Best hope in years of free trade deal with Japan

Best hope in years of free trade deal with Japan

A shift in the Japanese Government's view on trade gives Australia one of its best chances yet to secure what could be one of Australia's more lucrative agricultural deals.

Agriculture is a sticking point for a free trade deal between Australia and Japan, but at the APEC conference this month, Japanese Prime Minister Naoto Kan made it clear he wants more trade deals done.

Thousands of Japanese farmers rallied against their Prime Minister's plan to participate in talks over a Trans-Pacific Partnership, saying it would open their agricultural sector to fierce competition.

Federal Trade minister Craig Emerson says the shift in mood by the Japanese Government is good news for Australia, with the next round of free trade talks to be held at the start of next year.

"This is a profoundly important change in Japan," Dr Emerson said.

"The Kan government has recognised the need for reform. The Government wants to spur economic growth in Japan by engaging commercially with the region, through trade and investment.

"And Prime Minister Kan and his Government appreciate that means reforms in agriculture."

Japan is Australia's largest market for beef and dairy, as well as all agricultural products.

It's estimated that a free trade agreement between Australia and Japan could boost Australia's GDP by $39 billion over 20 years.

As Korea signs up to a free trade agreement with the United States (although that hasn't been ratfied yet), and FTAs completed with Europe and Chile, there are significant benefits for those countries' beef, dairy and sugar industries.

Dr Emerson says the Australian Government is committed to a free trade deal with Korea.

There are reports that Australian dairy exports to China are feeling the pinch from a New Zealand and China free trade deal.

Dr Emerson says he's full of enthusiasm for an FTA with China.

He says it's been agreed with the Chinese trade minister that members of the Chinese Government will come to Australia around April next year to look at "breaking the current impasse".