Bigger market opportunities are going to open for Victorian producers as a new trade agreement takes full effect between Australia and Malaysia.
On Tuesday, Agriculture and Food Security Minister Peter Walsh discussed the Malaysia Australia Free Trade Agreement (MAFTA), a bilateral accord that promises to provide Victorian producers with significant export markets for their products. The sector that will benefit most in the agreement is dairy, as well as other non-food related industries.
Mr. Walsh is currently in Kuala Lumpur for the South East Asia visit of the Victorian Super Trade Mission.
"The continuing reduction in trade barriers like the MAFTA will assist Victoria's food and fibre producers to find more consumer markets for their produce," Mr. Walsh said.
The MAFTA, signed on January 1 this year, will help the Victorian Coalition Government in its goal to double its food production by 2030, according to the AFS minister.
Malaysia: A Viable Market
At present, Malaysia is rapidly growing in terms of population and economic output. A notable increase is seen in the number of families joining the middle class. As such, there is a consequent demand for high quality and dependable food imports. According to Mr. Walsh, this is where Victoria comes in to fill the void.
He underscored as well the impact of the agreement in answering the challenges faced by Victorian producers. He said that by removing the tariffs on agricultural products shipped to Malaysia, Victoria has a greater chance to be more competitive and increase its amount of product exports.
Mr. Walsh particularly talked about the potential growth and gains in the dairy industry of Victoria.
He said that the demand for dairy products in Malaysia is experiencing a growth rate of 10 to 15 percent annually. Malaysia can only supply five percent of its total domestic demand.
"Malaysia's growth rate is in excess of what the country can supply domestically, so Victoria can assist the country by helping to fill that gap with quality produce," Mr. Walsh said.
At present, Victoria is exporting around 13,621 tonnes of dairy to Malaysia, according to Mr. Walsh. This number represents around 12 percent of the total amount of dairy products that Malaysia imports.
"Malaysia recognise Australia's dairy products are extremely high-quality, safe and reliable imports. The removal of these tariffs will allow us to capitalise on this reputation," Mr. Walsh concluded.