Japan and the United States failed Wednesday to move closer over outstanding issues in their bilateral talks related to a Pacific regional trade pact, providing little hope of a breakthrough before U.S. President Barack Obama’s visit to Tokyo scheduled for only two weeks away.
U.S. Trade Representative Michael Froman, who met with his Japanese counterpart, Akira Amari, told reporters the two parties “still have gaps” over such issues as removal of Japanese tariffs on farm products and auto trade, the biggest sticking points in the Trans-Pacific Partnership free trade talks.
Amari also told reporters they “still remain apart” over the issues, adding they will resume negotiations Thursday morning to make progress toward reaching a bilateral deal, which is seen as crucial to conclude the broader 12-country TPP negotiations.
Wednesday’s talks lasted for more than 10 hours with some breaks.
The latest session of negotiations could be the last opportunity for them to advance talks ahead of a summit between Obama and Prime Minister Shinzo Abe on April 24, when both sides are hoping to reach a broad agreement on market access for agriculture and autos.
Some trade observers are expecting progress in the U.S.-led TPP talks after Tokyo and Canberra reached a broad agreement on a bilateral free trade pact that includes tariff cuts on Australian beef and Japanese automobiles.
Froman said, however, on his arrival in Japan on Tuesday that the TPP aims at a higher level of trade liberalization than the Japan-Australia deal, suggesting Washington wants Tokyo to make greater efforts to eliminate tariffs.
Japan wants to protect its tariffs on five farm product categories — rice, wheat, beef and pork, dairy products and sugar — as an exception to tariff cuts, while the United States has called on Japan to make more concessions, pushing for the basic TPP principle of eliminating all tariffs.
Japan places the TPP at the core of the country’s growth strategy to shore up the economy, while for the United States, the multilateral trade framework is part of its strategic shift toward Asia when China is increasing its presence. But the outlook for an early conclusion of the TPP is murky as the two countries keep calling for more flexibility from each other, the observers say.
The TPP countries initially aimed to conclude a deal last year.