Boris Johnson is pushing for a zero-tariff trade deal with Australia in the next month after over-ruling the concerns of his environment secretary.
The prime minister met ministers yesterday to discuss the prospects of a deal. He is understood to have sided with Liz Truss, the trade secretary, over George Eustice.
The deal will give Australian food exporters the same terms as those enjoyed by the EU. In an effort to address concerns, there will be a transition period of between 10 and 15 years before the zero-tariff regime is enacted.
The plan is being resisted by farming groups, who have warned that it would set a dangerous precedent for trade deals and could result in British farmers struggling to compete with cheap imports. The groups have been backed by Eustice and Michael Gove, the Cabinet Office minister, who has privately expressed reservations.
Johnson, however, is understood to be convinced that the deal will present significant opportunities for Britain and British farmers. He hopes that a deal in principle can be ready in time for the G7 summit in Cornwall next month.
Johnson is understood to be pushing for a zero-tariff, zero-quota deal with Australia. After the discussions yesterday a government source said: “Johnson made clear he was with Liz on this, it was much more positive for her.”
Another source confirmed that Johnson had sided with Truss and wanted an “ambitious” agreement. Truss is due to speak to her Australian counterpart, Dan Tehan, today.
Johnson himself is understood to have spoken to Scott Morrison, the Australian prime minister, last Friday. One source said that Morrison had offered the UK complete tariff-free and quota-free access to Australian markets if it was done on a reciprocal basis.
“The offer was to do the same deal as the UK has done with the EU,” the source said. “But they’re not prepared to accept quotas. If that’s what is on offer they’ll walk away.”
The Australian Agriculture Company, the country’s biggest beef exporter, has predicted that the trade deal could lead to a tenfold increase in its exports to the UK. Hugh Killen, the organisation’s chief executive, told the Financial Times: “In the event of a free trade deal that removes tariffs and quotas we could see [Australian beef] exports double or triple. In fact, given exports are so small now, it’s possible they could even increase tenfold.” Truss is expected to hold regular talks with her Australian counterpart in a “sprint” to reach a deal.
Johnson used an appearance before the 1922 Committee of Tory MPs this week to exhort the benefits of free trade, declaring: “We’re the party of Peel.” Sir Robert Peel broke with Tory protectionism by repealing the corn laws in 1846, sacrificing his premiership to usher in an era of free trade.
Asked about the prospect that Welsh lamb farmers could be priced out of the market by competitors from Australia and New Zealand, Johnson said the government had built “huge opportunities for our farmers and livestock”.