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The UK and Australia agree on a post-Brexit free trade agreement

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The United Kingdom and Australia have agreed on the broad terms of a free trade agreement that will become a model for post-Brexit trade policy.

Prime Ministers Boris Johnson and Scott Morrison will announce a principled deal on Tuesday despite farmers in both countries worried about the elements of the deal.

British farmers are scared Concessions that allow duty-free and quota-free imports of Australian cow, lamb and sugar would seriously harm the domestic agricultural sector. Australians are also concerned about welfare standards, including the use of hormones by some cow producers.

Meanwhile, in Australia, farmers have warned that proposals to exempt British backpackers from having to do farm work when renewing visas would exacerbate labor shortages, and destroy the sector.

Johnson and Morrison negotiated broad terms of the agreement when they had dinner on Downing Street on Monday night, they were given the opportunity to make a formal announcement, authorities told the Financial Times.

“The two prime ministers have had a positive meeting overnight in London and have resolved issues related to the ZTL,” Australian Trade Minister’s spokesman Dan Tehan said on Tuesday.

“Their agreement is a victory for employment, for business [and] it highlights what free trade and the two liberal democracies can achieve while working together. “

If the trade agreement could be signed before the end of the year, it would be the first major bilateral agreement negotiated by the UK since leaving the EU in January 2020. Japan and Norway They were built according to the agreements that were negotiated while the UK was a member of the EU.

Mark Melatos, an associate professor at the University of Sydney, said the Australian agreement is significant for the UK, but a two-edged sword.

“On the one hand, it shows that the UK can make bilateral trade agreements after Brexit, albeit with a very close friend, Australia. That’s important for political optics, ”he said.

“On the other hand, this agreement sets a precedent for the post-UK negotiations, which are likely to be more complicated.” Any concession granted to Australia will now be the basis for the start of negotiations with the US, the EU and so on. “

The Australian Agricultural Company, the country’s largest meat exporter, has announced meat exports have increased tenfold If the UK agrees to a zero tariff agreement.

But Australian farmers have struggled to get rid of the requirement for UK holiday backpackers to extend their working holiday visas on farms for at least 88 working days.

Australian Agriculture Minister David Littleproud said on Tuesday that Canberra would introduce mechanisms to replace 10,000 British backpackers working in the Australian agricultural sector with alternative work if required by the trade agreement.

The government has estimated that a free trade agreement with Australia would have an additional 0.01-0.02 per cent of gross domestic product over the next 15 years, or £ 200 million – £ 500 million more than 2018 levels.

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