Scrutiny of international agreements: UK-Australia free trade agreement Contents

Scrutiny of international agreements: UK-Australia free trade agreement

Chapter 1: Introduction

This report and inquiry

1.This is our first report on a free trade agreement negotiated by the UK Government from scratch, that is without reference to a predecessor EU agreement.

2.In 2021, Australia was the UK’s 22nd largest trading partner, accounting for 1.1% of total UK trade.1

3.In economic terms, the agreement is forecast to have a modest positive impact. The Government’s impact assessment anticipates a 0.08% increase to GDP by 2035—although increased collaboration and positive dynamic effects not captured by the modelling may unlock further benefits over time, particularly in services and digital trade.

4.This agreement is, however, politically significant, providing an indication of the UK Government’s approach to trade after Brexit.

5.The agreement also helps pave the way for the UK’s accession to CPTPP. As the then High Commissioner told us, Australia “would have been in a strange position to be championing the UK’s accession into the CPTPP if we had not been able to do an FTA with you ourselves”.2 The UK Government was also able to secure a commitment during the negotiations that Australia would not seek additional market access or faster tariff reduction through the CPTPP negotiations, thus providing a degree of certainty for those negotiations.

6.We opened our inquiry into the UK-Australia free trade agreement (FTA) in July 2020 and held six evidence sessions on the negotiations, the agreement in principle, and the final agreement. We heard further evidence as part of our inquiry on the UK’s accession to the CPTPP. In total, we received 53 written submissions. We are grateful to all those who contributed to our inquiry (see Appendix 2).

7.Our findings take into account feedback on the agreement from relevant stakeholders and we have assessed whether the final text reflects the Government’s own stated Negotiating Objectives (enclosed at Appendix 3).

8.We make this report to the House for debate.

2  Q 93 (HE George Brandis)

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