Disadvantages Of China Australia Free Trade Agreement

The main criticism of free trade agreements is that they are responsible for the outsourcing of employment. There are seven drawbacks: countries can insist that foreign companies build local factories as part of the deal. They may require these companies to share technology and form a local workforce. The pros and cons of free trade agreements have effects on jobs, business growth and living standards: the benefits for Australians exporting goods to China are significant and range from the removal or reduction of tariffs, increasing quotas for certain restricted items and streamlined customs procedures. In total, 98% of Australian products exported to China are entitled to enter duty-free or at preferential rates. Essentially, the negotiated terms have given Australia a significant competitive advantage in the Chinese market over some of our main competitors such as the US, Canada, the EU and New Zealand, particularly for our agriculture and the processed food sector. Among the key results, Australia and China signed the China-Australia Free Trade Agreement (ChAFTA) on 17 June 2015, which will enter into force on 20 December 2015. Trade negotiations have secured many future benefits for Australian business with Australia`s largest trading partner, China. It is mainly those who work in the agriculture, manufacturing, services, investment, resources and energy sectors who benefit. China has also agreed to a special clause that recognizes Australia as a « most-favoured-nation » (MFN).

This allows Australian companies to access the same agreements that China refuses to enter into in free trade agreements with other nations (such as the United States) that could offer better access to the Chinese market. Free trade agreements are intended to increase trade between two or more countries. Strengthened international trade has the following six main advantages: the Chinese market is experiencing a boom, as an ever-increasing percentage of the population connects to the world of digital activity. . . .