May 13, 2020


Australian-Indonesian free trade agreement to begin in July



Australia's free trade agreement with Indonesia will finally kick in on July 5 - 15 years since negotiations began, reported Stock & Land.


There will be big wins for Australian farmers. The tariff on frozen sheep meat and beef will halve overnight to 2.5%, disappearing altogether over five years.


There will be duty-free access for 500,000 tonnes of feed grains this year, with that volume growing by 5% a year. Tariffs on a range of dairy products will also gradually fall to zero within five years.


Indonesia is the fifth biggest importer of dairy products in the world and Australia's dairy exports to the burgeoning economy grew 20.7% over five years.


Australian Meat Industry Council (AMIC) chief executive Patrick Hutchinson was very pleased the agreement would soon be in force.


"The opportunity to have 99% of our goods by value going in duty free or with significantly improved preferential treatments is fantastic for us," Hutchinson said.


While celebrating the enactment of the free trade agreement, Hutchinson said AMIC would continue to work on reducing non-tariff trade barriers.


"We need to be licensed to export to Indonesia," he said. "Halal is a vital component of that licence and there are times where some of those licence parameters have changed. And when they change, we need to continue to be working with Indonesia."


Australian Dairy Products Federation chair Grant Crothers also welcomed the news.


"Indonesia is a wonderful market and an obviously growing market where we compete ferociously with Europeans and New Zealanders," Crothers said. "Any advantage we can have over our competitors will only help the industry."


According to Dairy Australia, Indonesia imported more than 51,000 tonnes of Australian dairy product worth AUD114.4 million between January 2018 and December 2019.

Video >

Follow Us