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Australian Trade Minister Mark Vaile on Monday said he is seeking an expanded economic relationship that would activate economic interactions between Japan and Australia, a Foreign Ministry official in Tokyo said.

In a meeting with Foreign Minister Yoriko Kawaguchi, Vaile said bilateral economic relations have been healthy and stable, but that the two countries should promote discussions to help strengthen them.

Kawaguchi said she hopes to discuss with Australia what steps can be taken toward that end, adding it is desirable to have a cooperative and mutually stimulating economic relationship, the official said.

In their meeting at the ministry, Vaile pointed out there are some sensitive areas, including agricultural products and southern bluefin tuna, and emphasized the need to set up an expanded framework for economic cooperation that would not be influenced by individual problems.

Kawaguchi and Vaile agreed that the two countries should resume ministerial dialogue, which has been suspended since 1997, in the near future.

The dialogue was launched in 1972 with about seven Cabinet ministers from each side in areas such as foreign affairs, finance, trade, transport, agriculture and the environment. Representatives visited each other’s capital about once every two years, the official said.

Free-trade area eyed

SYDNEY (Kyodo) Australian business leaders have proposed a two-stage economic and trade agreement ahead of Prime Minister Junichiro Koizumi’s visit here at the end of the month, with an eye to creating a free-trade area with Japan, the Australian Financial Review reported Monday.

The agreement is aimed at first forging an accord on nonfarm goods and services. The two countries would then attempt a deal on the more difficult agriculture sector.

The Australia-Japan Business Cooperation Committee is supporting efforts to broaden bilateral economic ties with Japan by setting up an agreement to further reduce trade barriers and harmonize standards and technical regulations, the newspaper reports.

The committee’s president, Hugh Morgan, wrote to Australian Prime Minister John Howard on April 4, urging him to initiate negotiations on a trade pact during Koizumi’s Canberra visit, according to the report.

The committee, made up of top Australian businesspeople, is pushing for a formal agreement on creating a free-trade area covering goods and services trade between the two countries, it said.

The group wants the agreement to also include measures to deepen integration of the two economies within a time frame to be agreed on between the two governments.

But the organization, sensitive to reservations about agriculture, said any such agreement should be in line with the requirements of the World Trade Organization and should not exclude any sector from full liberalization, the newspaper reports.

Australian officials have voiced skepticism about any agreement with Japan that glosses over access to agricultural commodities, out of concern that this would weaken Australian arguments for a lowering of barriers to agricultural trade under multilateral arrangements such as the WTO.

Adding to pressure on Canberra is news that Tokyo is pushing ahead with plans for an ASEAN-plus-five free-trade pact before 2010.

The envisioned free-trade zone would encompass Japan and the 10-member Association of Southeast Asian Nations, as well as China, South Korea, Hong Kong and Taiwan.

While Japanese officials reportedly indicated Australia and New Zealand would eventually be included in the arrangement, the speed of developments is likely to spark concerns that Australia risks being sidelined from the new East Asian regionalism.

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