In April 2017, the Hong Kong government launched a consultation paper to seek comments and suggestions from interested parties on the proposed Free Trade Agreement (FTA) with Australia. Prior to the closing date of the consultation paper, on 16 May 2017, the Secretary for Commerce and Economic Development and the Minister for Trade, Tourism and Investment of Australia announced the official launch of the FTA negotiation between Hong Kong and Australia.
Australia is an important trading partner of Hong Kong. Australia was Hong Kong’s 19th largest goods trading partner in 2016 and 7th largest services trading partner in 2015. The cooperation between the two countries and the trade and economic liberalisation will provide a new platform for enhancing capital flow, innovation, interaction between professionals and R&D collaborations.
It is envisaged that the FTA may include the following key elements:
- elimination or reduction of tariffs for products of Hong Kong origin (the Australia’s average applied tariff rate is 2.5%);
- reduction of non-tariff barriers;
- preferential rules of origin;
- customs facilitation procedures;
- better market access for trade in services;
- promotion and protection of investment;
- intellectual property rights;
- government procurement; and
- legal and institutional arrangements, including a dispute settlement mechanism for the FTA.
In addition to the negotiation with Australia, Hong Kong is also currently negotiating FTAs with Association of Southeast Asian Nations, Georgia and Maldives to expand its commercial and trading networks and create favourable business conditions for Hong Kong enterprises.