SYDNEY (Kyodo) Trade minister Banri Kaieda and his Australian counterpart, Craig Emerson, agreed Friday during their talks in Sydney to work on striking deals at an early date through ongoing thorny negotiations over a bilateral free-trade agreement.
At a joint press conference after their meeting, the ministers also recognized that the two countries are faced with “challenges to be overcome” and thus need to make more efforts in negotiations over the issue of eliminating tariffs on farm products, a sticking point in the bilateral talks.
During their meeting, the first bilateral trade ministerial talks since 2009, Emerson briefed Kaieda on the latest developments in negotiations involving Australia and eight other countries over a trans-Pacific free-trade agreement, according to Japanese officials.
Kaieda told Emerson of Japan’s plan to decide by around June on whether to join the nine countries in the negotiations over the Trans-Pacific Partnership Agreement. Toward that end, Japan will implement measures to further open up the farm sector, Kaieda said.
Emerson voiced praise, saying it is in Japan’s interest.
Kaieda and Emerson met a day after the two countries finished the latest round of working-level free-trade negotiations in Tokyo with little progress.
It was the first time in 10 months such talks were held.
The course of the talks with Australia could affect Japan’s decision on whether to join the TPP negotiations, which may involve a higher level of trade liberalization than seen in current bilateral FTAs, such as by requiring member economies to scrap all tariffs in principle.
The TPP negotiations, built around a regional free-trade agreement that took effect in 2006 among Brunei, Chile, New Zealand and Singapore, are under way to expand the framework to include five other Asia-Pacific countries, including the United States and Australia.
The Kan administration hopes to decide on joining the TPP process around June but faces strong opposition from farmers who fear they may be hit hard by an influx of cheap agricultural imports if Japan joins the pact.
In Thursday’s working-level talks in Tokyo, officials remained reluctant to make concessions on Australia’s demand that Japan eliminate tariffs on sensitive products. For its part, Japan is calling for the abolition of Australia’s 5 percent tariffs on automobiles.
Japanese negotiation sources said Australia is likely to accept Japan’s demand to exempt rice from items subject to tariff elimination, while other sensitive items — beef, dairy products, wheat and sugar — will likely remain targets for tariff elimination.
“If we are asked in which way the talks are heading, it is not in a stalled state and we are deepening mutual understanding and making progress,” a Foreign Ministry official told reporters about the four days of negotiations.
But he also said he feels “there is still a long way to go” and acknowledged that reaching an FTA with Australia by June, as mentioned by some Cabinet ministers, is a “lofty goal.”
If rice is exempted from tariff elimination in the bilateral FTA with Australia, Japan believes its desires may also be respected in the envisioned TPP agreement that is likely to be built on recent bilateral FTAs reached between member economies.
Australia has in the past urged Japan to open up its rice market. But with declines in rice production following droughts in recent years, the level of rice exports to Japan has dropped sharply — not rising above zero in each of the three years from fiscal 2007. In fiscal 2010, Japan-bound exports of Australian rice will be limited to 12,000 tons.
“Australia has no interest in rice,” one of the Japanese negotiation sources said.
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