Countries Strengthen Ties by Signing Free Trade Agreement
After ten years of negotiations the China Australia Chamber of Commerce finally signed the China Australia Free Trade Agreement of ChAFTA. The signed agreement will allow both countries to have closer ties and shows China’s growing influence in the Asia Pacific region. The full test of the ChAFTA document will be released and the head of the Ministry of Commerce will be visiting Australia next week to finalize the agreement.
Both countries signed a declaration of intent which symbolize the conclusion of the ChAFTA negotiations in November of last year when President Xi Jinping visited Australia After the G20 summit. Based on the results of the negotiations that started in April 2005 in which most Australian products to China will eventually enjoy duty free entry and China’s exports to Australia will enjoy the same benefits as well. Both countries also promised to ensure a wide and high quality opening up in the service sector and in terms of investment in which both agreed to grant the most favored nation status and lower review thresholds for corporate investments.
The agreement will ensure deeper and long term cooperation between the two countries as the they are complementary in resources and industries. Australia is rich in minerals with a small population and China offers a labor intensive manufacturing industries. The five top exports of Australia are iron and concentrates, educational travel services, copper and gold. While China exports Re telecommunication equipment, clothing, furniture and computers.