What Tony Abbott and Shinzo Abe's Australia-Japan Free Trade Agreement Means for Australians

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July 9, 2014 1:30 PM EST

Australian Prime Minister Tony Abbott and Japanese leader Shinzo Abe are getting ready to sign an Australia-Japan Free Trade Agreement in July 2014.

REUTERS/Stefan Postles/Pool
Japanese Prime Minister Shinzo Abe (L) and Australian Prime Minister Tony Abbott exchange documents after signing the Japan-Australia Economic Partnership Agreement and Agreement on the Transfer of Defence Equipment and Technology, in the Mural Hall at Parliament House in Canberra

The agreement poses a lot of opportunities and financial advantages for both countries such as reduction in costs of Japanese cars, food products as well as electronics and machines. The last time a Japanese leader had an official visit to Australia was in 2002. The agreement is set to be signed by the parties in Canberra.

Here are some things that Australians can expect from the deal.

1. Cheaper Japanese goods

The Free Trade Agreement will provide valuable preferential access to Japan's giant economy. As a result, Australians may enjoy cheaper costs of appliances, electronics and other Japan- made products. Since Australian consumers buy a lot of goods from Japan, the deal will help boost savings as well as allow Australians to afford necessary equipment and state-of-the-art creations.

2. Holidays are cheaper

Since products are a lot cheaper, Australians can expect to spend less money despite acquiring the same number or more goods. As the Japanese market opens to Australian consumers, consumers can gain access to a variety of Japanese brands at a much lower rate especially in the holiday season.

3. More food

Australian producers of beef and dairy products can also expect significant growth as the Japanese market boosts their orders of frozen beef, ice cream, yogurt and milk. Tariffs on canned goods like pears, tomatoes and peaches will be eliminated so both suppliers and consumers can enjoy bigger savings and income.

4. More duty-free entries

Australians exporters used to enjoy duty-free entries on products like iron, coal and liquefied natural gas. With the Free Trade Agreement between Abbott and Abe, other resource products like coke, titanium dioxide, nickel, petroleum oils and many more will also enjoy duty-free entries. Exporters can enjoy larger profit margins in the long run.

5. Military assistance

Both countries can further help each other in relief operations as well as defense and military exercises via a visiting forces agreement. Both nations can enjoy upgrades and access to training programs to enhance their military power and capabilities.

(Photo: REUTERS/Stefan Postles/Pool / )
Japanese Prime Minister Shinzo Abe (L) and Australian Prime Minister Tony Abbott exchange documents after signing the Japan-Australia Economic Partnership Agreement and Agreement on the Transfer of Defence Equipment and Technology, in the Mural Hall at Parliament House in Canberra
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