The Chamber of Minerals and Energy of Western Australia (CME) welcomes the Economic Partnership Agreement (EPA) entered into on 7 April between Prime Minister Tony Abbott and his Japanese counterpart, Shinzo Abe.
Japan is a significant Western Australian trading partner with 48% of Australia’s total exports to Japan coming from Western Australia alone. In volume terms, 73% of Western Australia’s LNG went to Japan based on contracts in force in 2012.
Japan is already Western Australia’s largest market for LNG, second largest for iron ore and third largest for nickel. While iron ore and gas currently enter Japan duty free, Japan will eliminate tariffs for all remaining resource products over the next ten years.
“This is an important step for the competitiveness of Australian resources exports. It will not only benefit resource exports, many of which are already tariff free, but will particularly impact commodities struggling with increasing costs, who need the tariff elimination”, said CME Chief Executive Reg Howard-Smith.
Tariffs on nickel, ferro alloys, petroleum oils, aluminium hydroxide, titanium dioxide and coking coal will also be reduced or eliminated under the EPA. More broadly, the EPA will deepen Australia’s engagement in resources with Japan, the world’s third-largest economy. Energy and minerals account for 89% of Japan’s imports from Australia.
“The Australian Government should be congratulated for capitalising on our geographical location, providing further opportunities for Australian businesses and delivering a cost reduction solution for Australia exporters”, said Mr Howard-Smith.