Business

Japan's Lower House approves trade deal with U.S.

Kyodo

The Lower House signed off Tuesday on a trade deal with the United States that cuts tariffs on farm and industrial products, taking a step toward its entry into force next year.

The approval means the agreement, reached by Prime Minister Shinzo Abe and U.S. President Donald Trump in late September, now moves to the Upper House.

The ruling Liberal Democratic Party and coalition partner Komeito are aiming to ratify the trade deal before end of the current Diet session on Dec. 9.

That would allow them to accommodate Washington’s push for it to enter into force on Jan. 1.

Under the deal, Japan will gradually lower its 38.5 percent tariff on U.S. beef to 9 percent, and remove or reduce its tariffs on U.S. pork.

Other American products, including cheese, wine and wheat, will also gain greater access to the Japanese market.

The United States, for its part, will remove or reduce tariffs on some types of manufacturing equipment as well as for other industrial products, including parts for air conditioners and trains from Japan.

Opposition lawmakers have argued against claims by the Abe administration that this is a “win-win” arrangement.

Their main criticism is that the agreement fails to remove 2.5 percent tariffs on Japanese automobiles — something the United States had granted under the Trans-Pacific Partnership before pulling out of the 12-nation free trade agreement.

Instead, the text of the bilateral agreement says automobile tariffs are “subject to further negotiations.”

Opposition lawmakers are also taking aim at Trump’s assertion that Abe has promised that Japanese companies will purchase 2.5 million tons of leftover U.S. corn to use as animal feed.

The ruling coalition had initially hoped to pass the trade deal through the Lower House by Nov. 8, which would have secured a 30-day period until the end of the Diet session to allow it to effectively bypass the Upper House.

But deliberations were held up by the resignation of two ministers in Abe’s Cabinet amid allegations they had violated the election law.