Nickolas Varvaris (Barton, Liberal Party) Share this | Hansard source

I thank the House for the opportunity to speak on today's combined bill, the Customs Amendment (Japan-Australia Economic Partnership Agreement Implementation) Bill 2014, on the Australian-Japanese economic partnership that the coalition has concluded in recent months. This important partnership agreement was seven years in the making, and I am proud that this side of the House was able to successfully complete it within their first term of government. Today's customs amendment bill and customs tariff amendment bill will ensure that one of our most vital trading and investment partners will mutually thrive in a competitive global environment.

Whilst Australia and Japan have enjoyed a warm international relationship driven by mutual interests, there is no denying that Australia's largest trading partner and source of capital investment plays a significant role in further enhancing Australia's growth and prosperity in the Asia-Pacific region. I am excited by this economic partnership agreement and what the bills today will mean for Australian exporters, the agriculture sector and other Australian businesses. Increased bilateral trade, investment and closer economic integration benefit both countries and ensure that Australian businesses remain viable now and into the future.

The recent agreement is a comprehensive, wide ranging one that provides both countries with more liberal access to goods, services and investment markets. It will also ensure that Australian businesses have more accessibility and ease to do business in Japan, which was previously marred by opaque regulations, high tariffs and complex bureaucracy. Australian exporters of consumer goods, non-consumer goods and those in the tourism, education and healthcare sectors all stand to benefit from this economic partnership agreement. More than 97 per cent of Australia's exports to Japan will receive preferential access or enter duty-free when the agreement is fully implemented.

Today's bill will also amend the Customs Act to enable imported goods to enter Australia at a preferential rate of customs levy. In addition, goods imported to Australia that have originated from Japan will have preferential entry. Without the Economic Partnership Agreement with Japan, Australian agricultural and horticultural producers will continue to face high tariffs on commercial agreements, making Australian producers' market share in Japan increasingly difficult to sustain. Australia's ongoing competitive position in Japan is not guaranteed due to the myriad strong producers coming from other nations such as the USA; therefore, the EPA is the first step to ensure that our export businesses can be commercially viable in a saturated market.

It is important to point out that Japan has also been concurrently negotiating trade agreements with other key competitors, including the European Union, Canada, the United States and New Zealand, with trade agreements already in place with the Association of Southeast Asian Nations, Chile, India, Mexico and Peru. The coalition's signing of the EPA will not only deliver tariff elimination and reductions for Australian businesses; it will also position our country above our competitors, through strong renegotiation provisions should Japan provide better access for the above mentioned competitors. Not having signed and delivered the EPA would have been extremely regrettable for our producers. If we did nothing, Australian exporters would face steep tariffs, resulting in loss of market share and no competitive advantage over Japan's other trading partners. We would also be denying Australian consumers cheaper imports.

Japan is a vital and longstanding economic partner. In 2013 alone, our two-way goods and services reached $70.8 billion, of which $28.3 billion was surplus for Australia. For exports, Japan was our second-largest market, with 15.5 per cent of export goods leaving Australia. Yet, Australian exporters face a custom levy of 6.5 per cent of goods exported to Japan, whilst Australian agricultural businesses face an even higher tariff of 16.6 per cent. Japanese trade and investment in Australia in 2013 was valued at $131 billion, whilst Australia's trade and investment in Japan stood at $50.2 billion. Given that Japan is Australia's second-largest agricultural partner and that agriculture is also Australia's vital area of trade, the EPA will make an enormous positive impact on rural and regional communities. High quality Australian goods such as beef, cheese, animal feed, offal, sugar, vegetable oils, seafood, fruit and nuts are some of our most favoured products in Japan, and it would be a real shame for these exporters to lose market share simply due to tariffs. Similarly, Australian wine producers face stiff competition from countries such as Chile, who already have a tariff advantage through its existing trade agreement with Japan. In 2013, Chilean wine exports rose to $178 million, whilst imports from Australia actually decreased to $46 million. Again, given that Australia is world-renowned for its wine quality and its close proximity to Japan, it would be senseless not to be able to export a large quantity due to customs duties. The Japan-Australia Economic Partnership Agreement also guarantees access to the Japanese market for a range of lucrative Australian service providers due to Australia's high reputation in areas such as financial, legal, education and telecommunications services. I commend the bill to the House.

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