The rapid development of Japan's relations with Australia in the post-war era was based on mutually complementary trade links. Since then, the relationship has expanded to economic activities, politics, culture and various other fields. As trusted partners in the Asia Pacific region, Japan and Australia share a common interest in regional stability and prosperity.

Milestone events in recent years were the Joint Declaration on the Australia-Japan Partnership, which was issued during a visit to Japan by Prime Minister Paul Keating in 1995, and Japan-Australia Partnership Agenda adopted in the 14th meeting of Japan-Australia Ministerial Committee in August 1997.

From September 1996 through March 1998, Japan and Australia have held a series of events, the "Japan-Australia Friendship Anniversaries," to commemorate the significant milestones. In 1996 the two countries marked the twentieth anniversary of the signing of the Basic Treaty of Friendship and Co-operation between Japan and Australia, and in 1997 they observed the fortieth anniversary of the signing of the Agreement on Commerce between Japan and the Commonwealth of Australia, and the centenary of the opening of the Japanese Consulate-General in Sydney. In this connection, commemorative activities were taking place in Japan and Australia, including symposiums, sporting exchange events, and a variety of cultural events.

In the field of economic relations, Japan is Australia's largest trading partner and the third largest source of direct investment in Australia in terms of the cumulative total.