Remarks - Launch of the report 'Japanese Investment in Australia: A trusted partnership'
I am delighted to launch Austrade's report Japanese Investment in Australia- A Trusted Partnership today.
This report recognises and celebrates the significant role of Japanese investment in Australia. It reinforces the clear message that Australia welcomes productive foreign investment, consistent with our national interest, from around the world, including Japan. While recognising the long history of our investment relationship, importantly, it looks to the future and to new areas of investment cooperation emerging with Japan.
The launch coincides with the 60th anniversary of the Agreement on Commerce signed by our two countries in July 1957.
This agreement set the foundation for closer bilateral ties between Japan and Australia, one built on trust, shared values and common approaches to economic cooperation.
The agreement had its critics, but it was a clear sign that Sir Robert Menzies' Government recognised a strong trade and investment relationship with Asia would be a key driver of Australia's future prosperity.
Some of Australia's largest export industries in resources and energy, such as iron ore, coal and LNG, were underpinned by significant and sustained Japanese investment. Think of the opening up of the riches of the iron ore of the Pilbara, the coal of the Bowen Basin and the LNG of the North-West Shelf.
Long-term purchase contracts by Japanese buyers, in particular, from trading houses, major Japanese steel mills and power companies, were a catalyst for Australian and other international joint venture partners to invest in these multibillion dollar minerals and energy projects.
These large and complex resources and energy projects have driven regional development, created tens of thousands of jobs for Australians, and generated billions in export income.
They also fuelled the rapid industrialisation of Japan, boosting prosperity for the people of Japan and bringing our countries ever-closer through shared commercial, political, strategic and people-to-people links.
Today, Japan is our second largest export market and second largest source of foreign direct investment after the US – and its investment in our country continues to grow.
The report highlights that from 2010 and 2016, the stock of Japanese direct investment in Australia increased by 78 per cent to over A$91 billion.
In terms of reinvestment, Japanese companies lead the way. They invested around A$4 billion in 2016 into Australian subsidiaries, greater than reinvestment from UK and US companies. As these Japanese companies maintain an ongoing presence in Australia, their investments are diversifying into new sectors.
In innovation and technology, Australia continues to be an ideal testing ground for Japan's R&D, and a platform for expansion into other Asian and Western markets.
NEC and Fujitsu representatives are here with us today and they have both established major R&D hubs in Australia which are an integral part of technology solutions. These hubs also tap into Australian talent, and look to the jobs of future in the tech sectors.
We are also seeing major Japanese companies invest in Australia's services sector and in manufacturing.
Services are an important part of the Australian economy and equates to around 75 per cent of our GDP.
I am delighted to be here today at Oji Fibre Solutions soon-to-be-completed world-class manufacturing facility, the result of A$72 million investment that will create more than 70 jobs by 2019.
Oji Fibre Solutions' new facility is a good example of innovation that will introduce new manufacturing technology, opening up new prospects for food exporters in Queensland, the Northern Territory and New South Wales.
Set to operate with a 5 star Green Star environmental rating, it will consume less water and electricity than comparable packaging companies.
Oji's packaging technology enhances Australian exporters' premium goods offering to high-end consumers in Asia, by ensuring the goods arrive in pristine condition. That means this Japanese investment not only creates jobs directly in the facility, but also boosts the chance for more jobs in the high-end food production sectors in Australia.
Investments such as Oji's are a very real example of how the Japan-Australia Economic Partnership Agreement (JAEPA), or the Japan-Australia FTA, is delivering prosperity and jobs around our country.
By providing better access for Australian agribusiness and food and beverage exporters, JAEPA delivers not just benefits for primary producers – and we are proud that Australia is the only major agricultural exporter to have a high-quality FTA with Japan - but is stimulating new rounds of business investment with jobs during the construction phase and new manufacturing jobs on an ongoing basis
So I would like to congratulate Oji Fibre Solutions for their foresight in establishing this state- of-the-art manufacturing facility.
It is yet another example of the many and varied ways our two countries cooperate in commerce, for mutual benefit. Please accept my best wishes for the success of this venture and for the further development of your links within Australia.