The China–Australia Free Trade Agreement (ChAFTA) is a bilateral Free Trade Agreement (FTA) between the governments of Australia and China. Since the announcement of a joint feasibility study in early 2005, 21 negotiating rounds have been completed and the announcement of the conclusion of negotiations was made by Australia’s Prime Minister Tony Abbott and Chinese President Xi Jinping on 17th November 2014.
The long-awaited agreement was signed by Trade Minister Andrew Robb and Chinese Commerce Minister Gao Hucheng last Wednesday in Canberra. The agreement is expected to open the vast Chinese market for Australian investment, primary products and services.
The agreement will ensure 85 per cent of all Australian exports will enter China tariff-free, rising to 93 per cent within four years and 95 per cent when it is in full force.
China is Australia’s largest trading partner, with the two-way flow of goods and services exceeding $160 billion last year.
Now that both sides have completed the legal review and translation of the text of the Agreement the signature of the Agreement;
What happens next…
- The text of the Agreement, accompanied by a National Interest Analysis, will then be tabled in the Australian Parliament for 20 joint sitting days;
- Following tabling, the Joint Standing Committee on Treaties (JSCOT) will conduct an inquiry into the Agreement and will report back to Parliament;
- Legislation will be introduced to make any necessary amendments to existing legislation and will be considered by the Parliament;
- Relevant Regulations would also be amended in due course;
- During this time, the Chinese Government will undertake its own domestic treaty-making processes;
- When Australia and China have completed their domestic processes, both countries will exchange diplomatic notes to certify that they are ready for the Agreement to enter into force;
- 30 days after this exchange or on a date otherwise agreed, ChAFTA will enter into force.
Because it is expected that the above processes will take some time, the agreement is not anticipated to take effect until sometime in early 2016.
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