Transcript: Japan-Australia Economic Partnership Agreement (JAEPA) Update
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Leonie Muldoon: The great thing about the EPA is that it brings together the two most complimentary trading partners in the Asia-Pacific region. It lowers tariffs across a whole raft of products for Australian exporters and it gives them better service sector access.
In reverse the EPA gives some benefits to Japanese investors looking at the Australian market. So I think it’s a historic moment in the bilateral relationship and we’d like to see Australian exporters take advantage of it.
The other important part of the agreement is that it just puts a spotlight back on this very important market. Japan’s our second largest trading partner and it’s a really large market, well aligned with the kinds of products that we want to export. It’s a market that demands premium products and is well positioned to pay for premium products, and so the supply and demand alignment is very good between Australia and Japan.
We’re going to see some real benefits for exporters. Frozen beef gets an immediate tariff reduction of 8% and chilled beef 6%. So that means we’re going to be very competitive in the Japan market against US beef and I think there’s an opportunity to get a step ahead.
We’re also seeing some increased no tariff quotas in the dairy area, so that’s going to be really helpful to our yoghurt producers, cheese producers and ice cream producers particularly.
And then on the other hand, on the energy side, Japan’s basic energy plan assumes an ongoing reliance on coal, iron ore and LNG. So again, here’s some big opportunities for Australian exporters.
The EPA is going to be really important because it guarantees us cross-border access in terms of wealth management and portfolio management services. So when you think about the Japan market, it’s the second largest pool of wealth globally and because they’re looking at an ageing population there’s incredible pressure to improve the returns that these funds are generating.
Australia has some terrific funds management expertise and Japan is a very prospective market for those groups, and the EPA just enhances that opportunity.
So the EPA is coming at a great time. Japan is already experiencing significant change under Prime Minister Abe’s Abenomics, and in particular his Third Arrow reform agenda, which is opening up opportunities in a range of sectors.
Above and beyond that, Japan was successful in securing the 2020 Tokyo Olympics and the 2019 Rugby World Cup. So there are some major opportunities there for our major sporting event providers, whether that be in the form of architectural or design services for stadiums, construction services, event management, catering, security. We’ve got a tremendous capability that we’ve built up in the Sydney 2000 Olympics and that have been honed over a number of major sporting events since then.
So Austrade is really well positioned to help exporters maximise the advantage of the EPA. We have four offices across Japan and we have quite an extensive network of business development managers who have good networks themselves, terrific industry expertise, and are well positioned to assist Australian exporters really maximise this agreement.