Briefing on proposed Japan/Australia Free Trade Agreement
Negotiations
between Australia and Japan begun in April 2007 and have made slow
progress since. The upper house electoral defeat last year for the
Japanese government sent a clear signal that Japanese farmers fear the
social impacts of free trade agreements and that this restrains the
ability of the government to negotiate.
AFTINET has a number of concerns about the process for negotiations for a Free Trade Agreement with Japan.
Poor Economic Modelling
The
Australia - Japan Joint Feasibility Study predicts a net gain for
Australia's GDP of $39 billion over 20 years. This claimed economic
benefit is misleading as it is calculated on the basis that all tariffs will be removed across all
sectors. The Study admits that this economic modelling is a
"simplification of reality and relies on numerous assumptions." Given
the Japanese governments recent statements wanting the exclusion of
beef, sugar, wheat, rice, and dairy from the agreement the proposed
benefits have diminished even further.
Public Consultation and Impact Assessment
The
feasibility study conducted which concluded a Japan-Australia FTA would
bring economic benefits to both countries failed to include in its
modelling the social, cultural and environmental impacts of any
agreement. The failure to include such aspects paints only an economic
picture and does not provide the full account of the impacts of such an
agreement.
AFTINET
welcomes the ALP policy that "any agreement must be subject to
effective public consultation and a thorough Parliamentary process
capable of identifying the strengths and weaknesses of any proposed
agreement" (ALP Policy Platform, Chapter 3, pg 25).
Commitment to a ‘GATS-Plus' Outcome
AFTINET
is particularly concerned about the ‘GATS plus' commitment outlined in
the Feasibility Study. The definition of public services under GATS is
already ambiguous. Making a commitment beyond this is very
alarming as it would undermine the ability of governments to provide
and regulate essential services, determined through democratic
processes. We note that the ALP Policy Platform states that trade
agreements should not limit the capacity of governments to provide and
regulate essential services (ALP Policy Platform, Chapter 3, pgs 19
& 20).
AFTINET
is critical of the definition of public services used in the Thai Free
Trade Agreement, the US Free Trade Agreement and the WTO, because it
can exclude some public services which are supplied on a commercial
basis or in competition with another supplier. The current GATS rules
on domestic regulation already limit the ability of governments to
regulate, as demonstrated by the Mexican Telecommunications case and
the Antigua-US Gambling case.
Provisions on intellectual property (IP)
The
Feasibility Study suggests that both Australia and Japan should
"explore commitments beyond existing TRIPS obligations, including
measures to enhance cooperation on intellectual property". AFTINET
believes that an Australia - Japan FTA should not include IP
commitments that are more onerous that the existing TRIPS agreement.
Such commitments can unduly privilege the rights of the owners of the
copyright, trademark or patent over the rights of users, and can result
in price rises that restrict equitable access to medicines.
Control of Investments
Following
on from the concessions gained by the United States in the FTA with
Australia, Japan too is seeking a higher threshold for the review of
investment by the Foreign Investment Review Board. This would involve
increasing the threshold of investment in Australia to $800 million.
The raising of this threshold for US investors already undermines the
ability of Australia to determine whether or not investment is in
Australia's interest.
Energy Security
Japan
has asked that ‘energy security' be included in the negotiations for an
FTA. AFTINET is unsure what part this could play in an FTA as energy
supply contracts are made between private companies. Any negotiations
about energy must be based on the principles of Multilateral
Environment Agreements to reduce climate change impacts.
Negotiations
on a Japan FTA should not continue without an assessment of the impact
of the FTA on human rights, labour rights and the environment in both
Japan and Australia. Negotiations should not proceed without
comprehensive community consultation and parliamentary debate on these
issues.
