Wal-Mart upbeat on Japan’s TPP prospects


YOKOHAMA — Japan’s stated commitment to free trade at the Asia-Pacific Economic Cooperation summit over the weekend was a positive message for global retailer Wal-Mart Stores Inc., which might be in position to sell high-quality Japanese produce overseas in the future, Wal-Mart Asia CEO Scott Price said.

Prime Minister Naoto Kan said that consultations with members of the Trans-Pacific Partnership Agreement would constitute Japan’s initial stance on joining the free-trade pact backed by the United States. But its official decision won’t be made until June due to strong opposition from farmers.

“(The) prime minister’s commitment to work on TPP is a very powerful message that he could send. I’m not sure if everyone understands how critical that first step is,” Price told The Japan Times in an interview on Saturday in Yokohama, where he was attending the APEC CEO Summit.

The 49-year-old business executive said Japan’s participation would increase business opportunities for Wal-Mart, which operates supermarkets in 15 countries.

The TPP, originally a small regional pact set up by Brunei, Chile, New Zealand and Singapore, has become a key framework for free trade in the Asia-Pacific since the U.S. stated its intention to join. Other countries, including Australia, Malaysia, Peru and Vietnam, are also negotiating memberships.

Price stressed that Japan needs to open up its market to foreign products, especially in the farm sector.

“Japan must create a more efficient and more effective agriculture industry not just for domestic purposes but for exports as well,” Price said.

Kan, afraid of being left behind the other countries in the TPP stampede, said that making the domestic farm sector internationally competitive will be a pivotal issue.

“We will quickly deal with measures to overcome the domestic environment and at the same time start consultations with nations involved,” Kan said in a speech at the CEO summit. “We will pursue free trade and agricultural reform.”

Japanese farmers are strongly opposed to the TPP because they fear that less expensive products from overseas will flood and damage the protected domestic market.

Price said Japanese agricultural products could be stronger in overseas markets if Japan joins the TPP, citing its popular Fuji apples, which he said might line up next to Washington-grown apples at Walmart stores in India, where apples aren’t grown.

Wal-Mart, which took over the Seiyu supermarket chain in 2008, has made efforts to procure its produce directly by circumventing the Japanese distribution system so it can offer lower prices. This also benefits farmers, he said.

Currently, Wal-Mart has contracts with more than 15,000 domestic farmers to buy their produce directly and plans to increase that number to more than 17,000 over the next five years.

During the panel discussion at the CEO summit, Price said Wal-Mart is committed to helping pursue a globally sustainable society by supporting such fields as education, agriculture and the environment.

Last month, Wal-Mart released its global sustainable agriculture goals.