By Alfredo Guevara, Trade Finance Section, Investment and Economic Division, DFAT
The most interesting opportunities we get as DFAT officers are not always found behind a desk in Canberra. Earlier this year I had the opportunity to accompany Simon Newnham, Australia’s APEC Ambassador and First Assistant Secretary of the Investment and Economic Division, on a visit to Tokyo. As part of that visit, Simon addressed a Symposium hosted by Japan’s Research Institute of Economy, Trade and Industry (RIETI) and the Australian National University (ANU).
Simon spoke about the deep relationship between our two countries, tracing an arc from the 1957 Commerce Agreement, which established the cornerstone of our bilateral relationship, to the bold steps taken towards closer economic integration under the Economic Partnership Agreement (JAEPA), to the recent signing of the TPP-11 – a watershed moment for open markets.
Indeed, our shared goals are remarkably aligned. These goals were recently outlined in Australia’s Foreign Policy White Paper and Japan’s own Free and Open Indo-Pacific Strategy, particularly the welfare and stability of our Indo-Pacific region, underpinned by open economies and the rule of law.
Simon went on to outline that, while the outlook for our bilateral future was bright, there were some genuine reasons for concern. Protectionist trade policies are on the rise in some parts of the world and this has led some to fear the response might be damaging cycles of retaliation.
However, while these risks may be on the rise, there are some compelling arguments why things may not be as dire as they seem.
Despite the recent rise of protectionism, the global economic landscape remains strong and any sense some may have of a protectionist contagion is sometimes overblown. In fact, most people in Australia and elsewhere maintain a positive view of trade. We were also reminded that the consequences of a global shift to protectionism are well known and our knowledge and institutions mean we are better prepared.
Simon further emphasised that, while others may have stepped back, countries like Japan and Australia are stepping forward. The US withdrawal from the Trans Pacific Partnership was disappointing, but we pushed on together and will look to expand future membership of the TPP-11.
I think this highlights the importance of the work of our overseas Embassies, Consulates and missions in building and sustaining Australia’s key relationships abroad. It was also a particularly strong point to make to an audience in Japan. That is, in the face of challenges, like-minded countries have not shrunk back. Australia and Japan now need to maintain momentum progressing regional economic integration.
As Simon stressed, shared interest in protecting the global economic system means we need to capture momentum from the signing of the TPP-11 and look to shared leadership in the WTO, G20 and APEC (where the ‘habits of consultation’ over three decades see practical, voluntary and cooperative steps taken towards regional economic integration). This includes pursuing other quality trade agreements, including RCEP and the Pacific Alliance, with an eye towards an eventual Indo-Pacific wide FTA. I look forward to seeing these aspirations fulfilled as I progress in my career at DFAT.
The Ambassador’s remarks came at a particularly interesting and challenging time for the global trading system. An uptick in trade frictions, including robust global discussions underway on the implications of US tariffs on steel and aluminium, even as we boarded the plane, made clear this trip would be an interesting one.
The Symposium audience of some 150 attendees included local academics, government officials, Tokyo-based foreign diplomats, and members of Japan’s private sector. All were keen to hear what Japan and Australia would do to address some of the challenges to the global trade order.
Alfredo is a policy officer working on trade finance in the Investment and Economic Division at the Department of Foreign Affairs and Trade.