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New Japanese pact will not scupper China trade deal: Australia

CANBERRA — Australia’s agreements with Japan over security and commerce are not hampering efforts to strike a free-trade deal this year with China, its biggest economic partner, said Trade Minister Andrew Robb.

CANBERRA — Australia’s agreements with Japan over security and commerce are not hampering efforts to strike a free-trade deal this year with China, its biggest economic partner, said Trade Minister Andrew Robb.

Japan and Australia last week signed accords on defence technology transfers and tariff reductions, as Mr Shinzo Abe made the first formal visit to Australia by a Japanese prime minister since 2002.

Australian Prime Minister Tony Abbott is seeking to add trade agreements while balancing diplomatic ties with China and Japan, amid East China Sea maritime disputes. Australia has concluded deals this year with Japan and South Korea, which together with China buy more of the country’s iron ore, coal and other exports than the rest of its customers combined.

Discussions with a Chinese counterpart in recent days had offered no evidence that the deals with Japan have “had any impact on our relationship”, Mr Robb said yesterday in an interview with Sky News television.

Mr Abe, who said he had discussed with Mr Abbott attempts by China to “change the status quo” in the region, has faced criticism from Chinese President Xi Jinping over a reinterpretation of his country’s pacifist Constitution. Mr Abbott was chided in Chinese media over comments made during Mr Abe’s visit in which he described “the sense of honour” of Japanese soldiers during World War II.

“The agreement with Japan will benefit our farmers and our businesses,” Mr Abbott said yesterday in an e-mailed statement. Once the deal is implemented, 97 per cent of Australian exports to the world’s No 3 economy will receive preferential access or enter duty-free, while domestic consumers will benefit from cheaper car parts and household items, said the statement.

An agreement with China has become a greater economic imperative as the nation has increased trade with Australia by 77 per cent since 2009, and it is the biggest consumer of iron ore, Australia’s most valuable export. Two-way trade between the nations last year reached A$150 billion (S$175 billion), more than double the value of Australia’s partnership with Japan, its second-largest economic partner.

Tensions over trade with China increased after Australia’s previous Labor government, ousted in a September election, cited national interest concerns in its refusal to allow Huawei Technologies, China’s largest phonemaker, work on Australia’s A$30 billion broadband infrastructure project.

In March, Mr Abbott said he is seeking to finalise an accord with China this year. Yesterday, Mr Robb said: “We have still got quite a lot of negotiation to go, but I think we have settled on a framework that means we can achieve it in the time frame ... We are on the case and are still on track to conclude something significant by the end of the year.” Bloomberg

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