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Supply Chain

UK trade deal with Australia aims to increase supply chain resiliency

James McLoughlinBy James McLoughlin1st June 20232 Mins Read
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A new free trade agreement (FTA) between the UK and Australia has come into action from this morning [1 June], removing ‘most’ tariffs on trade between the two nations.

One of the ‘high-level objectives’ of the FTA listed by the House of Commons is to “increase the resilience” of the UK’s supply chains by diversifying trade.

In a statement, the Department for International Trade (DIT) said: “Pivoting towards the Asia Pacific will help diversify our trade, make our supply chains more resilient, and make the UK less vulnerable to political and economic shocks in certain parts of the world.”

In light of the disruption to global supply chains caused by the pandemic and Russia’s war on Ukraine, the need for enhanced supply chain resilience has become very apparent. This was highlighted by G7 leaders at the 49th G7 Summit, held from 19-21 May 2023 in Hiroshima. For more details on this, look out for the June issue of Logistics Manager next week.

When the FTA with Australia was agreed in June 2021, then Secretary of State for International Trade Liz Truss said: “The agreement paves the way for us to join the Trans-Pacific Partnership, a £9 trillion free trade area home to some of the biggest consumer markets of the present and future.”

§At the point where the FTA has come into effect, the UK has concluded negotiations to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) – as of 31 March 2023. The final legal administrative steps are currently taking place for the UK to formally join the partnership. Current members of the CPTPP are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam.

Another objective set out by the House of Commons is to “future-proof the agreement in line with the government’s ambition on climate”.

Chapter 22 of the FTA between the UK and Australia is dedicated to the environment, with the memorandum accompanying the agreement explaining that it ensures that “neither party can derogate from, waive, or fail to domestically enforce environmental laws to create an unfair competitive advantage”.

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James McLoughlin is a Journalism graduate from the University of Leeds and Senior Reporter for Logistics Manager. James is interested in all aspects of the supply chain. In his spare time, James is a big football fan and a music lover.

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