The United Kingdom and Australia have agreed on the broad terms of a trade agreement, which is expected to become a model for Britain’s post-Brexit business policy.

Despite the concerns raised by farmers in the two countries, Prime Minister Boris Johnson and Scott Morrison signed an agreement in principle on Downing Street on Monday night.

The agreement will eliminate tariffs on British goods, but there will be a 15-year transition period and quotas. The liberalization of some products, such as cheese, will be carried out in stages to help transform the agricultural market. Britons will be able to work and travel in Australia more easily.

“Our new free trade agreement provides great opportunities for British businesses and consumers and young people who want to have the opportunity to work and live on the other side of the world,” Johnson said.

International Trade Secretary Liz Truss said the agreement paved the way for Britain to join the 11-nation comprehensive and progressive Trans-Pacific Partnership.

“Membership will create unprecedented opportunities for our farmers, manufacturers, innovators, and investors to conduct business in the future engine of the global economy,” she said.

British farmers are afraid Concessions that allow tariff-free and quota-free imports of Australian beef, lamb and sugar will seriously damage the domestic agricultural sector. They are also worried about Australia’s welfare standards, including the use of hormones by some beef producers.

At the same time, in Australia, farmers have warned that the proposal to exempt British backpackers from having to work on farms when renewing visas will exacerbate labor shortages and disrupt the industry.

A spokesman for Australian Trade Minister Dantham said on Tuesday: “The two prime ministers met in London overnight and resolved outstanding issues related to the free trade agreement.”

“Their agreement is a victory for employment and business [and] Free trade, and emphasized what two free democracies can achieve when they cooperate. “

If the trade agreement can be signed before the end of the year, it will mark the first large-scale bilateral agreement negotiated entirely by the United Kingdom since the United Kingdom left the European Union in January 2020. Japan with Norway Build on existing arrangements negotiated when the United Kingdom was a member of the European Union.

Associate Professor Mark Melatos of the University of Sydney said that the Australian agreement is of great significance to the United Kingdom, but Double-edged sword.

“On the one hand, this shows that the UK can conclude a bilateral trade agreement after Brexit, even with a very close friend Australia. This is important to political optics,” he said.

Brexit briefing

Pay attention to major issues caused by Brexit. Get the Brexit newsletter in your inbox every Thursday. Register here.

“On the other hand, this transaction sets a precedent for a potentially more complex deal that the UK will negotiate later. Any concessions given to Australia now will become the benchmark for future negotiations with the United States, the European Union, etc.”

Australia’s largest beef exporter, Australian Agriculture Corporation forecast Beef exports increased tenfold If a zero-tariff agreement is reached, it will be against the United Kingdom.

However, Australian farmers objected to Britain’s request to cancel the requirement for British backpackers to work on farms for at least 88 days in order to extend their working holiday visas.

Australian Agriculture Minister David Littleproud said on Tuesday that Canberra will introduce a mechanism to replace the approximately 10,000 British backpackers working in the Australian agricultural sector if the trade agreement requires it.

The government estimates that the free trade agreement with Australia will increase GDP by 0.01-0.02% within 15 years, or between 200 million and 500 million pounds higher than 2018 levels.

Trade secrets

The British “Financial Times” revised “Trade Secrets”, which is its must-read daily newsletter on the changing face of international trade and globalization.

Register here Learn which countries, companies, and technologies are shaping the new global economy.