Japan should start early talks with the United States, European Union, China and South Korea on abolishing trade barriers so it doesn’t put itself at a competitive disadvantage, the head of a panel at the Japan Business Federation (Nippon Keidanren) said.
Yoji Ohashi, chairman of the committee on promoting economic partnerships for the nation’s largest business lobby, said in a recent interview with The Japan Times that he is looking to help the long-protected farm sector become competitive.
“I’m worried that Japan will be left behind if it does not move forward with economic partnership agreements and free-trade agreements with the U.S., EU, China and South Korea,” said Ohashi, who is also chairman of All Nippon Airways Co.
Ohashi said he was worried by South Korea’s aggressive stance on free trade. South Korea’s FTA with the EU will take effect in July and it is also negotiating a similar agreement with the U.S.
“Japan may be left behind in the auto sector, electronics sector and all other sectors when it competes with South Korea,” he said.
The comments followed Prime Minister Naoto Kan’s Cabinet decision Tuesday to approve the start of consultations with members of the Trans-Pacific Partnership Agreement before the Asia-Pacific Economic Cooperation forum summit this weekend in Yokohama.
The government, which hedged its TPP position so it can gather more information, said it will make an official decision on whether to join the TPP talks by June. South Korea, China and the EU are not members of the TPP.
Ohashi said Tuesday’s step represented a “a step forward” for the government, which is already facing strong opposition from farmers.
Ohashi will attend one of the panel discussions at the APEC CEO summit Friday, where he and other business leaders are likely to discuss free trade.
He also said Japan’s farm sector cannot stave off global competition and Keidanren will help make agriculture more successful as a business, for example, by creating joint-stock farming companies.
Some of the Keidanren’s member companies may also have a couple of things to teach the farming sector, he said. For example, in 2008, retailer Ito-Yokado Co. set up a corporation to run a farming business. And temp staff agency Pasona Group Inc. has been running agriculture business schools since 2005.
“There is something we can do about shoring up agriculture,” Ohashi said.
Free trade would also benefit the aviation industry, because it would spur further inflows and outflows of people and goods, he said.