Today, Minister for Trade and Investment Andrew Robb and his South Korean counterpart, the Minister for Trade, Industry and Energy Yoon Sang-jick, formally signed the Korea-Australia Free Trade Agreement (KAFTA) in Seoul.
This comes on the back of the successful conclusion of negotiations for an Economic Partnership Agreement with Japan, our second biggest trading partner, which the Abbott Government announced yesterday.
“The Government’s swift conclusion of these historic agreements sends a strong signal that Australia is indeed open for business. With one in five Australian jobs linked to trade, these agreements are good for the economy, good for growth and good for job creation,” Mr Robb said.
Independent modelling commissioned by the Government shows that KAFTA will create at least 15,000 jobs between 2015 and 2030. In 2015 the modelling shows job gains of 1750, with average gains of 1000 in each and every year out to 2030.
The modelling also shows that that KAFTA will add $650 million dollars to the Australian economy annually once in full force.
Agricultural exports to South Korea are expected to be 73 per cent higher after 15 years as a result of the FTA and overall exports to South Korea will be 25 per cent higher.
“Building stronger trading relationships in Asia is critical to Australia’s economic future. Signing KAFTA today takes us closer to realising our goal of finalising FTAs with our major North Asian partners – China, Japan and South Korea – which together account for 37 per cent of Australia’s overall trade and two-thirds of our total goods exports,” Mr Robb said.
South Korea is Australia’s fourth-largest trading partner, with bilateral trade worth $32 billion in 2012. KAFTA will significantly boost Australia's position in this major market where competitors like the United States, European Union and ASEAN countries are already benefitting from preferential access. On entry into force of KAFTA, 84 per cent of Australia’s exports (by value) to South Korea will enter duty free, rising to 99.8 per cent on full implementation of the Agreement. There will also be significant new market openings in services and investment.
Mr Robb expects KAFTA to be in force by the end of this year.
The full text of the Korea-Australia FTA can accessed on the Department of Foreign Affairs and Trade website: www.dfat.gov.au/fta/kafta/
- Trade Minister's Office: (02) 6277 7420
- DFAT Media Liaison: (02) 6261 1555