Australian Agricultural Policy and the Push for Trade Liberalisation

Internationally, Australia has consistently been a proactive advocate for the liberalization of agricultural trade. This international stance aligns with its domestic policies. Domestically, Australia implements agricultural liberalization and adopts a policy of low protection for agricultural producers. This approach differs from the agricultural policies of most developed countries. However, Australia was not always like this. In the 1940s and 1950s, Australian farmers enjoyed a more complex government subsidy mechanism than the now-criticized Common Agricultural Policy of the European Union (EU). 1972 marked a significant turning point in Australian agricultural policy. The newly elected Labor government under Whitlam implemented two major changes to the structure and focus of Australian agricultural policy. First, the government published a Rural Policy Green Paper, which revealed a preference for a market-oriented approach, attempting to improve the allocation of agricultural resources and compensate for the severe consequences of reforms through government intervention in market operations. Subsequently, the government established the Industries Assistance Commission, incorporating agriculture, which significantly impacted the environment for agricultural policy-making, particularly by fostering a trade liberalization agenda and leading to the establishment of the National Farmers' Federation (NFF) in 1979. However, it wasn't until the Labor government in 1983 that Australia began to actively promote agricultural liberalization policies, adopting a floating Australian dollar, opening financial markets, and unilateral tariff reductions to increase the efficiency and competitiveness of the Australian economy. Simultaneously, Australia actively promoted free trade globally and employed multilateral strategies, uniting with other agricultural exporting countries to form the Cairns Group in 1986 to increase Australia's negotiating leverage in the Uruguay Round. This article aims to analyze the political and economic factors that led to the shift in Australian agricultural policy from a typical developed country model to a stance that strongly advocates for agricultural trade liberalization.