Last night, the trade minister announced the beginning of formal negotiations for an Australia-UK Free Trade Agreement (FTA). This is likely to have ramifications for UK nationals travelling to Australia when coronavirus travel restrictions are lifted such as international trade obligations (ITOs) exempting the need for labour market testing for Subclass 482 – Temporary Skill Shortage visas and potentially the lifting of the age cap for Subclass 417 – Working Holiday visas from 30 to 35 years of age as well. The trade minister also confirmed borders will continue to be closed to international visitors, with a likely date to reopen sometime in 2021.

Australia-UK Free Trade Agreement negotiations commence

Australia’s push for free trade agreements, either bilaterally or multilaterally, has always been an ideological backbone of the government to boost the prosperity and living conditions of all Australians. Where the coronavirus pandemic has echoed whispers of protectionism of at least a rethink of global supply chains, the government has been forging ahead with its open international trade agenda. They have, however, recently tempered this with revisions to rules for foreign investment where national security is an issue.

Australia’s historical roots with the UK needs no introduction, although trade has taken a back seat in recent times as the UK is Australia’s seventh-largest trading partner. Why there has not been an FTA is due to UK’s ties to the European Union. Now that Brexit has officially happened with an implementation period on trade to work out the finer details, the UK has been scrambling for trade agreements as they emerge from an economic coupling with the EU.

Since the coronavirus pandemic, the UK’s economy has been hit extremely hard: Gross Domestic Product fell by an unprecedented 20 per cent in April 2020. In the interests of post-COVID-19 economic prosperity, if not survival, an Australia-UK FTA could provide mutual benefits to both countries, and is a likely source for accelerating into formal negotiations, as much groundwork and courtship would have been done prior to last night’s announcement.

Along with increased trade in goods and services, benefits are likely to include travelling citizens. No doubt, once the FTA is in force, an ITO is likely to exist which will exempt firms sponsoring UK citizens on 482 visas from labour market testing, as is the case with Australia’s other FTAs. There may be additional cultural benefits for UK citizens, and while no confirmation has been made, it is possible that closer ties might involve the lifting of the age cap for UK citizens from no less than 30 to 35 years of age. It would be strange if this is not the case as the 35-year age cap is in place for Canada, France, and Ireland, for which the latter two do not have FTAs, and if reports of enabling more people to travel between each country for work is true, this change is likely to be considered.

The Department of Foreign Affairs and Trade’s (DFAT’s) website lists the numerous FTAs Australia has signed, those in force or not yet in force, and FTAs are under negotiation. Prospective FTAs include:

• The European Union;

• India;

• The Gulf Cooperation Council: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates;

• The Pacific Alliance: Chile, Colombia, Mexico and Peru;

• The Regional Comprehensive Economic Partnership: Brunei Darussalam, Cambodia, China, India, Indonesia, Japan, the Republic of Korea, Lao PDR, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand and Vietnam; and

• Trade in Services: Various WTO member countries.

International visitors likely in 2021

Additionally the trade minister in a press conferences today, flagged that Australia’s borders are likely to remain closed to international visitors until 2021.

His express reference for “holiday purposes” means that there may be scope for other visitors to return sooner and who have so far been left out in the cold: stranded international workers who missed the border closure deadline, and other temporary visa holders who are not tourists.