Business / Economy

Japan won't cave in on TPP at summit, minister says

Kyodo, Reuters

A Japan-U.S. summit planned for late April should not be seen as a deadline for reaching a bilateral deal seen as vital to concluding a 12-country Pacific free trade pact, economic and fiscal policy minister Akira Amari said Tuesday.

Japan and the United States, the largest economies in the Trans-Pacific Partnership framework, will resume working-level talks on Wednesday in Tokyo. They hope to hold a ministerial meeting to advance their talks before the summit on April 28.

Speculation has emerged among trade observers that Japan and the United States may finally cut a deal when Prime Minister Shinzo Abe and President Barack Obama meet in Washington on April 28.

Amari told a news conference that the summit is “not the time limit” for reaching a bilateral deal. “If the United States is expecting Japan to give way completely before the summit, that is totally wrong.”

The 12-nation negotiations on the TPP, which would create one of the world’s largest free trade zones, have been stalled due partly to disagreements between Japan and the United States over tariffs on agricultural products and auto trade issues.

Success in the talks may depend on whether the U.S. Congress, which returns from recess this week, approves measures to ease the passage of trade deals, or trade promotion authority (TPA), Japanese officials have said.

They said U.S. Acting Deputy Trade Representative Wendy Cutler and Darci Vetter, chief agricultural negotiator at the Office the U.S. Trade Representative, will travel to Tokyo for talks with Japan’s deputy chief trade negotiator, Hiroshi Oe, and economics ambassador Takeo Mori.

Discussions are expected to tackle gaps remaining over agriculture and the auto industry.

“We think it would be good if the two leaders could announce something positive,” a Japanese government source said recently. “We are hoping that the U.S.-Japan (meeting) can send a good message.”

Japan wants to protect farm products such as rice, wheat, sugar, dairy, beef and pork, while the United States argues Japan has nontariff barriers in its auto sector.

Both allies, however, are keen for a TPP deal they see as central to the U.S. “rebalance” of its strategic focus to Asia, in response to China’s growing clout.

“I don’t know if they (Abe and Obama) will use the word ‘agreement,’ ” said another Japanese source.

“There are lots of possible expressions such as ‘good discussions’, ‘significant progress,’ ‘epoch-making progress’ or ‘steady progress.’ ”

Abe has cited agricultural reform among the key structural changes needed.

Last Thursday, Akira Banzai, head of powerful farming lobby group JA-Zenchu, said he would resign in August after the Cabinet approved a bill weakening the group’s clout and freeing up cooperatives.

That resignation could strengthen Abe’s hand in reaching a deal, some experts said.

Not all farmers oppose TPP, said Hidehiko Sogano, manager of the Bank of Japan branch in Sapporo.

“They are not unilaterally opposed, and it is certain that farmers who think it is important to use TPP and create a strong agriculture sector are increasing,” he told reporters.

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