By Paul Schroder King and Wood Mallesons’ Sydney office
On November 17, 2014 China signed a declaration of intent with Australia concluding the first stage of bilateral negotiations on a free trade agreement (ChAFTA). Australia will reduce the tariffs on all Chinese products to zero eventually and China will reduce the tariffs on most of Australian products to zero. In the services sector, both sides promised to open their markets to each other’s service providers in a meaningful way. In the investment field, although the details have not yet been released, MOFCOM announced that both sides have agreed to grant each other “most favored nation status”.
They also agreed to significantly reduce the review thresholds for corporate investment, to increase market access opportunities, and improve the predictability and transparency for investment. The agreement will cover more than 10 areas, including trade in goods and services, investment and trade rules. It will also cover subjects such as e-commerce and government procurement. According to MOFCOM
“The China-Australia FTA negotiations have realized the goal of comprehensiveness, high quality and balance of interests. The signing of the agreement will allow the two countries to fully utilize their respective economic advantages, boost win-win cooperation, bring mutual benefits and promote the in-depth development of bilateral economic and trade ties.”
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