Japan is Australia’s largest coal customer, and Japanese coal demand is a key factor in the development of Australia’s coal export industry. Historically, Japan bought over half of Australia’s coal exports, and many mines are part-owned by Japanese companies.

Now, Australia is the second-largest exporter of coal in the world after Indonesia, and Australia’s exports of coal and gas combine to make it the third-largest exporter of greenhouse gas pollution, after Russia and Saudi Arabia.

Despite the impact of Australian coal on global markets and the global climate, it has a small impact on the Australian economy. Just 0.3% of Australian jobs are in coal mining — 99.7% of Australians do not work in the coal industry. The taxes and fees paid by the coal industry to all levels of government in Australia account for less than 2% of total government revenue.

While a small part of the economy, Australia’s coal industry has huge political influence. It makes large donations to political parties and also provides jobs to key politicians and their staff when they want to, or are forced to, leave politics. This movement of staff between mining lobby groups and political offices is often referred to as a ‘revolving door’ — politicians leave politics for jobs in mining, while mining lobbyists walk into political jobs.

In 2015, Australian coal exports to Japan grew by 28% in the preceding five years and official forecasts expected another 15% growth by 2020. Instead, 2020 levels are largely unchanged from 2015. Similarly, while Japanese coal demand had been expected to grow substantially, it has declined in recent years.

To address climate change, protect Australian biodiversity and water resources, and improve air quality and human health in Japan and Australia, Australian coal exports and Japanese coal consumption must be phased out. Numerous research programs have shown this can be achieved without major disruption to economies or energy systems.

With collaboration between Japanese and Australian communities, progress is possible to reduce the damage caused by coal mining in Australia and coal consumption in Japan. The aim of this report is to support this collaboration.