Going global, Australia continuously improves its relationship with the region of Latin America, seeking new opportunities to strengthen their ties. Because of this objective, Australia has welcomed new ideas to express diplomacy and foreign collaboration.
Working and promoting this, both have successfully created new opportunities for their people, in all different aspects—from education to business to culture. And now, they have established a relationship that keeps on expressing the concept of alliance and development.
PAFTA or Peru-Australian Free Trade Agreement is just one of the actions made by two parties to strengthen their ties, and further their economic standing by doing a foreign collaboration. Because of this agreement, a bilateral relation between Peru and Australia has been sealed.
Last 12th of February 2018, Australia welcomed Peru to sign this agreement. It didn’t translate to political or news headlines, but PAFTA is a statement of development for Australia to strengthen their economic and cultural ties to the region of Latin America. It is a symbolic move by Australian foreign policy-makers to break indifference and nurture globalization.
Commitment to this agreement means that Australia’s expression of gravitas towards expanding its foreign relation with Latin America. It is also a recognition of Latin American countries as an economic powerhouse in the Pacific.
What is PAFTA?
Announced by Prime Minister Malcolm Turnbull in Vietnam during the 2017 Asia-Pacific Economic Cooperation Summit, the Peru-Australian Free Trade Agreement became a gateway to an influx of goods and services from Peru, increasing trade and diversity. As Prime Minister Malcolm Turnbull said, “The region cannot close the door to the flow of goods, services, capital, and ideas.”
PAFTA has increased the apparent and promising trade between the two nations back in 2016, which totaled AUD$ 590 million. The agreement aims to increase this and create new opportunities for both regions. Some of the highlights of this agreement are:
- Opening the Peruvian markets to Australian agriculture, specifically, the dairy farmers.
- Removal of duty on Australian products (wine, wheat, pharmaceuticals, and medical technology).
- Within five years of the agreement, Peru will eliminate up to 17 percent worth of tariffs on Australian beef.
- Strengthening educational ties, with the recognition of Australia degrees in Peru.
What does it mean to Peru and Australia?
PAFTA carries its significance for both nations. It gives new milestones and strengthens their individual economic standing.
Peru is given a chance to explore one of the most important markets in the Asia-Pacific, accessing the Peruvian agro-exporter output to Australian markets. Meanwhile, Australia’s partnership with Peru means expansion. With Peru’s economic stability and gradual assured growth, the country is an ideal partner to make trade pacts. It is an opportunity for both nations to capitalize on new goods, services, and markets. This bilateral relation, strengthened by PAFTA, means new opportunities and new economic milestones.