Trade Minister Mark Vaile will discuss in coming weeks with his US counterpart, United States Trade Representative Bob Zoellick, how to progress the proposal for a Free Trade Agreement (FTA) between Australia and the US.

"During their meeting in Washington, Prime Minister Howard and President Bush reaffirmed their commitment to enhance our close economic relationship, including the possibility of an FTA," Mr Vaile said.

"Bob Zoellick and I have been tasked with reporting back before the end of the year on how to advance the proposal.

"We already know there could be significant benefits accruing for Australia from such a proposal. 

"A study conducted by the Centre for International Economics found that an FTA could increase Australia's real GDP by almost $US2 billion by the year 2010. 

"Monash University's APEC Study Centre found that Australian businesses would benefit from increased access to the world's largest economy.  There would also be increased US investment in Australia and expanded linkages with the dynamic US new economy and leading edge business practices.

Mr Vaile met several times last week with Ambassador Zoellick at both the World Trade Organisation mini-ministerial meeting in Mexico and the Cairns Group meeting in Uruguay.

"If an FTA is to be negotiated between Australia and the US, I am committed to a quality agreement that would hold real benefits for Australia.  I look forward to canvassing ways to progress the proposal with Ambassador Zoellick," Mr Vaile said.

"The Australian Government certainly understands the US domestic political environment and the importance of President Bush getting Trade Promotion Authority from the Congress.

"I also welcome confirmation from President Bush that launching a new global trade round later in Doha this year is a number one priority for his administration, and that agriculture must form a core element of the next trade round.

"Last week the Cairns Group reaffirmed its commitment to having agriculture firmly on the agenda of a new WTO round in the presence of USTR Zoellick, and it is encouraging that the largest economy in the world shares that commitment."