Koizumi visit will be food for thought

Australian leader John Howard takes a pragmatic view on relations with Japan

SYDNEY, Australia (CNN) -- Trade and regional security issues are expected to dominate a visit by Japanese Prime Minister Junichiro Koizumi to Australia and New Zealand this week.

Koizumi arrives in Canberra on Tuesday via East Timor, where he will be the first world leader to meet newly elected president, Xanana Gusmao.

Both Tokyo and Canberra are saying they are keen to build on the already strong relationship between the two nations, with talk of moves towards a possible free trade deal in the wind.

Japan is Australia's largest export market and has been the nation's number one trading partner over the bulk of the past 30 years.

Australia exports more than $13.7 billion of goods and services to Japan each year, including vast quantities of coal, iron ore, liquefied natural gas and beef. Japan sells back to Australia around $9.4 billion of mainly manufactured goods such as cars, office equipment and industrial machinery.

The biggest stumbling block to any liberalizing of trade between the two countries is the issue of Australian access to Japan's tightly regulated agricultural market.

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Australian exports of foodstuffs such as rice and beef to Japan are controlled by quotas and tariffs, a situation which infuriates farming groups and runs at odds with Australia's strong political commitment to free trade principles.

Some observers are suggesting Japan will wish to exclude agriculture from any trade liberalization proposals, something which will further antagonize Australia's free trade purists.

Australian Prime Minister John Howard, however, appears to be adopting a more pragmatic approach.

Speaking at the weekend, Howard said he welcomed Koizumi's reported remarks seeking a stronger economic relationship, saying he reciprocated those sentiments.

He said Koizumi had made "a very genuine and generic statement of a desire for a closer relationship", adding that his government was keen to work through the detail of achieving that.

Japan's desire to build on its ties with Australia are possibly driven by the nation's strong economic performance amid a world downturn.

Australia's economy grew at a 4.1 percent pace even late in 2001, at a time when the rest of Asia was mired in a slump.

New grouping

According to the Economist Intelligence Unit, Australia's economy is expected to grow around 4 percent in both 2002 and 2003.

With hopes of greater global initiatives towards free trade fading, Australia has been vigorously pursuing bilateral trade agreements.

While the nation's other major trading partner, the United States, has not come to the party, negotiations are progressing with Southeast Asian neighbors Singapore and Thailand.

Aside from trade, Koizumi and Howard will likely discuss regional security issues, global terrorism and responses to climate change.

Australia supports Koizumi's call to develop an East Asian grouping of nations that would include the ASEAN countries as well as China, Australia, New Zealand, Japan and South Korea.

The only sour note likely to be struck will accompany Koizumi's scheduled visit to Australia's War Memorial in Canberra on Wednesday.

War memories

A visit to Australia's War Memorial by Koizumi will upset some veterans

That gesture will bring protests from war veterans associations -- particularly as it comes so soon after Australia's April 25 ANZAC Day, which honors the nation's war dead, and Koizumi's controversial trip to Japan's Yakusuni war shrine last week.

Thousands of Australian forces were brutally imprisoned and killed by the Japanese during the Second World War following the fall of Singapore.

Koizumi will also visit New Zealand on Thursday and Friday, where trade issues and the East Asia grouping will also be on the agenda.

Japan is New Zealand's third-largest trading partner.

New Zealand Prime Minister Helen Clark said Monday she was interested in hearing more on Koizumi's thinking on the East Asia community and "how New Zealand might contribute".

She said New Zealand officials were working on building closer relations with Japan in five areas: tourism, forestry, education, the new economy and people-to-people links.