The Business Council of Australia has welcomed the decision to commence negotiations on an Australia–Japan free trade agreement (FTA).
The Chairman of the BCA’s Task Force on Trade and International Relations John Denton said the BCA supported the decision on the basis that the negotiations will be undertaken according to the outcomes of the Joint Study into an Australia–Japan FTA.
“The commencement of FTA negotiations represents an opportunity to reinvigorate Australia’s relationship with Japan on a number of levels,” Mr Denton said.
“At the commencement of the Australia–Japan Joint Study in 2005, the BCA identified a number of key requirements for the negotiation of an FTA.
“These included the importance of entering into comprehensive negotiations with all products, services and relevant issues on the table.
“In addition, the negotiations must aim to secure an agreement that is consistent with World Trade Organization (WTO) undertakings and to advance on the market liberalisation that has already been achieved in the WTO.
“We are very pleased that these requirements form the basis of the findings of the report on the Joint Study that was released today,” Mr Denton said.
The BCA believes that trade and strategic benefits for both Australia and Japan can flow from entering into FTA negotiations.
“Japan is Australia’s largest export market with a total of $34.5 billion of exports in 2005–06. Australia is an important source of resources, energy and food products for Japan,” Mr Denton said.
“At the same time, Australia is a valuable market for Japanese industry.
“Yet despite the overall size of our trade, Australia’s trade and investment relationship with Japan is not as healthy in some important sectors as it is with our other significant trading partners,” Mr Denton said.
The BCA has identified a number of areas where Australia and Japan can further develop economic links, including:
- Addressing non-tariff barriers to both goods and services.
- The liberalisation of services markets, particularly in financial services.
- Freeing up the terms of travel for temporary business purposes and for other individuals with technical expertise.
- The removal of restrictions on the capacity of business professionals to provide services.
“Both Australia and Japan are developed, market-based economies with a number of shared economic and strategic interests. There is the potential to pursue new opportunities of mutual benefit that will strengthen our relationship over the long term,” Mr Denton said.
“While the BCA would like to see further progress made with multilateral liberalisation through the WTO, we also recognise the importance of negotiating bilateral agreements.
“With an opportunity to further develop our long-standing trade and economic relationship with Japan, the objective of a comprehensive Australia–Japan agreement is a welcome addition to the list of key trade priorities for the nation,” Mr Denton said.