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Japan, South Korea & Australia ink trade deal

Japan, South Korea and Australia have signed a free trade agreement. A combination of bilateral deals between the three countries is being described as a “major windfall for Australian beef” most likely at the expense of U.S. beef.

As part of the Korean pact; Australia will drop tariffs on Korean cars over the next three years and Korea will eliminate a 40 percent import duty on Australian beef over the next 15 years beginning with an 8 percent cut this year. Australia already supplies more than half of Korea’s beef imports while the U.S. supplied 34 percent last year.

The deal with Japan will reduce their current 38.5 percent tariff on Australian beef to 19.5 percent in 18 years. It reduces tariffs on a variety of vegetables and eliminates the tariff on Australian sugar and seafood.

The deal also reduces Japan’s tariffs on Australian dairy products and raises the amount of duty-free cheese from 27,000 to 47,000 metric tonnes per year. Japan bought more than $500 million in dairy products from Australia last year with exporters paying more than $100 million in tariffs and other costs. Under the new trade deal, those charges will be reduced by about $11 million by 2031. Australian producers had hoped for reductions of around $60 million.

In return, Australia lowers tariffs on Japanese cars, appliances, electronics and other items.