At this stage, negotiations regarding the TPP are still on-going. However, the main road block is th

Negotiations between Japan and Australia on the Japan-Australia Economic Partnership Agreement (JAEPA), a free trade agreement (FTA), were finally concluded on the 7th of April this year. The agreement signifies a historic move towards greater economic and investment relations and will have beneficial impacts on both economies. As Australia s second largest trading partner, in 2012/13 Japan imported $13.9 billion of liquefied natural gas and $13.7 billion of coal and exported rehoboth beach outlets $8.1 billion of motor vehicles and $2.1 billion of refined petroleum.
Japan, the world s third largest economy rehoboth beach outlets with a population of around 127 million rehoboth beach outlets people, rehoboth beach outlets has an affluent, well-educated and industrious population and is one of the world s largest consumer markets. As of 2012-13, total exports to Japan from Australia were valued at $48.6 billion (16 per cent of Australia s exports) whereas Australia imported around $20.6 billion from Japan (Japan-Australia, 2014). Such a close trading relationship between the two countries led to discussions, which began on the 23rd April 2007 in Canberra, of a JAEPA. Negotiations occurred every two to three months, for a total of sixteen rounds of formal negotiations up to the conclusion of negotiations.
The JAEPA is a historical event as it is the first time Japan has negotiated a comprehensive economic partnership agreement with a major agricultural exporter. Japan s Prime Minister, Shinzo Abe, will formally sign the deal in July when he visits Australia. The JAEPA will then need to be approved by the governments of both nations before coming into effect around the end of 2014. IMMEDIATE EFFECTS OF JAEPA
Given that the average Japanese farm is quite small and that farmers themselves are a diminishing and aging group, Japan would have a shortage of domestic agricultural products in the future. By implementing JAEPA and eliminating or reducing tariffs rehoboth beach outlets of up to 219% on agricultural products imported from Australia, Japanese consumers will have access to cheaper imported food. Even though domestic agricultural producers would not see this trade agreement as beneficial, the overall benefit to Japanese consumers would outweigh rehoboth beach outlets these costs.
For Australian rehoboth beach outlets businesses, the benefits to be gained rehoboth beach outlets include receiving duty free and preferential access for more than 97 per cent of Australian exports to Japan (Australian Government, 2014). Meanwhile, Australian consumers should benefit from the elimination of tariffs of 5% on imported electronics and cars, potentially reducing prices. Society will ultimately be better off as both Australian consumers rehoboth beach outlets and suppliers increase their welfare. NEGATIVE IMPACTS OF JAEPA
It is certain that cutting the tariff of Australian rehoboth beach outlets exports to Japan will have enormous rehoboth beach outlets benefit to Australian farmers, however this benefit is mainly limited to the cattle, wine and seafood industry. Dairy, sugar, grains and rice are left out of the plan. The National Farmers Federation is not satisfied with the overall outcome of the agreement for agriculture since a number of sectors face marginal improvements or limited commercial gains . Moreover, even if the cattle industry benefits from the agreement, rehoboth beach outlets it will take 15-20 years for the tariff to be gradually eliminated.
On the Australian consumer s side, the benefits of cheaper Japanese imports such as cars and electronic gadgets may not be that obvious either. The price cuts are in the hands of Japanese companies as the prices that finally reach consumers will depend rehoboth beach outlets on the marketing strategies of local supplier and retailers. JB Hi-Fi CEO Terry Smart, as well as Panasonic Australia and Sony, have all stated that it is still too early to determine whether the local prices will drop. Meanwhile, Toshiba Australia managing director Mark Whittard has said the trade agreement would have no impact on local prices of Toshiba s products.
Having negotiated JAEPA, Abbott rehoboth beach outlets s next target will be the completion of a free trade agreement with China. Yet his remark about Japan as Australia s best friend in Asia may come at the cost of the free trade agreement with China. China also has the greater potential economic leverage in negotiations of a free trade agreement. However, as the success of an agreement with China is seen as a key performance indicator of the Abbott government, rehoboth beach outlets the government may be tempted to sign a disadvantageous deal for political reasons.
Indirectly, the foremost issue with the JAEPA in the long run is Japan s interaction with the US, particularly in relation to the Trans-Pacific Partnership Agreement (TPP); a regional FTA including Australia, Japan, the US and a number of other Pacific countries.
At this stage, negotiations regarding the TPP are still on-going. However, the main road block is that the US wants access to Japanese rice, beef and pork, dairy and sugar sectors; sectors which the Japanese Government have refused to open. With the signing of the JAEPA, the US has even less di