Andina

Peru: FTA with Australia serves to achieve US$8 billion in agro-exports

00:00 | Lima, Feb. 12.

The recent entry into force of the Peru-Australia Free Trade Agreement (PAFTA) will contribute to meeting the goal of achieving US$8 billion in agro-exports by the end of 2020, the Peruvian Agriculture and Irrigation Ministry (Minagri) has projected.

The Ministry said this agreement will allow almost 100% of Peruvian agricultural products to enter the Oceanic country without paying tariffs.

In this sense, Minister Jorge Montenegro pointed out that the goal of achieving the US$8 billion goal in food exports to the world is the step prior to 
reaching the projected US$10 billion during the country's Independence Bicentennial (2021).

The PAFTA allows 96% of the Peruvian exports supply to enter the Oceanic nation tariff-free. In the case of agricultural products, the rate reaches nearly 100%.

On the other hand, 93.3% of Australian products will enter Peru under the same conditions.

Likewise, the PAFTA will allow the South American country to take advantage of new commercial opportunities and ensure that sanitary and phytosanitary procedures are transparent and efficient. At the same time, the movement of Peruvian technicians and professionals to Australia will be favored.

Small producers

Unlike other trade agreements, the PAFTA seeks the increasing incorporation of small producers in the promotion of bilateral trade.

"Proof of this is that for the first time a chapter on Small/Medium-sized Enterprises (SMEs) as well as on Competitiveness and Business Facilitation is included, which contributes to the development of the country," it emphasized.

Minagri also stressed that the main agricultural export products —which will enter Australia tariff-free— are coffee, quinoa, canned asparagus, cacao beans, cacao powder, chocolate bars, maca flour, carmine cochineal, fresh garlic, and frozen mangoes.

Trade

Last year, Peruvian exports to Australia totaled US$91.6 million, a 56.6% decrease compared to 2018. This situation is expected to improve substantially following the PAFTA's recent entry into force.

Background

The FTA was signed on February 12, 2018, in Canberra (Australia) and 
ratified by the Peruvian side on February 22, 2019.

It established that 96% of Inca products would enter the Australian market tariff-free from the first day in force, whereas the remaining 4% would do so in a gradual process over a maximum period of four years.

(END) MDV/MVB

Published: 2/12/2020