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FTA might ignore farmers

Daily Telegraph, Sydney

FTA might ignore farmers

By Sandra O’Malley in Aichi

April 21, 2005

AGRICULTURE might not feature in a free trade deal between Australia and Japan, with Prime Minister John Howard acknowledging it may be too big an obstacle to overcome.

Mr Howard conceded today, after the two countries agreed last night to begin a feasibility study on a free trade agreement, that agriculture remained the key stumbling block in a country in which it was the most highly protected sector.

"It’s a sensitive sector, culturally and politically, in this country," he said.

"I am a realist. I understand the political difficulties of beginning to unpick the levels of protection that have existed for a long time. We had those difficulties in Australia."

Labor launched an immediate attack, saying the proposed free trade feasibility study would be a waste of time if it was clear Japan would not agree to agriculture, without which a trade pact would be pointless.

"I think the Prime Minister has to insist on agriculture being in, it’s as simple as that," Opposition trade spokesman Simon Crean said.

Mr Howard met Japanese Prime Minister Junichiro Koizumi for talks in which it was agreed the two countries should study the pros and cons of a free trade agreement, but Japan indicated it may be many years before it would actually lead to a deal.

Mr Koizumi appeared lukewarm to the idea, saying Mr Howard well understood that there were "tough challenges" ahead.

The talks followed a memorandum of understanding between Australia and China, also paving the way for the start of negotiations on a free trade agreement.

While Australia has termed the Japanese study as a feasibility report, Japan has used the term "merits and demerits" to describe what it will actually examine.

However, Japan’s powerful farm lobby does not want unfettered access by other agricultural producers to the sector, which would prove lucrative to Australian farmers if it was ever liberalised.

Mr Howard told a news conference the feasibility study would look at all aspects of trade including agriculture.

But asked if a free trade deal could exist without agriculture, Mr Howard said "It’s too early to start talking about to what extent things are involved".

"We will be looking at every aspect including agriculture in the feasibility study," he said.

Mr Crean said there seemed little use spending vital resources on a feasibility study into a Japanese trade deal if agriculture was already off the table.

"Why would we be going down the path of a free trade agreement with Japan that excluded agriculture?" he asked on ABC radio.

"It’s not worth pursuing if agriculture is excluded because it not only disadvantages our agricultural products, it undermines our leadership at the Cairns Group and it therefore undermines the negotiations in the World Trade Organisation."

Mr Crean said Mr Howard had few alternatives.

"It’s a simple proposition and a fundamental test for John Howard," he said.

"What he has to do is argue some basic principles and that is we cannot agree to an approach to a free trade agreement that contains exclusions."

The Government was criticised last year for accepting a free trade deal with the US that excluded sugar after claiming earlier the sector had to be included.