Australia and Japan: A trusted partnership
November 3, 2020
As global economies fight back against the challenges inflicted on their industries by the pandemic, Japan and Australia remain trusted partners, ready and willing to continue working closely together.
Both Australia and Japan are addressing the COVID-19 pandemic effectively and are set to remain intrinsically tied in terms of trade, business and a shared desire to strengthen their economic relationship.
Australia and Japan
Australia’s exports are sought after by governments, businesses and consumers around the world. Australia’s exports to Japan included natural gas, coal, iron ore, copper ores and concentrates, aluminium, cosmetics and beauty products and food and beverage products including beef and wine.
As an import-reliant economy, Japan has developed a strong bond with trusted Australian-based suppliers. The Japan – Australia Economic Partnership Agreement (JAEPA) signed in Canberra on 8 July 2014 and entered into force on 15 January 2015 has facilitated stronger two-way trade between both countries.
China: The world’s market
China’s population currently stands at nearly 1.4 billion people. The country remains a huge market for investors and businesses from Japan and the rest of the world. The Chinese market is said to include 450 million middle-income people and 150 million high-income people.
Dianne Tipping, Chair of the Export Council of Australia:
“Japan, is one of our most dependable customers, was our top export market for many decades and today remains second only to China. Japan was Australia’s second-largest trading partner in 2018-19, with two-way goods and services trade valued at $88.5 billion. Japan is Australia’s second-largest export market”.
“The mutual trust in our trading relationship has, in turn, lead to the investment of capital that has played an important role in strengthening growth in the Australian economy. Traditionally, that investment was concentrated in primary production; areas such as agriculture and mining, which accounted for the vast bulk of our exports. Now it is flowing into new areas such as technology, services, research and development: drivers of innovation that will shape the future of both economies. In recent years the relations have expanded beyond strong economic and commercial links to other areas, including culture, tourism, defence and scientific cooperation”.
Two quality-driven economies
Japan and Australia both appreciate quality services and products and this appreciation for high-standards has bound the two countries closely together for years.
Ben Lazzaro, Chief Executive Officer of Australian Made Campaign Limited:
“Products originating from Australia have a reputation for quality, safety and sustainability – important attributes when considering purchasing imported products.
Post-COVID-19
Improving market access will be the key to strengthening trade relations between Australia and Japan. With COVID-19 disrupting global supply chains, businesses are searching for new solutions to reach existing customers and expand into new markets.
Sally Townsend, Chair of the Australian and New Zealand Chamber of Commerce in Japan:
“As our two countries look to the future post-COVID-19, the Australia-Japan economic relationship remains a vital partnership in the economic recovery of our region, post-COVID-19”.
Full Statements
Sally Townsend, Chair of Australian and New Zealand Chamber of Commerce in Japan
“The Australian and New Zealand Chamber of Commerce in Japan is proud to have supported the growth and development of the Australia-Japan economic relationship since our establishment in 1972, around the time that Japan became Australia’s largest trading partner.
Today, Japan remains the third largest economy in the world and Australia’s second largest market for exports, particularly natural gas, coal, iron ores & concentrates, and beef. In 2018-19 alone, Australian goods exports to Japan were worth approx. A$59.1 billion, recording a 20.7% year-on-year growth and ranking as Japan’s third largest source of imports.
Through the formation of the Japan-Australia Economic Partnership Agreement (JAEPA) in January 2015, Australian exports have received vastly improved market access, with Japan eliminating or reducing tariffs on beef, wine and seafood, and introducing duty-free quotas for Australian cheese and ensuring that, by 2034, all Australian exports of energy, resources and manufacturing will be able to enter Japan duty-free.
After the introduction of further agreements under the CPTPP in 2018, Australian exporters to Japan are assured continued market access, certainty and new opportunities, and Japanese consumers are able to enjoy greater access to our safe, premium and much sort-after products including beef, lamb and wine. As our two countries look to the future post-COVID-19, the Australia-Japan economic relationship remains a vital partnership in the economic recovery of our region post-COVID-19”. www.anzccj.jp
Dianne Tipping, Chair of The Export Council of Australia
“For over 60 years, the Export Council of Australia (ECA) has provided practical skills development, advice and advocacy to the Australian export community. The ECA has the development of Australia’s resources via the promotion of Australian industry in international markets as our primary goal. We achieve this goal by:
– Developing international business skills
– Building Australian business capacity
– Conducting international market research
– Helping to break down barriers to trade
– Building global networks
– Informing Australian trade policy
The challenge is: how in Australia can we capitalise on these market opportunities and support Australian companies to take advantage of international opportunities?
Australia has many international trading partners however one of our strongest partners is Japan. The Japan – Australia Economic Partnership Agreement (JAEPA) was signed in Canberra on 8 July 2014. The agreement entered into force on 15 January 2015. JAEPA benefits both Australia and Japan. The agreement creates economic growth by increasing opportunities for investment and trade.
Japan, is one of our most dependable customers, was our top export market for many decades and today remains second only to China. Japan was Australia’s second-largest trading partner in 2018-19, with two-way goods and services trade valued at $88.5 billion. Japan is Australia’s second-largest export market.
Goods exports to Japan were $59.1 billion in 2018-19, which was 15.8 per cent of our total goods exports. In 2018-19, Australia’s major merchandise exports to Japan included natural gas ($20.2 billion), coal ($19.3 billion), iron ore ($5.8 billion), beef ($2.3 billion), and copper ores and concentrates ($1.8 billion) and aluminium ($1.3 billion). Japan was Australia’s largest merchandise export market for key commodities including coal, LNG, beef and aluminium.
On the other side of the trade ledger, in 2018-19, Japan was Australia’s third-largest source of goods imports, including passenger vehicles ($7.9 billion), refined petroleum ($4 billion), goods vehicles ($1.9 billion) and gold ($1.1 billion).
The mutual trust in our trading relationship has, in turn, lead to the investment of capital that has played an important role in strengthening growth in the Australian economy.
Traditionally, that investment was concentrated in primary production; areas such as agriculture and mining, which accounted for the vast bulk of our exports. Now it is flowing into new areas such as technology, services, research and development: drivers of innovation that will shape the future of both economies. In recent years the relations have expanded beyond strong economic and commercial links to other areas, including culture, tourism, defence and scientific cooperation.
Japanese investment, alongside trade, has been important for Australia over the years. It helped Australia to open up vast areas of regional Australia, for example, including the iron ore of the Pilbara, the coal of the Bowen Basin and the gas of the North-West Shelf.
For the future, there are exciting prospects for further collaboration in renewables, hydrogen fuel, artificial intelligence, cyber security and vehicle automation, particularly in the mining sector. Australia’s world-class health and medical technology sector is another sector well placed to partner with Japan as it wrestles with the demands of an aging population.
Australian research institutes and universities are working with Japanese firms across several fields, particularly pharmaceuticals and regenerative medicine, which has been identified as a priority by the Japanese Government. The stability of Australia’s trade and investment relationship with Japan for the past 60 years confirms a trusted partnership”. www.export.org.au
Ben Lazzaro, Chief Executive Officer of Australian Made Campaign Limited
“Products originating from Australia have a reputation for quality, safety and sustainability – important attributes when considering purchasing imported products. As a result, thousands of brands have chosen to highlight their Australian origins by becoming certified as genuinely Australian and carrying the Australian Made logo—the famous green and gold kangaroo brand. The Australian Made logo makes the ‘Australian connection’ instantly and clearly for shoppers in export markets such as Japan. When consumers buy Australian Made and Australian Grown products they know they are made to some of the highest manufacturing standards and grown in a clean, green environment.
The Australian Made logo is Australia’s most trusted, recognised and widely used country of origin symbol, and is underpinned by a third-party accreditation system administered by the not-for-profit Australian Made Campaign Ltd. For more than 30 years, the Australian Made logo has helped brands communicate their Australian credentials to consumers and businesses both in Australia and around the globe.” www.australianmade.com.au
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Dianne Tipping, Chair
The Export Council of Australia
Australian Made Campaign Limited Logo