Japan fudges stance on Pacific FTA plan


Kyodo News

YOKOHAMA — With only a week left before the summit for the Asia-Pacific Economic Cooperation forum in Yokohama, Japan has shown its eagerness to test the waters of a U.S.-backed multilateral Pacific free-trade agreement.

But Tokyo has a number of hurdles to jump before it can join the negotiations for the Trans-Pacific Partnership agreement: It has to signal how committed it is to the accord and whether it is willing to drastically open its agricultural market.

Reflecting local sensitivities over the issue, especially from the farm sector, the government did not clearly state its stance in the basic FTA policy it set out Saturday, and only said that it will start approaching the countries involved in the talks.

Some experts said the policy could provide a starting point for Japan but noted that the government clearly needs to show more commitment.

Japan said in its FTA policy that “it is necessary to act through gathering further information,” and that, “while moving expeditiously to improve the domestic environment, (Japan) will commence consultations with the TPP member countries.”

Takashi Terada, a Waseda University professor working on Asian regional integration, said, “This could be a steppingstone for Prime Minister Naoto Kan (to join the negotiations).”

But he also said, “If Japan wants to be taken seriously by other countries, it has to make clear that it wants to join the negotiations. You just can’t say, ‘Give me information’ without saying whether you want to participate.”

Japan’s stance on the TPP is apparently the best the government could do right now, given that many in the ruling party are wary about the impact the pact may have on domestic farmers.

Even the ministers are divided. The government initially compiled a draft policy that said Japan would start consulting the TPP countries “with the aim of participating in negotiations,” but the phrase was eventually removed.

As seen from the month or so of political wrangling that has taken place since Kan proposed analyzing the TPP pact, it won’t be easy to coordinate views inside the country amid all the various interest groups, pundits said.

Japan has been seeking bilateral FTAs with other countries. But joining the TPP, which is being negotiated by nine countries, including the United States and Australia, is a different story because the initiative is a high-level FTA that requires members in principle to reduce all tariffs to zero.

Under a total of 11 bilateral FTA agreements that have taken effect between Japan and other economies so far, Japan has protected tariffs on about 940 items, of which 850 are agricultural or marine products, including rice, wheat and meat, government data show.

To join the TPP negotiations, the government will have to allay the concerns of the farmers, who are afraid the pact will trigger an influx of cheaper products into Japan.

“It is essential to prepare substantial safety nets on various areas, including agriculture, in opening up our country,” Kan said at a meeting of ministers involved in FTA policy.

Mitsuo Takii, a professor of J.F. Oberlin University, warned that Japan must not repeat the mistakes it made in 1993, when it struck a deal on rice imports in the Uruguay Round of trade liberalization talks under the General Agreement on Tariffs and Trade, the predecessor of the World Trade Organization.

About ¥6 trillion was spent to support the farm sector, but the deal ended up being criticized as pork barrel politics because much of the money was spent on public work projects. Some of it was even spent on building hot springs resorts.

To get approval for Tokyo to join the TPP talks, Japan may be urged to settle bilateral concerns it has with the other countries, especially the United States. Among the issues is Washington’s call to relax Japanese restrictions on U.S. beef imports.

Despite all the difficulties that lie ahead, Kan apparently had many reasons to hold back and take a positive stance on TPP.

One reason was to exercise leadership as chair of the APEC summit next weekend, where Pacific Rim leaders will outline the path toward achieving its plan to form regionwide free-trade area. The TPP is seen providing a potential core framework for the long-term goal.

The political aspect is also important, said Terada, because Tokyo is now more eager to forge closer ties with Washington amid as its territorial spats with China and Russia resurface.

“In this extremely unstable situation, Japan apparently wants to be connected with the most reliable countries in various aspects,” Terada said.

Seeking to join the TPP talks is also consistent with the demands of big business, which has been concerned that Japan is lagging behind South Korea and other rivals in the global FTA race.