Australia reaches FTA with Japan

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Australia reaches FTA with Japan

Horticulture is expected to be one of many beneficiary industries in Australia after the conclusion of negotiations for an historic free trade agreement with Japan on Monday.

Australian Prime Minister Tony Abbott.

Australian Prime Minister Tony Abbott.

In a joint media statement, Australia's Prime Minister Tony Abbott and Minister for Trade and Investment, Andrew Robb, said the beef, cheese, horticulture and wine sectors would get a "head start" over competitors in Japan as a result of the deal.

The agreement comes hot on the heels of an Australia-South Korea FTA, which is expected to be signed Tuesday in Seoul.

"The Japan-Australia Economic Partnership Agreement (JAEPA) will deliver a significant boost to Australian farmers and other agricultural producers, resource exporters, service providers and consumers," they said.

"Cheese, by far Australia’s largest dairy export to Japan at AUD$372 million (US$345 million), will gain significant new duty-free access. Australian horticultural producers will gain from immediate tariff eliminations across a wide array of fruit, vegetables and nuts.

"The tariffs on canned products such as tomatoes, peaches and pears, as well as fruit and vegetable juices, will also be eliminated."

Australian vegetable and potato grower body Ausveg praised the deal, which will see the elimination of 3% tariffs on products such as carrots, asparagus and cabbage.

"Australian horticulture [sic] the potential for significant trade growth in Japan, so to see reduced tariffs for products like carrots, asparagus and cabbage will mean that it will be easier for Australian growers to get these products onto the shelves of Japanese supermarkets," Ausveg spokesperson Hugh Gurney said in a release.

"This agreement will further assist the Australian vegetable industry to establish trade in Asia, with market access for a greater range of vegetables the next priority for industry in order to take advantage of lower tariffs."

Ausveg highlighted that Australia shipped AUD$51,126,066 (US$47,430,276) worth of asparagus to the East Asian nation in 2012-13.

"When you’re talking about over $50 million dollars, a three per cent reduction in costs for accessing Japanese consumers equates to a significant amount of money that an Australian asparagus grower can choose to reinvest into their business," Gurney said.

Beef is Australia's biggest agricultural export industry to Japan with a value of AUD$1.4 billion (US$1.29 billion) annually. Under the partnership agreement, Japanese tariffs on Australian frozen beef will be cut from 38.5% to 19.5%.

"Australian consumers will also be major beneficiaries of this Agreement, with tariffs eliminated on imported cars from Japan, as well as on household appliances and electronics," Abbott and Robb said.

"Australian services providers will also gain significant new access to the Japanese market across areas such as financial, education, telecommunications and legal services.

"JAEPA sends a strong message to Japanese investors that Australia is open for business."

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