Global expansion: 10 easy markets to ship to from Australia

If you are a business owner in Australia who wishes to reach the global market, a basic understanding of trade barriers like tariffs lets you decide on which countries are the most impactful trading playgrounds.

International trade results in better economic growth for any country. It also increases competition in the local market while providing local businesses with the opportunity to export their goods abroad. In 2020, there were 56,274 exporters in Australia, with the overall value of merchandise exports hitting a new high of AU$382 billion. With exports believed to recover this year, we can foresee a fruitful future of global expansion for many local businesses.

Typically, markets with the lowest trade barriers let businesses make the most out of their expansion, allowing them to grow their business like never before. But, what are these?

What are tariffs and trade barriers?

A tariff is a tax imposed by a country borne in costs by the domestic consumers of imported goods. During international trading, tariffs are a trade barrier along with quotas, licences, fair trade laws, local content requirements, exchange controls, and standardisation. They are usually imposed by countries that want to protect domestic employment and consumers, provide better opportunities for growth to infant industries, and as a way to sanction countries that violate trade rules.

Tariffs can obstruct international trade and increase prices for consumers. However, to make global trade smoother and more profitable, many countries have established Free Trade Agreements (FTAs) to reduce tariffs and introduce other mutually beneficial measures to support business and economic growth.

10 countries with the lowest trade barriers

According to Australia’s FTAs, various countries have lowered or removed trade and investment barriers like tariffs, creating better opportunities for local businesses to reach markets globally. These are the top 10 markets to consider if you have your eyes set on global expansion and need a competitive edge.

1. United States

According to the Australia-United States Free Trade Agreement (AUSFTA), which came into effect in January 2005, Australian exporters have a better opportunity to export their products to the economic powerhouse of the world and, as a result, reach the global market more efficiently. When the FTA came into effect, about 97% of non-agricultural products exported to the US turned duty-free, quoted the Department of Foreign Affairs and Trade. And more than half of agricultural tariff lines were reduced to zero. Today, about 96% of Australian exports to the US are tariff-free.

2. United Kingdom

Australia recently signed the Australia-UK Free Trade Agreement (A-UKFTA), which will help strengthen trading between both countries, especially after the economic slump of COVID-19. The free trade agreement between Australia and the United Kingdom promotes stronger two-way trade in products and services by cutting tariffs on over 99% of Australian exports, among other commitments.

3. Singapore

Under the Singapore-Australia Free Trade Agreement (SAFTA), which came into effect in July 2003, Australian exporters enjoy greater prospects in goods and services with total elimination of tariffs upon entry.

4. New Zealand

The Australia New Zealand Closer Economic Agreement (ANZCERTA) is one of the world’s most successful trade agreements, which has resulted in Australia being the largest investor in New Zealand. The FTA strengthens Australia's significant connection with New Zealand and fosters deeper economic ties between the two countries through a mutually advantageous extension of free trade. More notably, the removal of tariffs and quantitative export and import restrictions and the minimisation of market distortions in trade help foster profitable commerce activity between the two countries amid fair competition environments.

5. Malaysia

The FTA between Malaysia and Australia, namely Malaysia-Australia Free Trade Agreement (MAFTA), opens new horizons for local exporters in different niches such as automotive, processed foods, milk, plastics, steel, rice, and many other manufactured goods. MAFTA facilitates access to the Malaysian market for Australian goods exporters with elimination of tariffs on 99% of Australian goods. Industries that will benefit include automotives, wine, processed foods and rice, among others.

6. Japan

Another country with the lowest trade barriers is Japan, where the Japan-Australia Economic Partnership Agreement (JAEPA) provides businesses ample opportunities for growth and global expansion. The FTA offers preferential access or duty-free rates to 98% of Australia’s merchandise exports to Japan. For agricultural exports, local businesses exporting wines, milk, high polarity raw sugar, milk protein concentrates and certain types of seafood, among other products can enjoy zero tariffs.

7. China

China is Australia’s biggest trading partner, and the China-Australia Free Trade Agreement (ChAFTA) presents enormous opportunities for Australian businesses to further expand their global reach. The FTA makes exporting to China easier with eliminated tariffs on Australian barley and sorghum, and reduced rates on wool and wine. Gradual cuts will be applied to other agricultural exports like dairy and beef.

8. Thailand

Under the Thailand-Australia Free Trade Agreement (TAFTA) of 2005, 94% of Thailand's tariffs and quota barriers on Australian imports were removed, which amounted to over 80% of Australian exports to the Southeast Asian country, making Thailand a lucrative market to sell to.

9. Korea

Under the Korea-Australia Free Trade Agreement (KAFTA) of 2014, Australian businesses have enormous export opportunities, especially in food and beverages. If you’re exporting to Korea, you can enjoy up to a 300% cut in tariffs on several agricultural exports including beef, dairy, seafood and wheat. Tariffs on manufactured goods have also been eliminated.

10. Chile

The Australia-Chile Free Trade Agreement (ACl-FTA) eliminated all tariffs, with the exception of sugar. 92% of tariffs that accommodated 97% of merchandise trade were cut as well. Since the FTA was enforced, the number of Australian firms operating in Chile increased significantly to over 200, with several expanding their operations outside Chile and throughout Latin America.

DHL Express streamlines exports from Australia

Businesses in Australia can benefit tremendously by trading with the global market, but what makes any business venture successful is partnering with a reliable logistics company to manage your exports. With time-definite and same-day fast international shipping, alongside a trusted team of handling specialists, you can rest assured that your customers will receive their orders on time and in good shape when you choose DHL Express. Plus, with a suite of digital tools on MyDHL+ to streamline your exports such as digitalised invoices and waybills, and real-time tracking of shipments, your global venture is surely in capable hands. We can also provide you with sound advice on how to protect your business when trading internationally, especially with regular updates on customs regulations and requirements so you experience no delays in your shipments. Engage an express delivery provider like DHL Express and take your business to the next level.