The free trade agreement signed by Australia and South Korea will not only benefit Australian primary producers but also others including South Korean car makers.
As the ABC reports, the Australia Korea Free Trade Agreement (KAFTA) was signed at a meeting in Seoul yesterday.
The deal follows the decisions by all auto makers to cease Australian-based manufacturing operations in coming years. As Xinhua points out, it will help South Korean car makers compete in the Australian market against other Asian rivals with lower labour costs.
South Korean companies such as Hyundai Motor and Kia Motors will benefit from a 5 percent tariff on cars imported into Australia within three years after the FTA implementation.
In addition, import tariffs on gasoline-powered South Korean cars with an engine capacity of less than 3 litres will be immediately lifted when KAFTA is implemented.
On the plus side from the Australian point of view, South Korea will cut tariffs ranging from 15 per cent to 500 per cent on Australian exports such as beef, wheat, sugar, dairy, wine, seafood, resources and manufactured goods.
In addition, Australia will find new market opportunities in education, telecommunications, financial services, accounting and legal services.
Announcing the deal, Prime Minister Tony Abbott said, "Economically, there is huge untapped potential in the relationship between the two countries."
"The free trade agreement that we signed today is the first free trade agreement of your government, it is the first free trade agreement of my government and I believe it is one that we can both be very proud of.
"I am confident … that over time, Australia can help to deliver food security, resource security and energy security to the people of Korea."