SYDNEY – Nov 13 (Reuters) – Chinese President Xi Jinping’s upcoming visit to the remote island state of Tasmania underscores Australia’s push to ramp up agricultural exports, with the two countries on the verge of signing a free trade agreement.
Australia is attempting to transition from a reliance on exports of minerals such as coal and iron ore to expanding its food and agricultural exports to a growing Asian middle class, moving from a “mining boom” to a “dining boom”.
A free trade agreement with China would be a huge boost for that aim and Tasmania, the only Australian state with a ban on genetically modified food crops and animal feed, is at the heart of the country’s high-end production.
China is already Australia’s largest trading partner, with two-way trade of about $150 billion in 2013. But China has been concerned about opening its markets to Australian food and unhappy with strict Australian limits on investment by China’s state-owned enterprises.
In Australia, meanwhile, ownership of farmland by foreign investors is a sensitive issue, but Prime Minister Tony Abbott has made reaching an agreement with China a priority.
Expectations are high that a deal will be announced after Xi’s visit for the Group of 20 summit in Brisbane.
Xi will follow his Australian state visit with a trip to New Zealand, which already has a free trade agreement with China, benefiting from phased out tariffs in its key dairy industry.
On the eve of Xi’s visit, Australian officials said a separate deal was almost agreed for Australia to eventually export up to 1 million head of cattle a year to China, worth about A$1 billion ($856 million), to help meet a growing appetite for red meat.
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