A number of specific industries are expected to benefit from the deal, signed in Seoul yesterday, with the cosmetics and personal care industry singled out as being one amongst a range of other categories in both the agricultural and industrial sectors.
The deal was signed between the Australian minister for trade and investment, Andrew Robb, and his Korean counterpart, Yoon Sang-jick, and has been formalised as the Korea-Australia Fair Trade Agreement (KAFTA).
The deal is the culmination of five years of negotiations to make trading between the two countries both simpler and less costly, with the aim of helping to grow the volume of trade and ultimately benefit the economies of both countries.
More exports = more jobs
“The Government’s swift conclusion of these historic agreements sends a strong signal that Australia is indeed open for business,” said Robb during the signing in Seoul.
“With one in five Australian jobs linked to trade, these agreements are good for the economy, good for growth and good for job creation.”
The deal will see the tariffs removed on the majority of traded goods between the two countries over the course of the next 10 years, helping to further promote a trade between the two countries that is currently estimated to have almost doubled in the past five years, reaching a value of AUD300 million in 2013.
Both countries eye increased trading opportunities
Australia hopes to create a total of approximately 15,000 jobs between 2015 and 2030 in the wake of the agreement, with the addition of a further AUD650m in annual trade for the country’s economy.
Both countries have also stated that the FTA will also focus on reducing regulatory barriers and other red tape that has previously handicapped trading between South Korea and Australia.
The country is looking to derive much of that increased in the agricultural sector, which in the cosmetics category is likely to translate into growth in exports of natural cosmetics ingredients and raw materials, including tea tree oil, guar gum, jojoba, manuka honey and spruce hemlock oil.
Although South Korea is mainly expected to tap into the trade deal by increasing its footprint in the Australian automotive industry, both countries will be looking to increase trade in manufactured cosmetic and personal care products, an industry that is seeing high levels of growth in both countries.