The Prime Minister’s trade mission to North Asia has changed the global agricultural landscape. Since the formation of the World Trade Organisation, Japan has never signed any trade deal that has given away one inch to a foreign agricultural exporter.
The US, Canada, Chile and New Zealand have all coveted greater access to this giant economy that consumes over 860,000 tonnes of beef and over 300,000 tonnes of cheese each year.
Farmers have been dismayed by the Japanese staunch resistance to free trade.
Many countries have sought to help their farmers by alternate routes into the market via multilateral and regional agreements, like the Trans Pacific Partnership.
All had thought that Japan would never give any ground to one nation alone.
Australia is now the exception.
Our diplomats, led by Andrew Robb, have now won privileged access to one of the most wealthy and hungry nations for farming exporters.
While we have not completely scaled the walls, we have created the breach for future deals.
In beef the gains have been strong.
The reduction in chilled beef from 38.5 per cent to 19.5 per cent and in frozen beef from 38.5 per cent will add $5.5 billion to our economy.
This is to say nothing of how many jobs will be created in a sector that employs more than 20,000.
Dairy has seen quotas expanded and in the longer-term can be used to bring down tariffs that remain.
The increase in quotas will grow the sector and allow more market share in Japan. No other foreign producer has this edge.
Our dairy industry should now look to New Zealand’s development of dairy deals with China. Their exports have grown to the point where a country of just over the population of Victoria now provides two thirds of China’s dairy imports by value.
This $2.2 billion dwarfs Australia’s current $70 million dairy exports to China.
We are hunting for a similar competitive advantage with the Chinese, trying to play catch-up while New Zealand attempts to do likewise with Japan.
When the Howard Government struck the US deal in 2004 similar complaints were made of the time-frames for agricultural access.
Ten years later such complaints are no longer heard. When Free Trade Agreements are finalised it is a starting point, not an end.
Gaining access to overseas agricultural markets will always be a marathon, not a sprint.
Seven years may seem a long time for what we have gained but those who are impatient should look at the long-term implications.
Japan has begun to open its agricultural sector to the outside world.
Other countries are looking to Australia’s achievements and are envious. Right now, we’re leading the pack with Japan on our own.
Source: Weekly Times
