An Australia-UK trade agreement is currently being discussed with a view to it become active once the UK leaves the EU. While the UK remains a member of the European Union it is unable to legally sign trade deals with any non-EU country. It will take at least 2.5 years to leave, although the preliminaries can be completed meantime.
According to Steve Ciobo, Australia’s Minister of Trade, the two countries have a strong historical bond and the two countries should be able to come to an agreement ‘quite quickly’. Australia is part of the British Commonwealth with which the UK had strong trade associations prior to joining the EU in 1973.
To complicate matters, Australia is currently discussing an agreement with the EU. These talks are more advanced than those with the UK alone. Mr. Ciobo stated on a BBC Today program that there had been a ‘good alignment’ between the two countries, but that an Australia-UK trade deal could only occur when ‘the time is right’ – a possible allusion to the situation between the UK and the EU.
The UK has no plans to trigger Article 50 of the Lisbon Treaty until next year at the earliest. Article 50 must be activated before the EU and UK can begin negotiations on the terms of the split. Only Britain can activate this. In that respect, the timing of any trade agreement between the two countries will be determined by the UK. However, preliminary discussions can still get under way.
The Article 50 process takes two years to complete, so nothing can be finalized for at least two years after it has been triggered. Meantime, Australia is well into its deal with the EU. Notwithstanding this, the two countries will continue to meet twice yearly in order to have some form of unofficial agreement set up ready for when the UK is finally no longer an EU member.
A working group has been set up for this, and the first meeting in Australia will be in January. Its remit will be to draw up an agenda so the countries will be ready to discuss a free trade agreement when the time comes. This discussion can only begin once the UK has completed negotiations with the EU to leave.
Australian Prime Minister Malcolm Turnbull stated at the G20 summit in China that he wants an early deal struck once the UK has left the EU. An Australia-UK trade agreement will go a long way towards cementing the relationship the two countries had prior to 1973.
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