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Minerals sector strongly supports Trans Pacific Partnership deal – MCA

18th October 2016

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – The Minerals Council of Australia (MCA) has again thrown its weight behind the Trans Pacific Partnership (TPP) Agreement, telling the Joint Standing Committee on Treaties that it is important to make a success of the initiative in order to attract other Asian trading nations, including Korea, China, India and the Philippines.

The TPP is a regional free trade agreement, and the 12 TPP countries, which include among others Canada, the US, Japan, Chile, New Zealand and Peru, make up about 40% of global gross domestic product. In 2015, one-third of Australia's total goods and services exports, about A$109-billion, were sent to TPP countries.

It is hoped that the TPP will allow for new market access opportunities for Australian exporters of goods and services and will also establish a more seamless trade and investment environment across 12 countries by setting commonly-agreed rules and promoting transparency of laws and regulations.

MCA CEO Brendan Pearson told a committee hearing that the minerals sector was strongly in support of Australia’s ratification of the TPP.

He noted that the TPP would reduce or eliminate a range of tariff and nontariff barriers to trade and investment in the mineral sector, abolishing tariffs on key Australian minerals, facilitating the expansion of exports of Australian mining equipment, technology and services, and creating new opportunities for Australian miners to find and develop reserves among the agreement’s 12 countries.

“For these minerals exports, the TPP will lock in the duty- and quota-free access Australia currently enjoys into a number of TPP countries for major exports such as coal and iron-ore. In addition, the TPP removes Peru’s tariffs on iron-ore, copper, nickel and inorganic chemicals upon entry into force of the TPP,” Pearson said.

He noted that the TPP would also boost economic activity and stimulate the demand in the TPP economies, which include some of Australia’s most important trading partners.

“The TPP is the most comprehensive trade agreement involving developed and developing countries. It moves beyond just trade in goods. It will strengthen the operating environment for services providers.

“Economies in the region will grow faster as a result. It is good for Australia if Japan, Malaysia and Vietnam and other countries grow. And Australia will benefit, not just from the economic opportunities but because of the building block that the TPP provides towards region-wide economic integration.”

Pearson said a successful agreement would encourage the addition of other Asian trading nations into a broader Free Trade Area of the Asia Pacific.

“Australia has a big stake in this. If the TPP fails, then the basis for a future region-wide trade agreement will probably fall to the Regional Comprehensive Economic Partnership (RCEP) process. I think it is fair to say that the level of ambition and quality of the RCEP is lower than that of the TPP.  And I don’t think it is in Australia’s interests to have a lower quality trade blueprint as the model for closer regional economic integration.”

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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