Minasama, ohayō gozaimasu.
It’s a great honour to be with you in Chiba.
Few nations are as close as Australia and Japan –
Which means few events on our economic calendar mean as much to us as this one.
The experience and knowledge in this room are a testament to our relationship, and I thank you all sincerely for being here.
I know I will meet with many of you directly, but I wanted the opportunity to be among so many distinguished friends in one place at this 63rd annual conference.
In particular, I thank the Chairs of the Business Co‑operation Committees that have brought us together today, Mr Michiaki Hirose and Mr Peter Grey –
His Excellency Kazuhiro Suzuki, Ambassador to Australia –
His Excellency Andrew Shearer, Ambassador to Japan –
Governor of Chiba Prefecture, Mr Toshihito Kumagai –
House of Representatives Member, Mr Takayuki Kobayashi.
And a delegation of fellow Australians and Australian companies, and the Business Council of Australia.
Over the next 2 days I will meet with more than 30 CEOs, business leaders and investors –
From some of the most important companies, banks, trading houses and industrial conglomerates in the world.
Combined, the investors I’m meeting have more than $4 trillion AUD under management –
That makes this a welcome and unique opportunity to forge new friendships, strengthen existing ones, and to discuss everything Australia has to offer as a partner and as a prime investment destination.
Economic relationship and bridge of friendship
There are so many reasons why Japan’s success is Australia’s success.
You are our third‑largest trading partner –
Second‑largest source of direct foreign investment –
And second‑largest export market.
Our two‑way trade of almost $100 billion – more than ¥10 trillion – ties our nations closer than our predecessors ever could have imagined.
These are all important reasons for our engagement this week.
But I’m especially honoured to be here to mark the 50th anniversary of our Basic Treaty of Friendship and Cooperation.
We celebrated this milestone in Australia’s Parliament House in June. I spent time with Takashi Horie of Mitsubishi and Takashi Yamamura of Mitsui that night, and it’s wonderful to see them again today.
The treaty is the foundation of all we’ve achieved –
Our decades of shared prosperity, opportunity, and close friendship –
Built on common values and a commitment to peace in our region.
During the early days of those treaty negotiations, Japan’s Prime Minister Kakuei Tanaka welcomed Australia’s Prime Minister Gough Whitlam to Tokyo, by declaring they were building ‘a bridge of friendship across the equator.’
Many of the challenges they faced are familiar to us today –
An oil shock, high global inflation, and tumultuous financial markets.
But over those 50 years we have built something enduring.
Ours is a trust built patiently and intentionally.
And in the next 50 years, that trust will be worth more than any cargo or commodity.
The stakes in 2026 are higher than in 1976, but the opportunities are greater as well.
That’s why the bridge of friendship that Tanaka spoke of is even more important today –
And why everything we are doing to make it even stronger matters so much.
Our challenges
We all know the challenges we face.
The risks and opportunities of artificial intelligence –
Transitioning energy systems in a decarbonising world –
Industrial and demographic transformations –
And a more fragmented, dangerous geopolitical context.
The Middle East conflict is intensifying volatility in global energy markets.
Oil prices are rising again, refinery disruptions are contributing to global diesel shortages and LNG prices have increased by over 150 per cent this year.
Global inflation remains high and markets are expecting interest rate rises in every major advanced economy.
Massive AI investment is increasing competition for capital.
All this is pushing up bond yields across the world.
In the past month, Australian 10‑year yields reached a 15‑year high.
American 10‑year yields reached a 24‑year high.
And as everyone here knows, Japanese 10‑year yields reached their highest in 3 decades.
None of us are immune to the impact of rising yields.
Even a country like Japan, with its substantial assets, will have to reckon with higher financing costs.
And although Australia has lower debt than every G7 country, rising interest costs will have a substantial impact on our next budget update later this year.
The global rules‑based trade system that has served our countries so well is fracturing.
American tariffs are the highest they’ve been since the 1940s.
Over 18,000 discriminatory trade measures have been introduced this decade –
Two‑thirds of global trade is now subject to regulations –
And more conflicts are being waged between countries than any time since the Second World War.
Outcomes and opportunities
Despite all this upheaval, our nations are well placed to succeed in the decades ahead.
We already work closely through forums like the G20 and APEC –
And our commitment to peace and prosperity in the region means we will only grow closer.
Australia has an enormous amount to offer.
We are a reliable, responsible middle power with strong economic foundations and unique strengths:
Abundant renewable and traditional energy resources –
World‑class critical mineral deposits –
A digital hub in the Indo‑Pacific –
That is stable and secure –
And with one of the world’s deepest capital pools.
All this provides opportunities to expand our areas of collaboration, cooperation and investment.
Boosting investment and economic resilience
Today I can announce that Australia and Japan have just signed the Strategic Financing Memorandum of Cooperation –
Bringing our public finance institutions including Export Finance Australia and the Japan Bank for International Cooperation together to seize new opportunities.
Later today, my good friend Minister Katayama and I will convene the inaugural Australia–Japan Finance Ministerial Dialogue.
There, we will make further announcements about how we will strengthen investment cooperation between Australia and Japan –
Focusing on economic resilience and secure supply chains, energy and fuel security, housing, critical minerals and digital infrastructure.
We will build on our existing efforts to bolster resilience and resist economic coercion.
Earlier this year, our leaders signed 4 agreements to strengthen our economic security, including the Australia–Japan Joint Declaration on Economic Security Cooperation.
Because being reliable trade partners, cooperating on joint investments, and diversifying critical supply chains –
Means strengthening both our nations’ sovereignty.
Energy
Australia is Japan’s largest source of energy, and we are enhancing our fuel security in new and traditional areas.
From the Northwest Shelf, where Mitsubishi and Mitsui have been partners for decades –
To INPEX’s Ichthys LNG project near Darwin –
Japan has long been a key investor in Australia’s traditional energy sector.
That investment is helping shape our future energy, too –
In renewables, hydrogen and ammonia, and the LNG to firm it.
From Marubeni and BHP’s contribution to the Port Hedland green iron project –
To Mitsui & Co.’s investment in the Yuri hydrogen‑to‑ammonia project in Western Australia.
Australia has the potential to produce cheaper renewable electricity than Middle Eastern or Russian renewables in 2050 –
And Japan has no energy provider more loyal than Australia.
For decades, we have been a dependable partner.
That will never change.
That’s why we will continue working with you on areas of interest, like our gas reservation.
Cheaper gas for domestic use and shielding our economy from international shocks are priorities, but so is providing Japan the gas it needs.
Many of the organisations here have worked with us on the design of the reservation, and I thank you for your cooperation and goodwill.
Critical minerals
Energy is a bedrock of our relationship, but we have huge opportunities in other areas too.
Rare earths and critical minerals are the raw materials of our future prosperity.
Australia holds the world’s second‑largest reserves of lithium, the fourth‑largest of manganese and the third‑largest of rare earths needed for AI and clean energy.
Our significant production of heavy rare earths is anchoring diversified global supply chains.
Together, we are securing those supply chains for each other and our partners, while reducing exposure to shocks.
Another agreement our leaders signed in May was the Australia‑Japan Joint statement on Elevated Critical Minerals Cooperation.
We are already seeing the benefits.
One project identified in the statement, Lynas Rare Earths, now has a minimum price floor with its Japanese off‑takers –
Providing certainty in volatile global markets.
Another, the Alcoa‑Sojitz gallium recovery project, recently broke ground.
These opportunities will only grow given Australia’s leading role in critical minerals –
Through our production tax incentives, $5 billion Critical Minerals Facility, and membership of the G7 Critical Minerals Resilience and Production Alliance.
That positions us to meet the growing demand for these resources as the industries of the future dependent on them expand – including in AI and clean technology.
AI and digital infrastructure
AI is the most significant economic transformation in our lifetimes and will help lift productivity in advanced economies like ours.
The AI investment boom provides enormous opportunities.
Japanese technology and manufacturing combined with Australian resources, land, capital and expertise are helping secure the benefits of the boom in both economies.
AirTrunk is one example of an Australian‑headquartered company investing in Japan’s digital future.
Its TOK1 data centre in East Tokyo has secured ¥192 billion in green loan support, the largest data centre financing in Japan’s history.
We’re finding ways to encourage even more two‑way AI investment while managing and minimising the risks.
Australia is one of the world’s top 10 markets for data centre capacity and we are developing world‑leading AI standards that will help provide long‑term policy certainty to investors.
Here I acknowledge Japan’s leadership on AI safety too.
The Hiroshima AI Process framework is a vital step for safe and responsible AI use in our region and the world –
While the Australia‑Japan Strategic Cyber Partnership is enabling deeper cooperation on cyber security challenges, including in AI.
Defence
Our shared national and regional security interests are opening new industrial opportunities too.
Japan’s industrial capabilities are world‑leading and that extends to your defence industry.
Our selection of Mitsubishi Heavy Industries’ Mogami‑class frigate is a vote of confidence in your capabilities here.
It demonstrates the practical value of our strategic alignment – connecting our industrial bases through technology, supply chains, specialised skills and new business opportunities.
But those business opportunities extend beyond defence, as Australian and Japanese investors know.
Superannuation and investment partnerships
Superannuation is a key pillar of Australia’s retirement system and it offers an enormous capital pool to be invested at home and abroad in the search of strong returns for members.
It’s the fourth‑largest pool of private retirement savings in the world – around $4.8 trillion – and could be the second largest by the 2030s.
Japanese capital market and corporate governance reforms are creating an increasingly attractive long‑term investment destination for that capital –
Giving us both a stake in superannuation’s success.
Our government is helping grow the pool through a range of reforms, providing better retirements for our citizens.
Both of our world‑class asset management sectors are another source of opportunity.
Macquarie has celebrated more than 25 years in Japan and IFM Investors has notched up 10.
The Sakura Fund collaboration between Main Sequence Ventures and Daiwa Corporate Investment was announced in August.
The latest data shows large super funds are investing hundreds of billions around the world in equity and infrastructure.
Increasingly, funds like Australian Retirement Trust are moving into Japanese stocks, attracted by the strong profits of innovative Japanese technology firms.
Japan has been our sovereign wealth fund’s third highest country exposure in recent years, at around $20 billion.
And last year Japan became Australia’s fourth largest destination for total investment at almost $180 billion.
Regulatory reforms to boost investment
Japan was Australia’s second largest source of approved commercial foreign investment in 2024–25 at $15 billion and consistently ranks in our top 10 sources of commercial investment proposals.
We are building on that and making it easier to invest in Australia by streamlining and strengthening our foreign investment framework.
We are making low‑risk investment more straightforward and higher‑risk proposal processes stronger.
The benefits for Japanese investors are clear: faster assessments, more certainty and simpler rules.
Making it easier to invest in Australia and protecting our national interests are not mutually exclusive – they’re the same thing.
At the same time, we’re delivering a comprehensive reform package to reduce unnecessary regulatory burdens across our economy –
Cutting regulatory costs by an estimated $10 billion per year.
Whether it’s making investment easier, our supply chains stronger or our economies more secure – Australia is taking bold steps.
Shared opportunity
All of this we’ve talked about today is about ensuring Australia and Japan can prosper together amidst all of this global economic uncertainty.
Australia is open, stable and serious about our long‑term partnerships.
The bridge of friendship our predecessors envisioned is paying dividends.
Our task is to make that bridge even sturdier, so it may withstand the rising tides and sweeping currents of our time.
Building on half a century of cooperation –
And looking to the half a century ahead.
The challenges we face are real, but the opportunities are enormous, they are endless, and that’s why I am optimistic.
For Australia’s future, for Japan’s future –
And the future of an even closer and more prosperous friendship between 2 wonderful countries.
Thank you.