TOKYO

Japan-Australia Relations
Attached for your information is a copy of a translation of an
editorial which appeared in the economic newspaper 'Nihon Keizai'
on 20th June, 1957.

IMPROVING JAPAN/AUSTRALIA RELATIONS
A series of bright and heart-warming news has appeared in the
recent issues of local papers in connection with Japan/Australia
relations. Last April, Australian Prime Minister Menzies visited
this country as a State guest, exchanged frank opinions with our
Premier, Kishi and naturally, both elites deepened mutual
understanding. One of the outcomes of Menzies/Kishi conference is
the scheduled release of all Japanese prisoners being held by the
Australian side by the end of this month. Now, the latest report
says that the protracted Japan/Australia trade conference has
finally come to an agreement and to give it the finishing touches,
Mr McEwen, Australian Trade Minister, is arriving here very soon.

Japan and Australia are located geographically near while
Australian wool is woven into our wear. Considering these,
relations between both parties should have been much more
friendly. An indifferent attitude towards each other which has
long existed between the two people is said to be connected with
the so-called 'White Australia' principle and a suspicious
attitude of Australians towards Japanese. After a lapse of 12
years since the termination of the war, however, Australia's
viewpoint about Asia as well as its feeling towards the Japanese
have changed. It is also undeniable that Mr Menzies' recent visit
contributed not a little to the improvement of Japan/Australia
relations.

Meanwhile, it should be particularly stressed that the Australian
Government took a constructive attitude towards the conclusion of
the Japan/Australia trade negotiations. The Australian side has
been placing special restrictions on the 36 Japanese items
including textiles and sundries which otherwise might have formed
the main body of Japan's exports to that country. Furthermore,
Australia has been imposing the highest import duties on other
Japanese commodities. Naturally, trade between both parties was
considerably lop-sided with the Japanese account running into the
red every year. Sooner or later, Japanese imports from Australia
would be doomed to a sharp cut unless the latter stops its
discrimination against Japan. However, at the recent trade talks,
Japan promised to apply the most-favoured-nation treatment for
Australian soft wheat imports which had been restricted because of
the Japanese obligation to accept American surplus under the US
Farm Produce Disposal Act.

Now, on the whole, it is considered to be only reasonable that
Australia stepped up to the Japanese requests at the trade talks.

As a matter of fact, however, some international problems are not
necessarily soluble by only common sense. In lifting its
discriminative steps against Japanese commodities which have been
in force for these 50 years since the founding of the country, it
is no doubt that the Australian Government faced a number of
obstacles and oppositions. In spite of these difficulties, the
Australian Government dared to extend the most-favoured-nation
treatment to Japan and kept promise clarified in the Kishi/Menzies
joint announcement. This very fact is certain to have a favourable
effect upon future Japan/Australia relations.

In the meantime, it is recalled that Canada agreed to extend its
most-favoured-nation treatment to Japan in 1954, and in two years,
Japanese exports to Canada increased by more than three times.

This also brings an optimistic view to the Japanese about future
exports to Australia. In preparing for such a possible 'export
boom', however, it should be kept in mind that a deep-rooted
cautious sentiment towards Japan is still lingering in Australian
minds. Rush exports to Australia of the 'cheap and bad' will only
give rise to moves in that country to oust Japanese commodities.

According to recent reports, some Australian manufacturers of
textiles and radios are strongly opposing extending the most-
favoured-nation treatment to Japan. Local trading circles should
work out concrete steps for the establishment of orderly export
systems so as not to be ousted from the promising export market.

Also important is that the Japanese people to correct their
prejudice about Australia. Most Japanese consider that it is a
'country of sheep and wheat'. Actually, however, Australia is now
pushing its industrialisation programme on a large scale and to
meet strong demand for power and also to increase agricultural
output, the Snowy Mountains and other gigantic exploitation plans
are under way. Under these circumstances, Japanese exporters are
requested to switch their trade policy towards Australia and to
place stress on exports of such exploitation materials and
machinery rather than on consumptive goods.