Australian Trade Minister, Warren Truss during a meeting with a Chinese group in Sydney, announced that talks on the contentious issue of opening market for goods and services would begin in December bringing them a step closer to Free Trade Agreement (FTA).
Even though China said that it was committed to finish the negotiations within two years, it looked certain that it would not give too many concessions.
Truss said that both sides would discuss detailed information on tariff proposals and will also exchange the list of hurdles both sides will be expecting the other to take care of.
The negotiations are expected to a bumpy ride with Chinese Commerce Minister, Bo Xilai regarded as a tough negotiator. Xilai even though said that both economies were complimentary, hinted quite clearly that their national conditions were quite different.
China has 200 million farmers living below poverty line and feels that it has already given away a lot on farm protection issue. It is also worried that giving concession to Australia will encourage other countries like US to ask for the same leverages.
Xilai has asked for a high level agreement under FTA that includes the complete removal of agricultural tariff from Australian side while the scene could be totally different when it comes to sectors like textile and garments, manufacturing sectors where China has dominance.
Bo Xilai has made it clear that China is not prepared to concede much for Australian manufacturing sector. Even though both sides showed optimistic attitude it is quite clear that the road ahead is very bumpy and uncertain.
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