Come January 1, 2010 Australia’s closest neighbours are opening their doors to free trade with us Aussies. If you’d like to take advantage of the opportunities that come with this, you’ll need a sound trade strategy and the right documentation. Australian Business International Trade Services can assist with both.
What’s the story?
The expected ratification of the ASEAN Australia New Zealand Free Trade Agreement (AANZFTA) on January 1, 2010 will provide a progressive reduction, or in most cases, elimination of tariffs on Australian good exports, and an elimination of ALL Australian tariffs on imports from AANZFTA parties.
The agreement covers goods, services, investment, intellectual property, e-commerce, temporary movement of business people as well as economic cooperation. It also contains measures relating to customs procedures and cooperation, sanitary and phytosanitary measures, standards, technical regulations and conformity assessment procedures and competition policy.
What does this mean for you?
Australian goods and services will now be more competitive in the 11 countries [Brunei, Burma, (Myanmar), Cambodia, Indonesia, Laos, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam] participating in the agreement. It also means that imports from these countries will become cheaper, it will be easier for Australian service providers to do business with these countries and Australian investors in ASEAN will achieve a greater level of transparency and certainty.
What you need to know
- You require the right documentation
To take advantage of the tariff reductions and greater market access, Australian merchandise exporters will need to obtain an AANZFTA Certificate of Origin for each order; verifying the origin of your product. Australian importers will also need to ensure their suppliers understand the AANZFTA protocol and include the appropriate documentation with their shipments.
- Varying timelines for tariff reductions means a blanket approach won’t work
The tariff reductions and eliminations timeframe varies according to product and country in question. It therefore pays to do your homework on the specific timeframes for each country and then develop a strategy based on which market you should enter first or when and where you should switch suppliers.
- If you don’t use this head start, you will lose it
The AANZFTA provides Australian businesses with a clear advantage over countries that are have yet to sign FTAs with ASEAN. However, with China, Korea, Japan and India having already established FTAs with ASEAN, as well as a number of countries having bi-lateral FTAs with individual ASEAN countries, and more FTAs in the pipeline, if you don’t take advantage of this opportunity now or in the near future, you will lose it.
- You can choose which FTA you’d like to use
The bilateral FTAs Australia has with New Zealand, Singapore and Thailand will not be affected by AANZFTA, providing you meet the Rules of Origin (ROO) under the relevant FTA. In fact, you can choose which FTA you wish to trade under depending on what is most advantageous. The AANZFTA will, however, mean that Australian businesses already trading with Singapore, Thailand and New Zealand can make use of the AANZFTAs regional ROO under the agreement’s tariff commitments, making it easier to do business in and with the ASEAN region as a whole. The variables that come into play in switching between FTAs does mean greater complexity in developing a coherent export strategy into the region, making added caution essential.
Want to know more?
Australian Business International Trade Services can provide all your AANZFTA export documentation and market development requirements. We will be offering a range of workshops in 2010 covering topics including export documentation, strategies for developing ASEAN export markets, importing under the AANZFTA, and identifying the right ASEAN supplier. For more information, download our ASEAN brochure.
To find out more and ensure you maximise your competitive advantage, register your interest now.
Click here for a list of “ASEAN Made Easy” workshops throughout Sydney, the ACT and the Central Coast.