Australian Prime Minister John Howard has begun his first visit to Ireland since winning government 10 years ago.
Mr Howard will have two days of meetings with politicians, students and business figures, including an address to the Dáil tomorrow.
He addressed the Irish business community at a lunch hosted by Dublin Chamber of Commerce and the Irish Business and Employers Confederation (IBEC), in association with Enterprise Ireland.
Mr Howard stated that Europe and Japan must reciprocate a US offer to ease trade restrictions in the latest round of world trade talks or face a decade-long wait to improve market access.
Outgoing US trade chief Rob Portman has pledged to cut the US. World Trade Organisation allowance for trade-distorting domestic subsidies by 60 per cent if other countries throw open their agricultural markets and cut tariffs by 55 to 90 per cent.
Mr Howard said he believed the current US offer to liberalise trade went further than most people expected. But he warned that "if there is not sufficient reciprocity from the European Union, from the Japanese and from others who are maintaining very restrictive approaches in a number of areas then the real danger is that the Americans will retreat from the current Congressional authorisation."
Addressing the lunch, Eugene McCague, Dublin Chamber president said: "Ireland is the sixth most important exporter to Australia from the EU. It is also a burgeoning tourism destination, with trips to Dublin expected to increase by about 10 per cent this year, partly due to the fact that Ireland is hosting the Ryder Cup."
Turlough O'Sullivan, IBEC director general, said: "The Irish were among the first settlers in Australia and contributed substantially to the development of contemporary Australian society. This close cultural connection has helped forge close economic ties and our commercial and investment links are growing rapidly."
Irish exports to Australia last year were valued at €734 million, while Irish imports from Australia totalled €131 million. Ireland's largest export to Australia in 2005 were chemical and pharmaceutical products valued at €310 million, followed by computers and other machinery valued at 189 million, and food and drink products valued at € 39 million.
Ireland's main imports from Australia in 2005 were food and drink products valued at € 56 million, followed by pharmaceuticals (mainly medical products) valued at €25.5 million, and computers and other machinery valued at around €16 million.
It is the last leg in a two-week trip that has taken in Washington and Chicago in the United States and the Canadian capital of Ottawa.
Two of Mr Howard's great-grandparents were born in Ireland, but he does not believe he has any living relatives in Ireland.