Australia's Market Access Agenda Towards Japan

The Australian Government’s trade policy with Japan since the 1980s has aimed to improve market access in the hope of addressing Australia’s dependence on a narrow range of commodity exports. When bilateral negotiations proved almost completely unsuccessful in diversifying or expanding exports, Australia decided to pursue its bilateral goals through multilateral negotiations. This approach was successful in the cases of the beef and rice markets, especially when the weight of the United States was behind the negotiations. When the US attempted to use managed trade to increase its exports of cars and car parts to Japan, Australia supported Japan’s protestations and ensured that the US–Japan Framework Agreement was implemented on a MFN basis. Trade diversion still occurred, however, with Japanese buyers being biased towards American goods. While the outcome of Japan’s market-opening measures will not become entirely apparent for a number of years, this paper warns that open markets may not necessarily lead to increased Australian exports.