FTA with Japan provides opportunity to broaden two-way trade
Ai Group Chief Executive Heather Ridout has welcomed the joint announcement by Japanese Prime Minister Shinzo Abe and Australian Prime Minister John Howard to commence negotiations for a bilateral Free Trade Agreement between the two countries.
"Japan is Australia's largest two-way trading partner, and there is a clear mutual interest in the two countries further liberalising their trade and investment links," Ridout said.
"Australia and Japan are both modern and sophisticated economies, a fact which will assist the process of negotiating an FTA that produces substantive market access improvements for business.
"Particularly in the context of the stalling of the Doha Round of World Trade Organisation negotiations, it is important that Australia seeks to advance market access with its key trading partners," Ridout said.
"Australia is now examining or negotiating Free Trade Agreements with the three North Asian economic power houses, China, Japan and South Korea, which together account for almost 30% of Australia's two-way trade.
"Japan places emphasis on the need to ensure food and resources security, a priority that Australia is well-placed to assist. Australian industry has found it extremely hard to break into the Japanese market outside of the resources area. These FTA negotiations provide a real opportunity to broaden Australia's trade with this key market. The coming FTA negotiations will provide industry with the mechanisms to address regulatory impediments and other non-tariff barriers to Australian exports and investment.
"The independent report on the potential benefits of bilateral trade and investment liberalisation, commissioned by the Federal Government, found that Australia's non durable manufacturing sector would experience the largest gain in output of all sectors of the Australian economy," she said.
"We welcome and support the Joint Study's recommendation that the FTA between the two countries be comprehensive, WTO-consistent (and WTO-plus where possible) and concluded through a single undertaking.
"Ai Group looks forward to working with the Federal Government to optimise the benefits for Australian business that stand to be reaped from this important initiative," Ridout said.