Australia-Reviewing Free trade agrement.

AUSTRALIA-FREE TRADE AGREEMENTS. ABC INTERVEIW.

With Australia and South Korea announcing the start of free trade talks in May, Australian red meat producers are urging a quick deal to beat a likely US re-entry into the South Korean market.

The US has been the largest exporter of beef to South Korea, until four years ago. Then mad cow disease was found in the American herd and South Korea banned its beef.

America’s return now depends on ratification of a completed US-South Korea free trade agreement, giving the US much better tariff terms.

Radio Australia’s Canberra correspondent Linda Mottram reports it’s now urgent to secure Australia’s $750-million export market.

LINDA MOTTRAM: For Australian beef producers the announcement this week that Canberra and Seoul will in May start negotiations on a free trade agreement means the race is on to cement their strong foothold in the lucrative South Korean beef market.

DAVID INALL: The South Korean market is critically important for the Australian beef industry. It’s our third largest market. It has recorded significant growth over the past four to five years.

LINDA MOTTRAM: David Inall is executive director of the Cattle Council of Australia, representing the country’s cattle producers, and he’s clear on the impact if US beef gets back into South Korea on preferential terms.

DAVID INALL: The implications for Australia would be quite disastrous in that if we were unable to secure parity of access, similar or exactly the same should I say to the United States, we would still be sweltering under a 40 per cent tariff or maybe something near that while the tariff for US beef heads towards zero.

LINDA MOTTRAM: The urgency the Australian industry now speaks of in the Australia-South Korea free trade negotiations is because although the US has finalised its FTA with Seoul, giving it beef tariff reductions, the two sides have not yet ratified the deal so it’s not in operation.

The Australian meat and livestock industry welcomes the news that the Australia-South Korea negotiations are now starting in earnest and they want a deal on beef done as fast as possible.

Australia’s Trade Minister Simon Crean is very sympathetic to preserve Australia’s strong beef exports to South Korea.

SIMON CREAN: We did that because we had clean product when obviously the BSE scare happened in the US. The US free trade agreement that now gives, opens up access again to US beef into the Korean market is another reason why we have to get this FTA up. We can’t be put at a competitive disadvantage now that we’ve established such a strong toehold. So yes, beef’s one of those key areas of interest.

LINDA MOTTRAM: There’s a lot more than just beef at stake for Australia in a free trade agreement with South Korea. Two way trade overall is already worth $AU23-billion, $18-billion to Australia’s exports.

So the FTA is aimed at lowering a range of tariffs to grow the value of that trade. In bad economic times that’s especially good says Simon Crean.

SIMON CREAN: I think that we need to understand that the relationship between our two countries is not only big in economic terms; it’s diverse. Our challenge is to make it bigger and more diverse.

LINDA MOTTRAM: And Mr Crean says that while South Korea’s focus on the free trade deal with the US has meant it hasn’t been open to starting talks with Australia earlier, now after this week’s visit to Australia of South Korea’s President Lee Myung-bak, the political will has moved matters along.

So the Cattle Council’s David Inall says a deal, where beef is concerned, must be done fast.

DAVID INALL: The minimum we’ll be seeking will be as per the US negotiations and we would like to see our 40 per cent tariff also reduced to zero over a period of time.

LINDA MOTTRAM: It won’t necessarily be easy though, given that trade talks are notoriously labyrinthine and trade-offs are common.

TANYA NOLAN: That’s Radio Australia’s Linda Mottram reporting from Canberra.