1. Australia-Chile Free Trade Agreement
Virginia Greville
Australian Ambassador

2. Launch of negotiations
The negotiations were launched in November 2006, when the then Ministers for Foreign Affairs Truss and Foxley announced the intention to take the first steps towards a wide ranging FTA.
Extensive consultations with industry and bilateral meetings between officials from both countries followed.
In July 2007, the decision was made to begin formal negotiations.

3. Negotiation rounds
The first round was held in Canberra in August 2007.
Draft text was exchanged on all likely FTA chapters at this meeting.
The second round was held in Santiago in mid-October Goods offers were exchanged at this meeting.
The third round was held in December 2007 and January 2008 in Australia.
The fourth and final round was held in Santiago in 2008.
The FTA was signed in July 2008 in Australia, and it entered into force on 6 March 2009.

4. Why Chile matters to Australia
Chile is a stable, successful and open democracy in Latin America.
Chile is our 3rd largest trading partner in the region.
Two-way trade is growing fast ($1.2 billion in 2009).

5. Why Chile matters to Australia
Chile is also a logical stepping stone into the wider Latin American market.
And offers us valuable technology transfers and information sharing.

6. What Chile offers Australia
A strong trading economy.
Growing demand for our energy resources and mining expertise.
The most stable and transparent commercial environment in Latin America.

7. Benefits of an FTA with Chile for Australia
Chile’s tariffs are a flat 6% except on some agricultural products.
The FTA has cut these tariffs further and tackles non-tariff barriers in key areas (mining, mining services and some rural industries).

8. Trade barriers for Australia in Chile
Our goods exports to Chile faced tariffs and non-tariff barriers (eg different technical standards) which restricted trade expansion.

9. Trade barriers for Australia in Chile
Our services industries faced “behind-the-border” barriers in the form of restrictions on commercial presence and licensing requirements.
Our investors faced opaque and burdensome rules and regulations

10. Staying ahead of the pack
56 other countries are covered by preferential trade agreements with Chile, including many of our trade competitors.
Australian industry could have faced a competitive disadvantage because of the preferential treatment secured by Chile’s other FTA partners.

11. Staying ahead of the pack
A high-quality FTA levels the playing field and provides better conditions for Australian investment.
An FTA also supports our efforts to promote more open trade in the Asia Pacific region and a successful conclusion to the Doha Round of global trade negotiations.

12. Australia’s trade with Chile
Over 75 Australian-affiliated companies are operating in Chile (up from only two in 1990).

13. Australia’s trade with Chile
Our major goods exports to Chile include coal, civil engineering equipment, transmission shafts, specialised machinery (total $133m in 2009).

14. Australia’s trade with Chile
Our imports include copper, lead ores and concentrates, pulp and waste paper, fruit prepared or preserved (total $510m in 2009).

15. Australia’s investment in Chile
Australia is the 2nd largest foreign direct investor in Chile ($1.1billion in 2009)
Most of our investment is related to the mining industry, especially mining technology and services.

16. Australia’s investment in Chile
Considerable investment also in Chilean gas distribution and power generation.
Sectors offering investment potential include: renewable energy sector, agribusiness, food and beverages, information technology, tourism, defence technology and education and training.

17. Benefits of the FTA with Australia for Chile
The FTA with Australia can help Chile’s strategy to convert the country into a business and investment platform in the region.
Improve investment relations.
Generate new product processes, new technology use and key supply sources to create new businesses for Chile.

18. The Next Step
The logical partner for an FTA is a Double Taxation Agreement which is of benefit to companies and individuals working/operating in both countries.
Australia and Chile negotiated a Double Taxation Agreement signed in March 2010 and we hope it will take effect from January 2011.

19. Thank you