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U.S. demands more work before TPP talks

Kyodo

The U.S. has welcomed Prime Minister Shinzo Abe’s declaration that Japan intends to join the Trans-Pacific Partnership trade talks, but noted that more work needs to be done to win Washington’s approval.

“The United States welcomes Prime Minister Abe’s important announcement formally expressing Japan’s interest in joining the TPP negotiations,” Deputy U.S. Trade Representative Demetrios Marantis said Friday.

“Since early last year, the United States has been engaged with Japan in bilateral TPP consultations on issues of concern with respect to the automotive and insurance sectors and other nontariff measures, (while) also conducting work regarding meeting the TPP’s high standards,” Marantis said.

“While we continue to make progress in these consultations, important work remains to be done,” he noted. “We look forward to continuing these consultations with Japan as the 11 TPP countries consider Japan’s candidacy for this vital initiative in the Asia-Pacific region.”

The American automotive sector is especially wary of Tokyo’s participation in the U.S.-led TPP discussions, fearing an influx of cheap Japanese cars will hurt the industry while the market in Japan will likely remain closed off.

Meanwhile, the USA Rice Federation issued a statement Friday urging Japan to include all sectors, including rice, in the TPP discussions on tariff elimination.

Two experts at the Center for Strategic and International Studies think tank in Washington — Matthew Goodman and Michael Green — noted in a recent commentary that “adding a large and complex country like Japan to the negotiating table at this date could slow the progress of the talks.”

Still, Washington and Tokyo should move toward Japan’s participation in the multilateral trade liberalization talks by addressing domestic concerns, they said.

“Without Japan in the TPP, the (President Barack) Obama administration’s ‘pivot’ to Asia and ‘Abenomics’ would both be substantially diminished,” Goodman and Green said, referring to the Abe government’s economic policies.

“With so much at stake and relatively few areas of actual disagreement in the way, it is incumbent on both leaders to seize this historic opportunity,” they concluded.

In Japan, major business lobbies welcomed Abe’s TPP announcement, but farmers and medical groups blasted the move.

“The swift decision to join the negotiations is the fruit of the prime minister’s strong leadership and negotiating power, and we evaluate it highly,” said Hiromasa Yonekura, chairman of Keidanren, a lobby group that represents automakers, electronics producers and other corporate behemoths. In a statement, Yonekura also said he hopes the government will be actively involved in the rule-making process to safeguard Japan’s interests.

Since the Pacific Rim trade initiative is expected to spark deregulation and open up new markets for exporters, many industry leaders support Japan’s participation in the TPP framework.

But the head of the powerful Central Union of Agricultural Cooperatives, Akira Banzai, said in a statement that it is “completely unacceptable that the prime minister has gone ahead with the announcement too hastily,” while substantial public concerns remain.

The farm body has long opposed Japan’s joining the trade talks, saying the abolition of tariffs would damage the farming sector by opening the flood gates to cheap imports.

“On behalf of farmers nationwide, I protest with strong anger,” Banzai said, urging the government to “promise the public it will withdraw from negotiations once it determines national interests cannot be protected.”

Farmers up and down the country also disagreed with Abe’s decision.

Shoichiro Takahashi, 44, whose rice paddy in Ishinomaki, Miyagi Prefecture, was submerged by the 2011 tsunami, said reconstruction should come first before joining such talks. “Looking from the viewpoint of the disaster-hit areas, reconstruction still has a long way to go,” he said. “We haven’t regained enough strength to compete with (farmers) abroad.”

The Japan Medical Association, which is concerned about the damage the TPP might cause to the domestic health insurance system, also released a statement saying the government “should have the option to swiftly withdraw from the negotiations in the event it decides it would be against Japan’s national interest.”