Japan and Australia have apparently reached an agreement regarding the agricultural section of a bilateral free trade agreement. The implications of this agreement could reverberate well beyond the two nations, however, since both are currently in negotiations with the United States to create a Pacific Rim free trade zone.
The talks, which have been in negotiation since 2007, had stalled over agricultural trade agreements. Japan, despite importing a significant portion of its food, has a powerful farm sector (which many claim wields disproportionate power).
The Japanese farm sector is particularly concerned with rice production, which constitutes a major portion of Japan’s farm economy. Historically, the Japanese government has insisted on high tariffs on agricultural products, particularly rice.
The agreement between Japan and Australia would allow Japan to maintain high tariffs on major farm products, not including rice, a major sticking point between both nations.
The success of this trade agreement could be a positive sign for future trade negotiations. US Trade Representative Ron Kirk is currently in the middle of negotiations with Japan, Australia, and several other Pacific nations regarding the creation of a free trade zone similar to NAFTA.
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Written by: Justin Ellison / Farm Plus Staff Writer