The Australian wine industry should benefit from a free trade agreement signed between Australia and Thailand yesterday.

The deal will see half of Thailand's 6000 tariffs on Australian goods go, when it begins late next year or early in 2005. Almost all others tariffs will be phased out by 2010.

In particular Australian Prime Minister John Howard hopes the deal will provide "quite special" opportunities for the Australian car and wine industries.

Currently Australian wine exports to Thailand face a tariff of more than 50%. This will be cut to around 15%, and then phased out over the next 12 years.

The Winemakers' Federation of Australia's Tony Battaglene was quoted today saying: "I think where the big difference it will make, will be over the next five or 10 years when we really need to move into the market. It will allow wine to establish itself and with future phase-ins of tariff cuts, I think you could see this becoming quite a decent little market for us."