Though more than 9,000 miles separate Britain and Australia, our shared history has resulted in a deep and enduring bond. From the start, Scots played a vital role in Australian history. The father of modern Australia, Lachlan Macquarie, was born on Ulva and today over 2 million Australians have Scottish ancestry.
I myself have family in Australia who left Scotland in the 1950s to make a new life for themselves and their families. Recently, the oil and gas sector in the northeast of Scotland has developed links with the energy industry in Australasia. These longstanding ties underpin the friendship of two nations that are global champions of free trade.
With our shared bonds and similar economies Australia represents one of the first of a new generation of trade deals that will set the standard for what an Free Trade Agreement (FTA) could look like internationally. These include forward leaning provisions in digital and data that will give tech firms in Silicon Glen greater access to the Australian market.
Scotland’s thriving financial service providers, in particular in and around Edinburgh, will benefit from the digital services chapter and investment provisions. Meanwhile the removal of regulatory barriers in Fintech and space sectors will facilitate our proposed ‘space bridges’.
A deal with Australia commands popular support with an overwhelming majority of voters, not only supporting a deal with Australia but also, putting it at the top of their list of new trading partners (second only to Canada). But this is not just a resumption of an old friendship. Australia is a key partner, and government analysis shows that Scotland is expected to be one of the biggest beneficiaries of an ambitious deal.
Scottish businesses are already selling to Australian consumers, with £352 million of goods exported including 20 million bottles of whisky, worth over £100 million. Yet these figures are only the tip of the iceberg. An ambitious trade deal will give our pioneering businesses the opportunity to export even more, driving post-Covid growth across all parts of the United Kingdom.
A key aim of a free trade agreement is tariff free access for all UK goods – worth £4.5 billion – to Australia, including in food and drink, benefiting whisky exporters who will see the 5 per cent tariff disappear and for whom Australia is a major market.
And while we sell whisky to Australia we also want to help consumers by removing tariffs on iconic Australian products, such as wine. A successful deal means a bottle of Jacob’s Creek will be cheaper at the check-out. As a gateway to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the prospects for Scotland’s food and drink sectors are huge.
In our negotiations we will not only champion iconic and innovative sectors, such as food and drink and digital industries. Our world class negotiators will be putting those small businesses that want to start, or grow, exporting to Australia front and centre. Our trade agreement will have a dedicated small and medium-sized enterprises chapter to help the UK’s 5.9 million small businesses.
Australia strongly supports UK membership of the CPTPP — an 11 nation, £9 trillion free trade area. With Scottish firms already exporting over £2.4 billion of goods to CPTPP nations, membership will further open up these key pacific markets.
From established businesses to ambitious start-ups, CPTPP membership will benefit Scottish companies of all shapes and sizes. Over the next few years around half of small businesses see CPTPP nations, including Australia, as priority markets for future growth.
With changing dietary preferences in the UK, such as the rise of veganism, Asia, which is expected to have 66 per cent of the world’s middle-class consumers by the end of the decade, provides great opportunities for Scottish beef farmers.
Increased trade does not mean decreased security. By striking deals with like-minded democracies, we can increase the resilience of our supply chains and the security of the economy. We know that companies that trade overseas are more productive, increasing this number can help boost wages and jobs.
We will not sign a trade deal at any price. The NHS, the price it pays for drugs and its services are not on the table and British farmers will continue to thrive. Beef production in Australia is already at capacity — they have no excess to sell to Britain and have existing markets for their produce.
A deal will not mean a flood of cheap imports. More than 80 per cent of Australian beef exports are to Asia, where beef prices are higher than the UK. And our new trade and agriculture commission, made up of independent experts, will have the ability to review a deal and ensure it delivers for Scottish farmers.
We work best as a Union when we embrace our role as a great trading nation. In doing a far-reaching deal with Australia, we in Britain can embrace its destiny and once more head out and into the world.
Article for The Times Red Box, May 2021