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Abbott’s Push for Japan Trade Deal Hit by Beef, Dairy Discord

Photographer: Carla Gottgens/Bloomberg

Young Blackmore Holdings Ltd. Wagyu calves graze alongside their mothers on a field in the Mickleham suburb of Melbourne. Japan is Australia’s second-largest trading partner with two-way trade of items including coal, iron ore, copper and beef worth A$69.2 billion ($63.9 billion) in 2012-13, according to government figures. Close

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Photographer: Carla Gottgens/Bloomberg

Young Blackmore Holdings Ltd. Wagyu calves graze alongside their mothers on a field in the Mickleham suburb of Melbourne. Japan is Australia’s second-largest trading partner with two-way trade of items including coal, iron ore, copper and beef worth A$69.2 billion ($63.9 billion) in 2012-13, according to government figures.

Australia’s bid to reach a trade deal with Japan during Prime Minister Tony Abbott’s North Asia visit next week is being jeopardized by a disagreement over agricultural and car tariffs, Trade Minister Andrew Robb said.

The free-trade talks are stuck on the issue of Japanese tariffs on beef and dairy imports, and Australian duties on car imports, Robb said in a phone interview from Melbourne today. Failure to sign an initial deal when Abbott meets with Prime Minister Shinzo Abe April 7 would be “unfortunate,” he said.

“There’s no point conceding just for the sake of getting a signature on Monday,” said Robb, who is leaving for Tokyo today in a bid to break the impasse. “This has to be enduring and beneficial and lead to opportunities on both sides. It would be a great opportunity if we can finalize it but we’re not going to let that hinder the resolution of a quality deal.”

Japan is Australia’s second-largest trading partner with two-way trade of items including coal, iron ore, copper and beef worth A$69.2 billion ($63.9 billion) in 2012-13, according to government figures. Abbott, whose Liberal-National coalition won office in September, will sign a trade agreement with South Korea during his trip and attempt to progress negotiations with China, Australia’s biggest trading partner.

China Deal

The talks with China are more technical than those with Japan and South Korea as there are 11,000 tariff lines that need to be agreed upon, Robb said. Sticking points include China’s concerns over investment and labor mobility, while Australia is keen for progress on agricultural and services issues, he said.

“It will be a few months, I think, before we put that away,” Robb said. Free-trade agreements with India and Indonesia won’t be completed this year, he said, while Trans-Pacific Partnership talks are “about 80 percent there.” More TPP talks are scheduled for May, with the main sticking point being agricultural issues, specifically between U.S. and Japan, he said.

Australia, which will cease making automobiles by 2017 as Toyota Motor Corp., Ford Motor Co. and General Motors Co. shutter plants, wants to protect its 700 car-component makers, Robb said. Japan’s exports of passenger motor vehicles to Australia totaled A$6.8 billion in the 12 months to the end of last June, according to government figures.

To contact the reporter on this story: Jason Scott in Canberra at jscott14@bloomberg.net

To contact the editors responsible for this story: Rosalind Mathieson at rmathieson3@bloomberg.net Edward Johnson

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