WASHINGTON – The nominee for top U.S. trade representative indicated he would urge Japan to expand U.S. access to its auto market through negotiations for the Trans-Pacific Partnership.
Mike Froman told a congressional hearing Thursday that the U.S. government has regarded domestic calls for expanded access to the Japanese market through reduction in nontariff barriers as “a central focus” during preparatory talks toward Japan’s joining the TPP negotiations.
Froman, who now serves as deputy security adviser for international economic affairs to President Barack Obama, made the remarks during a hearing of the Senate Finance Committee.
Froman also said the TPP gives the United States the opportunity to protect its gains in the auto industry and build on “that strength going forward.”
“My view is that it is better to accept no agreement than a bad agreement,” Froman told the committee.
Japan imposes no tariffs on imported automobiles. But the United States has demanded Tokyo address nontariff barriers associated with transparency and regulations in order to help increase U.S. auto exports to Japan.
During the hearing, committee members also mentioned the yen’s depreciation against the dollar and currency manipulation by foreign governments as well as the need to add punitive measures against currency manipulation in the TPP deal.
Froman did not elaborate but said he will work with the Treasury Department and with all lawmakers to “determine how best to move forward on that.”
Meanwhile, 230 U.S. representatives sent a letter to Obama on Thursday, demanding rules against currency manipulation be included in the TPP.
“It is imperative that the agreement address currency manipulation,” the letter says.
Although the letter does not directly mention Japan, it apparently reflects the U.S. auto industry’s argument that Japan is aiming to expand auto exports via the yen’s weakening. Japan will debut in TPP talks in July.
The 230 lawmakers said in the letter that “in recent years, currency manipulation has contributed to the U.S. trade deficit and cost us American jobs.”
Also on Thursday, the American Automotive Policy Council, a key auto industry lobby, issued a statement urging Congress to take action against currency manipulation.
“To avoid locking in one-way trade and rewarding currency manipulation, the TPP must require Japan to fully open its market to competition and include currency rules to prevent subsidies for Japanese automakers,” the AAPC said.
The Office of the U.S. Trade Representative has so far been cautious about including a clause authorizing sanctions against currency manipulation in the TPP pact.