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Japan’s entry seen giving TPP talks weight, dynamics

Nations warmly welcome Tokyo's debut, see it as countermeasure to strong U.S. influence

by Sayo Sasaki

Kyodo

Japan’s entry into the Trans-Pacific Partnership free-trade negotiations has significantly boosted the economic scale of the envisioned pact, but it has also brought new complexity to the multilateral talks that have been strongly influenced by the world’s leading economy, the United States.

With Japan, which has the world’s third-largest economy, having made its belated debut as the 12th member near the end of the talks’ 18th round, TPP countries now account for nearly 40 percent of the world’s gross domestic product and about one-third of total world trade.

“As the countries see significance in terms of trade and economy, Japan’s entry was very much welcomed,” said Koji Tsuruoka, the country’s chief negotiator after the latest round wrapped up Thursday in Malaysia.

Given Japan’s economic size, some experts believe the negotiations will essentially become bilateral negotiations between the United States and Japan for establishing their own standards for a massive market at a time when China, a non-TPP member, is increasing its global presence.

Smaller participating states, meanwhile, are hoping to team up with Japan in countering the United States in the negotiations covering numerous fields, including the opening up of markets through the elimination of tariffs, and intellectual property protection rules.

A New Zealand trade official said the country welcomes Japan’s entry as it will bring more “dynamics” to the negotiations that have often been referred to as “U.S.-led,” despite members technically having an equal say.

“I think the Southeast Asian countries in particular have been waiting for Japan’s entry,” said a Japanese stakeholder after meeting his counterparts during the round.

“They are hoping Japan can help them push back the United States,” he said.

Other member states taking part in negotiations are Australia, Brunei, Canada, Chile, Malaysia, Mexico, Peru, Singapore and Vietnam.

While moves to team up are likely to accelerate as the countries work toward the target of concluding a deal by the end of the year, bridging the differences of the members at various stages of economic development is expected to be a difficult task, especially when it comes to each of their sensitive sectors.

Japan, for its part, plans to have its domestic interests reflected as much as possible after it jumped into the talks, now already over three years old, on Tuesday.

Forming economic partnerships to boost exports has been a key pillar of Prime Minister Shinzo Abe’s economic policies — dubbed “Abenomics” — as his government tries to help Japan out of the deflation that has plagued the country for years.

But the government is also tasked with protecting its agriculture sector, including the key products of rice, wheat, beef, pork, dairy products and sugar, which have long been protected through high tariffs.

Abe’s own ruling Liberal Democratic Party has adopted a resolution urging the government to protect the key items and not to hesitate to leave the negotiating table if it seems the talks will turn out otherwise.

Japan scrabbled to gather information and present its position from the first day of its participation by sending a delegation of nearly 100 members, knowing it could only attend three days of the round while needing to go through hundreds of pages of documents related to the negotiations it gained access to upon admission.

The delegation, including negotiators handpicked by Tsuruoka, who is experienced in a range of international negotiations, was unusually large among the roughly 650 officials from all 12 countries who attended the round.

Despite Tokyo’s efforts, the 19th round, scheduled to be held in Brunei between Aug. 22-30, will be the first round in which Japan can fully take part in as Japanese negotiators, for the most part, only received briefings from other countries in Malaysia, having missed the key working group talks on market access, which ended before Japan joined.

While time appears to be limited with the deadline just months away, Japanese officials say the country is not necessarily at a disadvantage, as the latest round revealed some countries are still divided over key issues.

“While there are some (TPP) texts that are well organized and clean, there are also many parts that are in brackets,” reflecting a number of disputes among members, said Kazuhisa Shibuya, the deputy chief domestic coordinator for the Japanese side.

TPP countries released a document stating negotiators are exploring ways to advance negotiations in the areas of intellectual property, the environment and state-owned enterprises, while agreeing on a program to accelerate talks on market access.

Japan is more likely to face problems on the domestic front, particularly regarding how to share information about the talks while being bound by the TPP’s nondisclosure contract, according to anxieties it already caused to stakeholders.

TPP rules call for strictly keeping the negotiating process and information to just a limited number of people for years and requires a new country entering the talks to sign such an agreement.

The rule has prevented the government from sharing much of the information it obtained with the stakeholders from business and farm lobbies who traveled to Malaysia in hopes of monitoring whether Japan had presented its position to protect the agriculture sector.

This lack of information fanned frustration and concerns among them about whether the negotiations are really heading in the direction they hoped for.

“As the TPP negotiation could affect Japan as a whole, we must discuss our policies” for sharing information, Tsuruoka said.