The appointment earlier this week of Shoichi Nakagawa as minister of economy, trade and industry is a mixed blessing for the nation’s trade policy.

A former agricultural minister and chairman of the Liberal Democratic Party commission on farm trade, Nakagawa, with his deep understanding of international agricultural issues, might help the nation better coordinate its trade policy.

But he might also cause turmoil within METI, which normally speaks for the nation’s industrial sectors and often finds itself at odds with the LDP.

In a recent interview, Nakagawa said the nation should remain committed to free-trade talks under the World Trade Organization while simultaneously pushing for bilateral and regional free-trade agreements.

The WTO ministerial meeting held this month in Cancun, Mexico, ended in failure, symbolizing the increasing difficulties faced by the global trade watchdog in trying to pull its member nations together.

Nakagawa acknowledged the fact Japan significantly lags behind other developed nations in FTA talks.

Japan currently has only one FTA in place, with Singapore. Of several other ongoing projects, Mexico is seen as being closest to signing Japan’s second FTA. But negotiations have not been smooth, with officials clashing over tariffs on Mexican pork, which Japan refuses to include in the agreement.

Nakagawa expressed hope that Japan could pull off an agreement in time for Mexican President Vicente Fox’s visit in mid-October.

“Although we are facing a showdown in our talks with Mexico,” he said, “we still have more time to negotiate.”

But when asked about a stalled oil exploration project in Iran’s Azadegan field, the Hokkaido native, speaking at his first news conference since assuming the ministerial post, exhibited a hint of his trademark conservatism.

After years of efforts to secure an oil route from the Iranian oil field, talks became deadlocked in July after the U.S. urged Japan to postpone the project due to Iran’s suspected development of nuclear weapons.

Unlike his predecessor, Takeo Hiranuma, who was responsible for spearheading the Azadegan project since his July 2001 meeting with Iranian President Mohammad Khatami, Nakagawa showed reservations about pursuing the Iranian oil project. The issue is too closely tied with the suspicions regarding Iran’s nuclear weapons development, he said.

“For us, Iran is on the same level as North Korea,” Nakagawa said. “We shouldn’t be lost in trying to find an oil field. . . . In light of our national interests, both issues should be weighed equally.”

Nakagawa expressed caution over Hiranuma’s proposal that Japan create a Japanese version of the U.S. trade representative’s office.

Japan does not currently have a uniform system of trade negotiations. At every trade meeting, three representatives, from the Foreign, agricultural and trade ministries, are present, often presenting different views.

“I have felt the need to set up such an organization,” Nakagawa said. “But in putting it into practice, we must also study what kind of disadvantages could arise from it.”

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