Bridget McKenzie (Victoria, National Party) Share this | Link to this | Hansard source

Congratulations, Mr Deputy President, on your unanimous election earlier this week. I rise to celebrate, as we all have been in this place today, a significant milestone in our trade partnership with Japan. Prime Minister Tony Abbott this afternoon signed the Japan-Australia Economic Partnership Agreement with Japan's Prime Minister, Shinzo Abe, after the Prime Minister of Japan had addressed a joint sitting of parliament and definitely indicated to all of us why he has been so successful in his home country. His charming and honest reflection of our relationship and the future of the relationship between our two countries was indeed a breath of fresh air.

The agreement will drive growth, create thousands of jobs and, importantly, benefit our farming, manufacturing, services and resource sectors and other industries. It is a first for Japan, and I am sure in no small part it is because of Prime Minister Abe's leadership. But first I want to remind this chamber and the Australian people of a remarkable man, politician, prime minister and former Leader of the Nationals, Sir John 'Black Jack' McEwen, who helped foster the great friendship and trade relations that we have with Japan today.

Born in Chiltern in the north-east of my home state of Victoria and a farmer near Shepparton, Sir John 'Black Jack' McEwen went on to represent the people of northern Victoria when elected to parliament in 1934. He became the Minister for Commerce and Agriculture, then Minister for Trade and Industry in the Menzies government, where he was instrumental in initial trade talks with Japan that resulted in the post-war Japan-Australia treaty in 1957. This historic agreement has been mentioned many times today and is also significant to Japan's Prime Minister Shinzo Abe, visiting here today, whose grandfather and then Japanese Prime Minister Nobusuke Kishi signed the 1957 treaty with Australia. Black Jack McEwen said in a statement on the treaty at the time:

There have been two principal goals. We need a trade agreement with Japan to preserve the great stake that we already have in that market. We need an agreement also to gain important new benefits in the Japanese market. Both of these objectives have been achieved to a very large degree.

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It gives a new basis of security for the great trade Australia already does with Japan.

It gains new and important benefits for Australian export to Japan.

The provisions of the Agreement safeguard Australian rights of access to the Japanese market on terms at least as favourable as those of any other country. This applies to all Australian products for which there is export opportunity in Japan.

The benefits to agriculture and other commodities were evident, as Black Jack McEwen highlighted in an address to the federal council of the Australian Country Party in 1970: 'We negotiated a trade treaty with Japan, and now we have made tremendous progress in developing the Japanese market for a whole range of rural and other exports: wool, wheat, mutton and lamb, beef and cheese, and tallow. These are a few examples of the kind of progress we've been able to make, and with all the negotiating vigour and skill we could muster in tackling the export price, the marketing problems of the Australian farming community as they have emerged.'

I am pretty confident that, over the last seven years, the current agreement which our nations subscribe to today resulted with no less negotiating vigour and skill. It was begun under Prime Minister Howard and completed thanks to Trade Minister Robb. The Australian farming community will benefit. There is contention about who will benefit and by how much, but I think we are all confident in the benefits that free trade can bring to our nation and to our region more generally. I am not sure, though, that tallow is in the regulations of the current agreement!

Former foreign minister and previous Howard-Anderson government minister Alexander Downer commented on the significance of the 1957 treaty and its 1963 revision, in which Black Jack McEwen also played a significant role:

The Treaty heralded an era of unprecedented high level dialogue and underwrote the subsequent dramatic growth in trade relations between Australia and Japan. For Australia, the Treaty was a clear vote of confidence in Japan's ability to sustain its impressive post-war economic growth. The Treaty was also a constructive way of encouraging Japan's inclusion in regional and global deliberations—of facilitating, where possible, an international role for Japan more commensurate with its growing economic prowess.

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The Treaty's flow-on benefits to all other aspects of Australia-Japan relations were evident almost immediately.

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The Commerce Treaty thus stands as one of the most important achievements in the long history of Australia's engagement with the Asia Pacific region. It laid the indispensable basis for a better and more durable Australia-Japan relationship.

In 1973, the Japanese government conferred on Black Jack McEwen the Grand Cordon of the Order of the Rising Sun. A spokesman for the Japanese embassy in Canberra said at the time that this was the highest Japanese award that could be conferred on a foreigner and that the award was made in recognition of Sir John's part in furthering friendly relations between Australia and Japan. Thanks largely to Black Jack McEwen, Australia and Japan have strengthened their ties and friendship over the years. Today's signing of the economic partnership agreement is a symbol of that. As a result, our farmers, students and education providers and manufacturing and resource sectors, and many other industries, will benefit. I pay particular respect to and congratulate Minister Robb for his role in that.

Aside from the strategic relationship and the sharing of defence matters, three key areas identified by the Deloitte report 'Beyond Boom'—agriculture, education and energy—are comprehensively addressed by the economic partnership agreement. They are all areas in which regional Australia has a strategic advantage to capitalise on. The Japan-Australia Economic Partnership Agreement will deliver significant opportunities and benefits to Australian farmers and agricultural producers in a highly valuable but protected market. Japan is Australia's second largest agricultural market, worth around $4 billion in 2013, but Japan had high tariffs of up to 219 per cent on agricultural imports and Australian exporters have had to navigate a complex regulatory framework. I was fortunate enough to be in Tokyo, meeting with Meat and Livestock Australia, the day after Andrew Robb flew out and came to agreement with the Japanese government. The feeling of Meat and Livestock Australia was incredibly high that day because of the significant drop in, particularly beef, tariffs in a market where the relationship between the parliament and the rural industries is particularly strong. It makes the French look particularly weak.

Key agricultural outcomes on the agreement's entry into force include the rapid reduction of the high 38.5 per cent tariff for beef, Australia's largest agricultural export to Japan, worth $1.4 billion in 2013. Modelling shows that this outcome alone will deliver gains to the industry of up to $400 million a year. Wine is another commodity that Prime Minister Abe made mention of at the official dinner tonight. There is the elimination over seven years of the 15 per cent tariff on bottled wine and the immediate elimination of the tariff on bulk wine, a particular boon to wine producers right around the Murray Region in Victoria.

The dairy industry is one of the commodity groups that did not get exactly what they would have preferred. It has high hopes for the China free trade agreement. It gained immediate duty-free quotas for Australian cheese, immediate duty-free access for the growing trade in milk protein concentrates, lactose and casein, which we like to call black gold, and new opportunities for ice cream and frozen yoghurt. For the horticulture industry, another significant component of the agricultural industry in my home state of Victoria, there is the immediate elimination of tariffs of up to six per cent, and higher tariffs will be eliminated over five to 10 years.

For the grain industry there is immediate duty-free and quota-free access for Australian wheat and barley for animal feed, streamlined export arrangements for some Australian wheat varieties, and the elimination of the 21.3 per cent tariff on wheat gluten and tariffs on canola and vegetable oils for up to 10 years. For processed foods, tariffs of up to 29.8 per cent on juice; canned fruit, another significant product out of central Victoria; soup; jam; peanut butter; tea and pet food will be eliminated. This is great news for Victorian farmers and processers. Australia is also the first major agricultural exporter to secure a bilateral trade agreement with Japan, delivering a first-mover advantage and future-proofing exports against future trade deals our competitors are seeking with Japan.

Japan has guaranteed market access for Australian education providers to Japan's higher education services market, including vocational and technical education. Japanese students seeking to study at a wide range of Australian education and training providers listed on the Australian National Register of Higher Education Providers will be able to apply for low-interest loans offered by the Japan Student Services Organization. This will particularly benefit the international competitiveness of Australia's TAFE sector. Japan has guaranteed that it will treat all Australian education providers in areas other than primary and secondary schooling as it does Japanese providers. This includes improved commitments on adult education and secures existing access for Australian universities in Japan. Australia and Japan have further agreed to cooperate bilaterally and exchange information regarding policies to promote the recognition of each other's qualifications. That is a significant challenge, but it will be fabulous when it occurs.

Australia and Japan have agreed to improve access to graduate studies in each other's country and strengthen student mobility between both countries as seen by our New Colombo Plan. At the official dinner tonight we welcomed some students who will be heading off to Japan shortly. These outcomes have been welcomed by Universities Australia as further strengthening cooperation in higher education between the two countries. On my visit in April I was able to talk with officials from Kyoto University and Kyoto higher education providers more generally to discuss the opportunities. They were very keen for Australian students to be aware of how beautiful their city is, the quality of the education they are able to provide and the diversity of the education available within the city of Kyoto—similarly with Hiroshima University, which I was also able to visit. They are looking forward to being able to take advantage of the opportunities that the New Colombo Plan will provide them.

The two areas of concern that I heard consistently when I was in Japan were the issues of food security and energy security, with Japan having to import a significant proportion of its nation's needs in both of those areas. That is why the Australia-Japan relationship is so strong. We obviously have a competitive advantage in both those commodity areas.

In 2013 Australia exported more than $42 billion worth of resources, energy and manufactured products to Japan. On the agreement's entry into force, 99.7 per cent of Japan's imports of these products from Australia will enter Japan duty free. On full implementation, all of Australia's current resource, energy and manufactured exports will enter Japan duty free through a navigational system which we hope remains secure so those commodities will reach Japan safely. Australia will continue to enjoy tariff-free access for automotive parts; pharmaceuticals and vitamins; medical instruments and apparatus; paper; household items, including whitegoods and electronics; sheepskins and cowhides; as well as all large resource exports, including iron ore, coal and LNG.

One of the great aspects of Prime Minister Abe's visit to Australia is that he brought such a large business delegation with him. Yesterday it was an absolute privilege to meet with Kawasaki and talk about potential investment opportunities for that company in the Latrobe Valley in my home state of Victoria. Foreign investment in energy, particularly by Japan, could lead to economic and environmental benefits flowing to both nations as a result of the partnership, thanks to the really high-level research that is being done. Japan is now the third largest source of investment, worth about $131 billion, in Australia.

The Japan-Australia Economic Partnership Agreement follows the successful conclusion of the free trade agreement with Korea. The Abbott-Truss government will now focus on securing a free trade agreement with China. These three countries are Australia's biggest export markets, accounting for 50 per cent of all our exports. It is a stark contrast with Labor's effort that, during their six years in government, failed to secure a single agreement with these countries. This is an agreement built on a relationship that began so many years ago and is based on common respect for our traits of resilience and courage, a mutual commitment to the rule of law and to democratic principles.

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

Before I adjourn the Senate, I want to thank Senator Sterle for stepping in as Acting Deputy President from 7 to 7.30 this evening at very short notice and, in particular, Senator Smith, who stood in from 7.30 to 9 pm, again at very short notice. Their cooperation in this matter is very much appreciated. I thank them both.

Senate adjourned at 21:40