Tariffs slashed on exports to Peru

Peru is one of Latin America’s fastest growing economies, and an opportunity for Australia’s agriculture thanks to the Free Trade Agreement between the two countries.

In February 2020, the Peru-Australia Free Trade Agreement (PAFTA) entered into force, beginning the process of phasing out tariffs and boosting Australia’s agricultural competitiveness in the South American nation.

The nation of over 32 million people is the 4th most populous in South America, and a promising market for Australia’s agriculture. The trade of agricultural products between Peru and Australia was valued at $108 million in 2018-19.

Head of bilateral trade in the Americas, Matt Worrell, said that the agreement will slash tariffs across a wide range of Australia’s goods, allowing Australian farmers and exporters to enter a level playing field against competitors in the market.

“The US, Europe and Canada all have deals with Peru, and now we’ll be able to compete at the same level. This will give our world-class food products the best chance to get on Peruvian supermarket shelves and dinner tables,” Worrell said.

Tariffs on seafood, sheep meat, kangaroo, most horticulture products and wheat were immediately lifted at the commencement of the FTA, as were some tariffs on wine and pork. Tariffs on beef and many more on wine will be phased out over the next 5 years.

“Overall, 99.4 per cent of tariffs on Australian goods exported to Peru will be abolished by 2025,” Worrell said.

“We’ve also negotiated for preferential quotas on sugar, dairy, rice and sorghum. These quotas will increase over time, which is a win for those industries.

“Peru has been one of the fastest growing economies in Latin America, and at times the world, over the last decade. The agreement heralds a great opportunity for Australia’s agriculture to stake a claim of that strengthening market.”