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No white flag on TPP as Trump prepares to assume White House

20 January 2017

The National Farmers Federation will continue to apply pressure on the Government to push ahead with the Trans Pacific Partnership (TPP) despite President-elect Donald Trump now only hours away from occupying the White House.

Throughout his campaign President-elect Trump had vowed to kill the United States' involvement in deal as a matter of priority after assuming office.

NFF Chief Executive Tony Mahar said the benefits of the landmark deal were too significant for Australia’s farming sector to give up.

“The opportunities presented by the TPP have the potential to be transformational for our already-strong export industry.

“Commodities across-the-board stand to gain including red meat, dairy, fruit and vegetables, cotton, wool, sugar, grain and seafood.”

However Mr Mahar said if the US pulled out the TPP was not necessarily dead in the water.

“There’s more than one way to skin a cat. While it would be preferable to have the US remain a party the most significant gains for Australia lie with the deals struck with Japan, Mexico, Argentina and Canada.”

“To this end we were buoyed by discussions between Prime Minister Turnbull and his Japanese counterpart Prime Minister Abe last weekend on how to progress negotiations.

“We particularly welcome Prime Minister Turnbull’s commitment to ratifying the deal – despite the uncertainty following the result of the US election,” Mr Mahar said.

“In 2016 the Joint Standing Committee on Treaties (JSCOT) recommended that Parliament ratify the deal – in part because of the significant benefits the TPP would deliver Australian agriculture exports.”

Mr Mahar said the on-foot Regional Cooperative Economic Partnership (RCEP) agreement could also deliver benefits to Australian farmers.

“RCEP is crucial to enhancing trade between Australia and Indonesia. RCEP and the TPP operating in tandem would be a trade double-somersault for Australia.”

In 2017 Mr Mahar urged all parliamentarians to maintain a bi-partisan approach to trade and said any move away from this would be detrimental to Australia’s national interest.

“Trade is good for the economy – Australian agricultural exports are our second biggest industry - second only to iron ore.” Mr Mahar said.

“We look forward to the Government’s progressing the ratification the TPP in the 2017 Parliamentary year as a matter of priority.”

What the TPP would deliver agriculture

  • In the red meat sector, beef tariffs will be further reduced in Japan and Mexico.
  • Tariffs on sheep meat exports to Mexico will be eliminated in eight years and from day one of the agreement coming into effect in all other TPP countries.
  • In the grains sector, the agreement will result in the creation of new quota volumes for wheat and barley exports to Japan under the simultaneous buy-sell mechanism which were worth approximately $481 million in 2014. It will also provide for new quota access for roasted malt exports, while tariffs on exports of Australian wheat and barley to Mexico will be eliminated.
  • For the rice sector, the TPP results in new quota access into Japan with a new 6,000 tonne quota from entry into force, a reduction in tariffs on a number of rice preparation products, and an amendment to the WTO quota of an extra 60,000 tonnes of medium grain rice for processing use.
  • The TPP will eliminate all remaining tariffs on Australian raw wool and cotton exports to TPP countries from day one of the agreement coming into effect and also deliver improved rules of origin for textiles, which will encourage greater demand for Australian fibre products.
  • In the dairy sector, the TPP will improve on the Japan Australia bilateral agreement to eliminate tariffs on certain cheese products, and provide tariff reductions and new quota allocations for remaining cheese products.
  • In the horticulture sector, the TPP will result in the elimination of all Canada’s horticulture tariffs and most of Mexico’s tariffs upon entry into force and most of Peru’s horticulture tariffs (currently up to 17 per cent) after 15 years.

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