Chair of the industry’s IA-CEPA taskforce David Foote said that Indonesia was a “vitally important customer” for significant quantities of Australian live cattle, beef and offal and had a steady requirement for sheep meat, albeit smaller volumes.
“IA-CEPA will not only deliver additional trade liberalisation by building on the ASEAN-Australia-New Zealand FTA (AANZFTA) outcomes, it will also provide a framework for a more market-orientated import regime. This, in turn, will deliver benefits for both our sector as well as the Indonesian supply chain – including importers, retailers and foodservice operators,” he said.
“IA-CEPA is a most welcome addition to the suite of FTAs the Australian Government has concluded to date with key trading partners.”
The IA-CEPA Taskforce includes representatives from every major meat and livestock trade body in Australia.
When enacted, the IA-CEPA will deliver a quota (with a 0% in-quota tariff) for 575,000 head of live (male) cattle, which will grow by 4% per annum over five years to 700,000 head. Import permits will be issued automatically on an annual basis and without seasonal restrictions. A review of this trade will be conducted after five years to consider future increases in the quota (i.e. above 700,000 head).
There will also be liberalised access for female live cattle exported to Indonesia, with a 0% tariff on entry into force of the agreement and no quota or import permit restrictions, as well as immediate or gradual liberalisation of tariffs applicable to boxed beef and sheep meat exports to Indonesia. Those tariff lines not already benefiting from 0% tariffs secured under AANZFTA, will benefit from either a 0% or 2.5% tariff on EIF, with the tariffs being eliminated altogether over five years.
“In an increasingly competitive market, whereby Indonesia is granting access to numerous beef suppliers, a removal of these import tariffs will assist in maintaining Australian products’ cost competitiveness,” added Foote.
He said that the conclusion of the negotiations was just the “beginning of cementing the close relationship” between the two countries.
“Shoring-up the trade relationship via IA-CEPA will be jointly beneficial – but importantly this will need to be matched by ongoing close dialogue coupled with effective industry and government partnership initiatives as we continue to navigate a rapidly changing global trading environment,” he said. “Indonesia has an ongoing requirement for imported red meat (specifically beef) and, whether via the supply of live cattle or boxed product, our industry is ideally placed to assist Indonesia with meeting this demand.”