China Australia Trade Deal To Be Announced Next Week

Australia and China are widely expected to announce a free trade agreement (FTA) in the next week on or before Monday, when the Chinese president, Xi Jinping, addresses parliament in Canberra.

If it comes off, it will mean the Abbott government has completed bilateral agreements with China, Korea and Japan in one year, albeit finishing deals started by previous governments.

While the FTA has been nearly 10 years in the making – negotiations began in 2005 – Tony Abbott showed his hand after he came to government by declaring that he wanted the negotiations done within the year.

Labor’s trade spokeswoman, Penny Wong, the Greens and others, such as Australian Industry Group’s Innes Willox, have urged the government not to rush into a deal for the sake of a self-imposed deadline. Willox has said the AIG welcomes a good deal, not just “any deal”.

Wong used another house metaphor to get the point across: “If you’re going to sell your house … and you tell the market that you want to sell it in a year, that isn’t the best negotiating position.”

Negotiators, particularly in the agricultural sector, have been looking closely at the 2008 China New Zealand trade agreement, which is considered the basis for any free trade agreement. It provided big wins for New Zealand dairy, for example, with a more than tenfold increase in exports to China.

via The Guardian

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza