What’s an FTA worth to you?
The China-Australia Free Trade Agreement came into force 20th December 2015, adding to existing free trade agreements with Japan, Korea, Malayasia, Singapore and Thailand.
In theory at least these agreements give us access to the Asian middle-class, by far the fastest growing discretionary spending market in the world, with an appetite for better and more varied food.
The almost-completed, formerly 12-nation Trans-Pacific Partnerhsip (TT) would have drawn together and extended existing agreements but it’s been dealt a possibly fatal blow by the Trump administration’s withdrawal of the USA. The Australian Government is trying to keep the deal alive without the US.
So just how much are free trade agreements worth to us?…
An FTA does not do anything so much as allow things to be done. It allows Australian producers to promote into overseas markets but does not guarantee that anyone will buy.
That’s up to the market.
Australian produce will only be sold if someone takes it to a market, promotes it, finds buyers, persuades them, does deals. There’s real work to be done, competitors who have to be beaten.
Not many rural producers get to sell direct to market, they are more likely to sell to intermediaries like abattoirs, the AWB and through Australian Wool Exchange auctions. So they do not deal direct with overseas buyers or consumers. They leave the marketing to others.
But is enough being done? Is Australian produce being pushed hard enough?
Asian middle class consumer habits are being shape right now and nations are competing for space on their plates and in their bowls.
Guest post by Michael Woodhouse, business consultant at Glide.co