This opinion article, by Business Council of Australia Chief Executive Jennifer Westacott, was published in The Australian on 22 November 2014 under the title ‘Free Trade Agreements Open Window of Opportunity for Australia’.

Australia has had a very good week. The G20 summit has reset the international growth agenda with sensible, practical policies that can be applied collectively and within individual nations.

The free trade agreement with China provides Australia with a global competitive advantage, and an historic opportunity to grow and diversify our economy.

When the Business Council describes this agreement as “transformative”, let’s understand what we mean.

The agreement opens an unprecedented level of access for our key sectors into Chinese markets. It builds on Australia’s existing strengths, offers significant opportunity for sectors in transition, and opens up new avenues for growth and job creation.

In July, we released a report that identified tourism, education, resources and energy, advanced manufacturing, agriculture and food manufacturing, professional services and financial services as areas where Australia can be globally competitive.

The FTA with China sets Australia up for strong growth in all of these sectors and many more.

In agriculture and processed foods, tariffs will be eliminated over time on beef, sheep, dairy, wine, seafood and many other products. This will allow Australian businesses to compete at an advantage or, at the very least, on a level playing field in meeting the needs of the huge and growing Chinese market.

As a result of its FTA with China, New Zealand producers of whole milk powder have been trading at a cost advantage over Australian producers. New Zealand dairy exports have surged while ours have flatlined.

The China–Australia FTA improves on the terms of the NZ agreement on dairy and provides an extraordinary opportunity for the sector.

High-quality services are one of Australia’s competitive strengths and largest areas of employment. China is already Australia’s most important export market for services, representing $6.7bn in 2012–13. But Australia has only captured a fraction of the market. In 2012, China imported almost $300bn worth of services and we accounted for just 2 per cent of it.

The removal of trade restrictions in aged care, education, tourism, mining and construction, engineering and manufacturing services gives Australia an unprecedented opportunity to benefit from China’s urbanisation and its increasingly consumer-driven economy.

Natural resources and energy are Australia’s largest exports and China is our biggest market for these commodities. The FTA will help us to maintain our dominant position.

Australian manufacturing is in transition, moving towards niche and advanced products to service global supply chains. The FTA will help us make this transition and create the jobs of the future.

It will remove tariffs on many advanced products that Australian companies sell into China, including car engines and pharmaceuticals. While lower tariffs will make it easier for Chinese companies to compete here, it will also lower the costs of components and materials used by our manufacturers.

Consider the scale of the opportunity. By 2025, 200 Chinese cities will be responsible for some 30 per cent of global growth. Over the next five years China is set to import more than $US10 trillion ($11.5 trillion) in goods. Its outbound investment will exceed $US500bn and its tourists will make more than 500 million overseas visits.

The combined impact of the agreement with China, FTAs signed this year with Japan and Korea, and a commitment to complete negotiations with India within 12 months, puts Australia at the epicentre of Asian growth. We have achieved these agreements in the region that’s set to account for half of the world’s economic output.

The continuity of policy and capacity to be pragmatic that allowed us to negotiate the FTAs are, in and of themselves, comparative advantages because they demonstrate Australia can get things done.

The events of this week bring home the extent of our deep economic interdependence with the rest of the world. They are a wake-up call for all parts of the community to adopt a global mindset.

We have to be more productive. This is not about people working harder for less. It’s about unleashing people’s creativity and capacity to innovate and work smarter, to create new products and new forms of value.

We have to be more competitive. This means our people having the skills and capabilities to perform higher-value jobs. It means having a more competitive tax system, and improved infrastructure.

If we don’t make these changes, not only will Australia fail to realise the full benefit of this extraordinary moment of opportunity – we run a very real risk of being overwhelmed by it.