vice President Duncan Fraser said.

“Protectionist sentiment around agricultural goods is rife and growing across the globe, so in this context it is pleasing that Australia has managed to forge an agreement with Malaysia that has dealt with some sensitive agricultural issues that were not effectively covered by AANZFTA.

“While under the AANZFTA agreement, most of Australian agriculture’s key interests had tariffs bound at zero, dairy and rice are two sectors where incremental market access improvements have been negotiated under the Malaysian FTA.

“This trade deal was also particularly important for sectors such as dairy that have been facing a competitive disadvantage in Malaysia compared with New Zealand who have already had a completed FTA with Malaysia in place.

Australian agribusiness exporters will also benefit from:

  • tariff elimination by 2016 for melons, mangoes, pineapples and longans.
  • open access arrangements for Australian rice from 2023, allowing importation of retail product, and the elimination of all tariffs on rice from 2026 – a significant commitment by a rice producer in Asia;.
  • a commitment that Australian wine exporters will receive any reduction in tariffs that Malaysia gives to any other country;
  • more commercially meaningful tariff quota access for some other agricultural products including some pork products;
  • business-friendly rules of origin provisions, including a simpler declaration of origin instead of certificate of origin requirements for exporters; and
  • arrangements which make it easier for Australian goods traders and investors to work in Malaysia, and to stay for longer periods.

The agreement also provides for strengthened consultation arrangements, where market access issues can be addressed.

The agreement is expected to enter into force in 2013, following ratification in each country.

Malaysia is Australia’s tenth largest trading partner with two-way trade between Australia and Malaysia exceeding $16 billion in 2011.

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