The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will enter into force for Chile on 21 February 2023. As we reported in November last year, the CPTPP entered into force for Australia, Canada, Japan, New Zealand, Mexico and Singapore on 30 December 2018, Vietnam on 14 January 2019, Peru on 19 September 2021 and Malaysia November 2022.
This only left Chile and Brunei Darussalam, with the latter still waiting for the CPTPP to into force.
This week the Australian Border Force (ABF) has issued Australian Customs Notice No. 2023/04: “Customs (Comprehensive and Progressive Agreement for Trans-Pacific Partnership – Entry into Force for Chile) Notice 2023.”
The ABF advises that following Preference Origin Country code is to be included with the table found in ACN 2018/37 for use from 21 February 2023:
Preference Origin Country Code: CL
Description: Chile.
Chile is home to over 200 Australian companies, by far the largest Australian presence in Latin America. The Australia-Chile Free Trade Agreement entered into force on 06 March 2009. It was Australia’s fifth FTA and the first with a Latin American country. The FTA covers goods, services and investment. From 01 January 2015, all tariffs were eliminated except sugar, which retains a tariff of 6% for Australian exports.
The trade relationship between Australia and Chile has been dominated by the Mining and METS (mining equipment, technology and services) sector, however in recent years, this interest has diversified and now includes agriculture, genetics trade, food, infrastructure development, health, transport and logistics. Australia’s main exports to Chile are coal and civil engineering equipment; trade from Chile is largely in copper and pulp and waste paper.
Chilean authorities indicate that prior to ratification they were able to sign side letters with Mexico and New Zealand, as well as a declaration with Canada that includes a commitment to work on a revision of the CPTPP investment chapter. Chilean authorities hope to sign a similar declaration with Australia.
Meanwhile the UK is working to become the first European member of the bloc this year with negotiations progressing well for their accession to CPTPP. UK accession could mean more than 99% of UK exports to member countries become eligible for tariff-free trade.
Chile was the first country to sign a trade deal with the UK after they left the EU which secured preferential access to each other’s markets. The UK sees Chile as one of the foremost champions of free and open trade in the Pacific region.
Also of interest is Uruguay’s recent filing of an application to accede to the CPTPP, joining the United Kingdom, mainland China, Taiwan, Ecuador and Costa Rica. Other economies that have expressed interest in joining the pact include Colombia, South Korea, Indonesia, Thailand and the Philippines. Certain groups are also trying to revive interest in the United States to recommit to an agreement that it originally spearheaded.
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