Taking the Australia-Japan FTA negotiations to new levels

[Originally posted, with full hyperlinks, at http://eastasiaforum.org/author/lukenottage/]
As we know from postings to the East Asia Forum, especially by Peter Drysdale, Hadi Soesastro and Hugh White, it was not clear what Prime Minister Kevin Rudd had in mind when, on 4 June before his first trip to Japan, he proposed a better regional architecture for the Asia Pacific region. Views differ even further about whether such reforms are politically feasible.
Some, particularly in the mainstream media, interpreted him as proposing some European Union-like institutions for the Asia-Pacific. The analogy is not necessarily a bad one, and it’s time to take this idea more seriously. After all, the EU has emerged from small beginnings back in 1958, and is itself still a work-in-progress. Yet regional arrangements have many advantages. They can generate more transparency and public participation, and hence legitimacy, than multilateral systems. They can also minimise parochial impulses often found in national and even bilateral approaches. Such impulses may also threaten the free-trade agreement (FTA) being negotiated between Australia and Japan.

Regional arrangements need not replicate all the “hard law” and supporting institutions gradually built up into the EU. But the Asia-Pacific could institutionalise more regulatory cooperation, for example in setting the minimum product safety standards permitted under the WTO. The head of the new “Consumer Agency” mooted now for Japan could join the New Zealand minister on our ministerial council for consumer affairs. In specific areas, such as food regulation, we could add other countries like Japan and China to the agency that Australia has developed jointly with New Zealand. We could add looser commitments to other business law harmonisation, as Australia and New Zealand did in 1988 following its FTA of 1982. That also underpins their negotiations for a treaty allowing readier enforcement of judgments from each others’ courts, as among EU states. We don’t need to bind ourselves yet to a supranational court like the European Court of Justice.
Softer innovations like these might restore more genuine sovereignty than we have now under the WTO or the lopsided Australia-US FTA. They should also undermine the objection that Australasia remains too diverse to take collaboration to new levels. Diversity has anyway been turned into a strength within the EU, now with 27 countries of all shapes and sizes (plus 3 more candidates, including Turkey).
More collaboration in regional initiatives could help Japan finally get over the dark legacy it left in the region during World War II, like the EU did for Germany. Former PM Paul Keating also over-exaggerates Japan’s “mono-culturalism and insularity”. The week before his remarks to the Australian media, Japan’s Supreme Court declared unconstitutional aspects of the Nationality Law, benefitting thousands of children of mothers particularly from South-East Asia. Indeed, Australia should learn from Japan how a Bill of Rights can be entrenched in a Westminster-style democracy.
Former PM Bob Hawke was also reportedly sceptical. Yet he, too, acted unexpectedly when proposing what became Asia-Pacific Economic Cooperation forum in 1989. Officials, politicians and other leaders still managed to make that work. But after two more decades of closer integration in our region, it’s time to consider adding some lessons from the EU.
Based on: “PM Takes Our Japan Trade to New Levels” Australian Financial Review, Friday 13 June 2008, p. 73.

Author: Luke Nottage

Prof Luke Nottage (BCA, LLB, PhD VUW, LLM LLD Kyoto) is founding co-director of the Australian Network for Japanese Law (ANJeL), Associate Director (Japan) of the Centre for Asian and Pacific Law at the University of Sydney (CAPLUS), and Professor of Comparative and Transnational Business Law at Sydney Law School. He specialises in international dispute resolution, foreign investment law, contract and consumer (product safety) law.

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