Now is the time for Australia and the UK to rejuvenate economic ties
The UK and Australia may stand almost 10,000 miles apart, but when you look at our shared history, traditions, complementary economies, model of government and legal systems, not to mention our Ashes rivalry, metaphorically we stand shoulder to shoulder.
Around a quarter of people in Australia claim British ancestry, and Australia has long been a favourite destination for UK tourists, with over 700,000 Brits visiting last year. There is also a long tradition of young Australians travelling to the UK to live, work and study. Many young Britons experience the Australian way of life too, under our Working Holiday Visa scheme. Your Prime Minister encountered the joys of Australia’s great outdoors in his own formative years, camping overnight on a Canberra roundabout when he was 18. Who said the British don’t share Australians’ love of adventure?
But while our people-to-people links have gone from strength to strength, our economic ties have not kept pace. When the UK entered the European Economic Community in 1973, the UK went from being our third largest two-way goods trading partner, to now 12th. UK companies looked to EU opportunities. UK consumers turned away from Australian produce when high tariffs and low quotas were imposed.
From crisis, though, comes opportunity. In the 1660s when colleges at Cambridge closed due to the plague, Isaac Newton went home to Woolsthorpe to think a bit more about the concept of gravity. Today’s crisis may not result in a discovery of such magnitude, but there are so many areas where our two economies can complement each other. Countries have not traded for millennia because of altruism. They do so for the mutual net benefits it brings.
Few of us could have foreseen the human tragedy and economic devastation the Covid-19 pandemic would inflict on the world. But when Australia and the UK work together, we can overcome great challenges. We have done so in response to Covid-19: from cooperation to get our citizens home safe, to working in global forums like the G20 to keep essential goods flowing, and collaboration on medical research as the world continues to work towards a vaccine.
We might have some friendly banter on the sporting field, but the show of support and generosity extended to Australians from our British friends over the Christmas period, when we were experiencing some of the worst bushfires in our history, is what abiding friendship is all about.
Now, as bushfire-affected regions across Australia continue to rebuild, and both our nations begin to shift focus towards the economic recovery from Covid-19, a UK-Australia free trade agreement can help to expand our opportunities and secure stronger supply chains to withstand better future shocks.
Today, International Trade Secretary Liz Truss and I will officially commence negotiations on that bilateral free trade agreement.
We worked hard to ensure we were well placed to kick-off talks as soon as that was possible. Australia was the first country to establish a trade working group with the UK — in September 2016 — to lay the groundwork for what we hope will be a comprehensive and ambitious free trade deal.
Why Australia? Why not? Take wine. One in five bottles of wine sold in the UK is from Australia (despite facing a tariff that doesn’t currently apply to European wines). In medical services, Australian firm Cochlear is one of the largest suppliers of implantable hearing devices across the UK, while Sonic Healthcare provides a number of services for the NHS.
Likewise, Australia offers huge opportunities for UK firms. London’s global reputation as the financial capital of the world stands to benefit as we deepen our links in financial services. There is also real potential to grow our wider services trade well beyond the $15 billion of value it generates now.
Australia is ready to help the UK find new beginnings and in doing so create more opportunities for businesses and innovative industries as we rediscover why we used to trade more with each other — because of the quality of our people and what we produce; and because, when it comes down to it, we can rely on each other when times get tough.
Simon Birmingham is Australia’s Minister for Trade, Tourism and Investment.
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